Cover Letter #3

These comments are submitted by Susan E. McClain, Contracting Officer, Sylvia N. Small, Contracting Officer, Michael I. Mark, Counsel and Neil J. O’Connor, Aerospace Engineer in our personal capacity and are based upon our personal experiences at NASA Langley Research Center, Hampton, Va. These comments represent our personal views and do not represent the views of NASA or NASA Langley Research Center. Like many other government agencies, NASA Langley Research Center (LaRC) relies heavily on contractors and contractor employees to fulfill its mission. Contractors at LaRC provide support in all areas – from designing the Constellation Launch Abort system, performing sophisticated tests in wind tunnels, to cutting the grass. While the federal government’s reliance on contractors has increased, the number of available contractors continues to decrease through acquisitions and mergers. Additionally, most agencies utilize broad based indefinite delivery, indefinite quantity type contracts where the work is not fully defined until the issuance of a task – making it difficult to identify potential organizational conflicts of interest at the contract level. These three events have directly resulted in a rise in organizational conflict of interests. We at LaRC have recently faced numerous and wide ranging organizational conflict of interest situations. The Technology, Engineering & Aerospace Mission Support (TEAMS) contract is the largest engineering services contract at the LaRC and second largest overall contract. TEAMS is a five year contract with a maximum value of $200 million which supports virtually all of the mission and mission support offices at LaRC, as well as the NASA Independent Program Assessment Office and the NASA Engineering and Safety Center. TEAMS contractors routinely participate in all aspects of LaRC’s research, engineering, and mission support. As such, it is one of the most important contracts at NASA LaRC. Within several months of the contract start, Alliant Techsystems, Inc. (ATK) announced its intentions to purchase the TEAMS Prime Contractor Swales, closing the deal on June 8, 2007. Since ATK was already a significant prime and sub contractor to NASA, this merger presented significant potential Organizational Conflicts of Interest (OCIs) in the performance of tasks under the TEAMS contract. Further, this purchase brought into question the contractor's ability to properly provide independent engineering services. In response, the LaRC Office of Procurement immediately convened a small tiger team to investigate the implications of this purchase. The team reviewed 97 active task orders and found that the OCIs between ATK/Swales’ interests and LaRC requirements are concentrated in specific areas based upon its efforts/position in the industry; (e.g., hypersonics, Constellation, propulsion). These intersections between ATK/Swales and LaRC cross through virtually all of LaRC’s organizations. These OCIs cover all 3 potential OCIs identified by case law: Biased Ground Rules; Unequal Access to Information and Impaired Objectivity. Many task orders presented all 3 potential OCIs. The team took immediate mitigation action on several tasks, including moving work off of the TEAMS contract. However, the OCIs on most tasks were mitigated through firewalls and limitations on access to data. Finally, the team negotiated a modification to the contract that strengthened the OCI provisions in the contract, established a formal procedure for performing an OCI review of each new task, and put in place a quarterly meeting between LaRC and Swales to review upcoming actions, current contracts and subcontracts, and current pursuits. This review gives both parties insight into planned projects and allow for mitigation of potential OCIs. We have also provided training to our Contracting Officer Technical Representatives and other technical staff on OCIs. A copy of the review process (Attachment 2), revised TEAMS OCI language (Attachment 3), and training materials (Attachment 4) are provided. NASA LaRC is in the process of competing an alternative contract vehicle to provide an OCI free source for work that presents an unacceptable risk of OCI. A stringent OCI clause has been drafted to ensure the contractor’s independence and freedom from potential OCIs. A copy of this clause is included at Attachment 5. NASA LaRC is also in the process of negotiating an agreement to support the NASA Independent Program Assessment Office in providing independent analysis and assessments of current and future NASA programs and projects. Because of the criticality of receiving true independent assessments, the agreement requires the submission of a “Certificate of Independent Assessment” for each new effort. A copy of this clause is included at Attachment 1. Based upon our experiences, we strongly believe that additional coverage on OCIs is needed in the FAR. The current guidance is extremely dated and does not reflect new case law or the new basic classifications of OCI. The examples are also dated and do not reflect current practices. The FAR currently does not contain a clause for OCIs. While a one size fits all clause may not be appropriate, a clause for use “substantially the same as” would be extremely useful. Also, the FAR does not address contract management of an OCI. As we’ve experienced, you may not be able to identify all potential OCIs even at contract placement, and the FAR does not provide any guidance on continued monitoring of, or good contract administration practices, for contracts with OCIs or potential OCIs. We believe that there should be a government wide database of OCI clauses that would be available to Contracting Officers as a source of potential language as well as a potential learning tool. Currently, there is no way of sharing OCI experiences and successful and unsuccessful mitigation strategies. We strongly believe that expanded FAR coverage on OCIs would enhance the integrity of the Government’s decision making processes. The cost of an OCI can be high as demonstrated by the NASA’s recent experience with the Mars Discovery program which resulted in a 2 year delay in the mission and substantial costs. Attachment 1 – IPAO organizational conflict of interest clause Attachment 2 – TEAMS OCI Process Review document Attachment 3 - TEAMS OCI language Attachment 4 - OCI Training Materials Attachment 5 - LASER organizational conflict of interest clause