I am referring to data.gov where allegedly the guy in charge says that the effort will collapse because of a shortfall of $25M that got cut http://www.washingtonpost.com/national/on-innovations/the-coming-death-of-open-government/2011/06/21/AGPK3afH_story.html . For one thing, I wonder what was stopping him from making do with less (hire cheaper outside contractors, recruit volunteers etc). But looking at it from another angle, suppose this $25M is absolutely crucial. So could he just start collecting donations from the general public? E.g. “to publish datasets X, Y and Z, I need to collect $20K by Sept 1; here are the likely benefits to the Republic if these get published”. Then once he completes the project, he would publish the results for all to see, thank the donors and ask for money for the next project.
Are government programs prohibited from doing things like that?
IIRC, you can’t hire “cheaper” contractors. There are specific, legal requirements to hiring contractors. And before you think the lowest bid “wins” you would be incorrect. The standard is now “best value.” These are basically safeguards to protect employment rights of workers and ensure an equitable value of the work performed. It also works to stop favoritism, nepotism, etc.
Government employees cannot solicit donations. There’s a law/regulation that prohibits such actions and federal employees may only be paid from allocated federal funds. However, some agency may collect voluntary, unsolicited donations. But again, I believe that must be statutory or regulatory authority to do so. For example, for a long time the entrance fees you paid to enter a national park, as well as the camping fees went into the general treasury funds. The Park Service basically got nothing. Now, a sizable percentage of the federal fees collected stay within the NPS and the parks where they were collected.
Soliciting donations for projects is also a no. Again, the money must come from allocated federal funds. There are some defined exceptions. Some agencies are authorized to partner with cooperating associations and profits from those cooperating associations are officially donated to the agency for specific projects where the federal funding system would be too cumbersome. Again, using the Park Service example, that book you bought from the cooperating association in XYZ National Park may help fund purchasing emergency supplies when the footbridge got washed out last week. Otherwise, that trail might have to be closed until the funding is secured to fix/replace it. That could mean two years or more before the trail would reopen. With cooperating associations funds, the bridge could be fix right away.
As for recruiting volunteers to manage a federal web site that’s a no no. Thanks to 9/11 the feds are implementing all sorts of information technology safeguards. At our agency, volunteers have no access to IT. Period. Any employee requiring access must be vetted first and complete security training.
You might think all these laws and regs contribute to red tape, bureaucratic morass and government bloat. Well, you might make a case at some level for that. But you need to balance that against the greater public good and the requirements for fairness, transparency and accountability to the American People. Mind you, federal agencies are required to be fair, transparent and accountable because Congress says so. Congress itself often does not because they tend to make rules for Executive Branch agencies, but exempt themselves from those same laws.
ok, so if a government agency cannot solicit donations, can the contractor offering to work for them solicit them instead? Let’s say a contractor plans to do the work for $2M. Agency has $1M to spend. Contractor bids $1M and collects $1M in donations via Threshold pledge system - Wikipedia . Would that violate any red tape fairness enforcing regulations?
It sounds like Duckster knows a lot more about federal regulations in general, so my input may not be 100% accurate.
However, I deal with a nonprofit organization that was established solely to support a particular city program. The nonprofit is needed for two reasons: 1) the city can’t solicit the donations directly and 2) the city’s accounting system does not have a separate fund for the particular program. (The program is a sub-unit of a bigger city department. As a result, any donations get lumped into the department’s funds, and cannot be allocated exclusively for the program itself.)
In order to form this nonprofit, we needed permission from the city. We had to set up a proper nonprofit, and include in our bylaws particular clauses about how funds would be obtained, used and distributed on dissolution.
Also, the city has a somewhat love-hate relationship with this. As much as they benefit from the nonprofit, each person we fund costs the city about $2,500 a year in administration and insurance. Technically, we can reimburse them for that, but we run into a fund-accounting issue again.
So… even when something like you’re suggesting is permitted, it’s not as simple as slapping up a web page and asking for donations. And there may still be costs to the government that can’t be fully paid by the donations.
Contracting doesn’t work that way. The feds determine they need a particular product or service performed that they themselves lack the capacity to do. So they issue a public notice, complete with particulars, of the work to be performed. The winning bidder is then paid by the feds to perform the work, subject to the conditions in the contract.
Notice the part in bold. The feds have to have the money in the first place.
The feds have lots of work to be performed all the time. However, quite a bit of the work just sits there because there is no funding to perform the work. Using my previous Park Service scenario, the NPS has billions of dollars (yes billions) in back-ordered maintenance projects all over the country. Congress just doesn’t fund them, even though the work is needed. However, when ARRA came along quite a few land management agencies took the opportunity to tackle as many back-ordered long-term maintenance project as they could. That’s why some of the debates on ARRA’s impact is misguided. It wasn’t just about jobs as it was rebuilding infrastructure and reducing that back-ordered maintenance list.
But I digress.
I worked with fed contracting officers all the time.
how do the feds know how much money they need in the first place? What if the contractor offers to do it for them for unusually low price? Do the feds actually figure out how much they will spend on a project before any contractor has bid, and so they wouldn’t solicit bids if they have less than they think is necessary?
Every major project, whether it is in the private sector, nonprofits, of the government, is a construct of months, possibly years, or preliminary work. All large governments have their own staffs of engineers who do small in-house projects, and consult on specs for larger ones. They know to within a good precision how much the project is expected to cost.
After a large project is released publicly for bid, there is always a period in which prospective bidders can ask questions and seek clarifications. This helps refine cost estimates, and may result in revised or even withdrawn and reissued specifications.
Bids are not required to go to the lowest bidder, despite that understanding. They go to the lowest **qualified and legitimate **bidder. A bidder that comes in eye-poppingly low would be subject to seventeen kinds of evaluations to ensure that fraud, unsafe work practices, low quality materials, or other dodges didn’t produce the bid. Even if government didn’t want to do this, the other bidders would immediately file suits, so the point is moot.
And part of that investigation is the financial strength of the firm. How could one firm financially absorb the loss of money involved in such a low bid? A large project would normally require a completion bond and the banks or insurance companies would do their own investigation to make sure that they didn’t have to pay out. Any scheme that seems to circumvent regulations about a firm’s background finances would never get past them in the first place.
In a good bid, there are no surprises. Surprises make everybody suspicious. Suspicions make for lawsuits. Lawsuits make for indictments. Bids are seldom about money. They are rated on multi-axis spreadsheets of qualifications. Everybody would have to buy into a new system ahead of time; you couldn’t spring it on others halfway through.
It used to be that way. The current process allows a bid to go to the bidder with the best value. That does not automatically mean the lowest qualified and legitimate bidder.
I don’t see how the issue of “qualified bidders” relates to the problem of bidding not happening at all because feds have less money than they thought necessary. Why can’t a very politically well-connected and hence “qualified” bidder offer to do the data.gov work for a lot less than the program apparently expected it would cost? Why shouldn’t they be allowed to put in such a bid and then let the paper-pushers proceed with the “best value” evaluations as usual?
Because it’s all about accountability, equity, fairness and transparency for the American People. What you propose is inherently unfair and subject to fraud.
When it comes to federal contracting, no one does anything for nothing. If they do, there’s always a payoff involved that ultimately cost the taxpayers far more.