IG: GSA’s Schedules Program Pricing Issues Cost Taxpayers

A General Services Administration Inspector General audit released this week suggests outdated or inaccurate pricing information provided by contractors regarding products and services on the GSA Schedules Program may cost taxpayers as much as $405 million per year.

The audit is the fourth in a series of IG reports highlighting issues in GSA’s Schedules Program, under which the Federal Acquisition Service has established numerous governmentwide contracting vehicles for commercial goods and services.

Agencies use the Schedules Program to purchase everything from pens and paper to complex cybersecurity services at a clip of about $32 billion in sales in fiscal 2014.

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After auditing 42 contracts worth an estimated $6.5 billion in sales, the IG concluded 33 had contractor-supplied disclosures “that were not current, accurate and/or complete.” Information in those disclosures is vital to contracting officers charged with determining whether commercial schedule prices are “fair and reasonable and in line with the contractor’s commercial sales practices.”

“Without current, accurate, and complete commercial-supplied disclosures, the contracting officer’s ability to provide customer agencies with market-based pricing, the foundation of the Schedules Program, is significantly impaired,” the audit states. “If the contractors had provided all of the required information, contracting officers could have used that information to obtain potential cost savings of over $405 million.”

In addition, the audit found instances where the Schedules Program is not providing the lowest overall cost alternative to government customers, which flies in the face of what the program’s intent to leverage the government's buying power to the utmost degree. Also in part because of these issues, the IG said contracting officers at GSA were able to negotiate less than half of $221 million in savings previously identified by the IG.

The FAS has been working to improve the Schedules Program over the year, hosting events and garnering public feedback. A FAS spokesperson emailed a statement to Nextgov stating that FAS will review the IG’s latest audit and use it to improve Multiple Award Schedule contracts.

“FAS recently received the GSA Office of Inspector General's annual report summarizing their findings for 42 Multiple Award Schedule contracts they reviewed in FY14. We look forward to reviewing the findings,” the FAS statement said. “FAS values the OIG's support and will continue to work closely with them to improve and enhance the MAS program.”