Stimulus Implementation: The Chokepoint


President Obama signs the Stimulus Bill today.  Even though agencies have not known the details behind it, they’ve been madly scrambling for weeks to prepare for its implementation.  There are many deadlines and procedural elements that must be met.


The biggest challenge, though, may lay in the capability of government agencies to be able to actually deliver on the promises made in the bill. That capability – to make and monitor grants and contracts – has been seen as being on the verge of administrative collapse even before the Stimulus Bill.


Last year, the IBM Center co-sponsored with George Mason University a series of acquisition reform seminars with leading figures in the federal acquisition community.  They found that “the federal government spends almost half a trillion dollars a year on contracted support.  This comprises over two-fifths of all discretionary spending.”  The Stimulus Bill will nearly double that activity. 


More importantly, though, “. . . many observers feel the federal government’s contracting system is broken . . . those operating within the system see the environment as ‘toxic,’ characterized by fear and mistrust, and with oversight bodies such as agency inspectors general second-guessing their every action.”  The Stimulus Bill adds a quarter billion in spending for additional oversight by inspectors general and creates an oversight board, as well.


Max Stier, president of the Partnership for Public Service, reinforces the sense of a contracting system in trouble in a recent Washington Post editorial, noting:  the current federal contracting system is in serious disrepair, and has become a losing proposition for our government, for the American taxpayers, and even for the contractors who have to navigate through these dysfunctional waters.”  He recommends that President Obama:

  • Put someone in charge of government-wide workforce planning.
  • Make sure we don’t outsource our brains.
  • Devote adequate resources to manage contractors.
  • Look to achieve results, not make arbitrary changes.
  • Work with Congress to improve budgeting process.

But these are long-term fixes that will take years to act upon.  They don’t solve the immediate need of spending stimulus monies to get Americans back to work.


Steve Kelman, former head of procurement reform in the Clinton Administration, observes in his blog that, while Congress has set aside money for agency implementation, “. . . given the speed with which equipment is supposed to be bought, there’s not enough time to hire and train new contracting officials.”


So what can be done?  Kelman says there are two immediate actions:  First, use pre-competed contracts as much as possible, and second, use the experience of Katrina where agencies can borrow contracting talent from other agencies that are not involved in implementing the Stimulus Bill.  Being able to identify and take action on ways to streamline the contracting process will require leadership from the yet-to-be appointed head of procurement policy at the Office of Management and Budget.  Finding ways, like Kelman suggests, to streamline the contracting process will help, but will likely not be enough.


The White House issued a directive to agencies on February 9th to begin putting the workforce resources in place to implement the Stimulus Bill.  But in many cases, there are no resources to be shifted from one function to another.  The Office of Personnel Management may be the key to addressing some of these issues, for example by allowing retired contracting officers to return to work without giving up their pensions.  Here too, there is no appointed agency head yet in place.


So the implementation success of the Stimulus Bill may lay in the hands of the yet-to-be appointed officials.  And the clock on the deadlines in the Bill is  now ticking. 


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