December 1, 2003


By Tom Shoop

The Bush administration took a tough-guy stance last week to protect its efforts to subject federal employees' jobs to competition from the private sector. But the White House may end up paying a high price for a relatively insignificant victory.

The story starts on the night of Nov. 12, when members of a House-Senate conference committee on the fiscal 2004 Transportation-Treasury appropriations bill approved provisions regarding public-private job competitions that they doubtless thought--if they thought at all about them--were relatively innocuous.

The provisions gave federal employees the right to form "most efficient organizations" and participate in any competition where more than 10 jobs are at stake. In such competitions, a contractor would have to bid either 10 percent or $10 million less than the in-house team to take over the work. Finally, if the in-house team members lost, they--or their representatives--could appeal to the General Accounting Office.

At the time, the White House didn't raise a peep of objection to the language. But the provisions--especially the one on appeal rights--infuriated contractors, who quickly swung into action through their representatives in Washington.

Stan Soloway, president of the Professional Services Council, told Government Executive's Amelia Gruber on Nov. 13 that the language represented the "death knell for competitive sourcing." OMB was still on the sidelines of the debate, but Soloway suggested that maybe it wasn't too late: Since the conference report had not been officially filed yet, the White House could still try some last-second arm-twisting.

At that point, White House officials finally began voicing their opposition to the competitive sourcing language and other provisions in the agreement. Suddenly the Transportation-Treasury conference report was in limbo. As the days dragged on, the bill was folded into the omnibus spending measure cobbled together on the Hill. On Nov. 24, the administration finally secured an arrangement to undo the job competition provisions.

The deal eliminated the appeal rights language entirely and left a messy situation with the other provisions in which they applied--sort of--to some agencies, but not others. (Click here for the gory details.)

So in the end, the hardball tactics worked. But they infuriated Democrats and annoyed even some of the administration's GOP supporters. Sen. Patty Murray, D-Wash., who doesn't ordinarily get exercised about competitive sourcing issues, took to the Senate floor to denounce the administration's tactics as an "attack on federal workers, on fairness and on taxpayers."

House Government Reform Committee Chairman Tom Davis, R-Va., told The Washington Post that the revised revisions represented the "worst of all worlds" in the competitive sourcing universe. This was after Davis had actually objected himself to the initial conference committee action, saying that only employees, not their union representatives, should be allowed to appeal job competition decisions.

Davis wasn't the only lawmaker perplexed by the White House's actions. Other House and Senate appropriators repeatedly said they didn't understand the administration's objections to the competitive sourcing provisions, or why they hadn't been expressed earlier. They are not likely to forget such tactics when other elements of the president's management agenda are debated on the Hill.

The hardball approach may have been worthwhile if the administration was fighting to maintain its original objective of subjecting hundreds of thousands of federal jobs to competition. But OMB officials gave up on that goal a long time ago, when, under pressure from Congress, they dropped their across-the-board targets and agreed to negotiate individually with agencies on exactly how many - or how few - jobs would be subject to competitions.

That means that whether or not employees get to appeal, or are allowed to form most efficient organizations, or get a cost advantage over contractors, there simply are not going to be huge numbers of job competitions in agencies. All of which makes the costly victory the White House won last week seem a bit hollow.