Alissa Tabirian
NS&D Monitor
7/17/2015
The National Nuclear Security Administration (NNSA) must pay closer attention to its management of Support Service Contracts (SSC) to avoid violating federal regulations that govern personal services contracts and inherently governmental functions, according to a special review released this week by the Department of Energy (DOE) Office of Inspector General (IG).
The IG report, which follows a 2013 self-assessment conducted by the NNSA’s Office of Defense Programs, found that a significant portion of the SSCs reviewed "exhibited one or more of the characteristics of a personal services contract," according to the audit. These contracts involved “relatively continuous supervision” of contractor personnel by a federal employee, which is not permitted under the Federal Acquisition Regulation (FAR). In one instance, “the statement of work for one contract included qualifications for a senior project manager that appeared to be written for a specific individual,” which would indicate a “prohibited personal services relationship,” the report says. The Defense Programs self-assessment also discovered that “many contractor employees . . . were used interchangeably, or in lieu of, Federal employees,” prompting the NNSA to train its personnel “on the appropriate administration of SSCs,” according to the IG report.
The audit also found that some contracted services "approached being inherently governmental functions," including "the determination of agency policy and program priorities, and the direction of Federal employees." According to the report, in some instances “contractors could reasonably appear to have been the driving force behind policy creations, determinations, and performance measures,” which risks being categorized as a FAR violation. The report notes that "NNSA’s use of program funds for some SSCs was questionable" due to discrepancies between “program” and “program direction” funding sources, but that overall, those funds “were properly allocated.” In response to the issue, NNSA released guidance on funding policies last year.
DOE "found no clear violations of the FAR or [DOE] and NNSA guidance," the report says. Instead, it says the issues of concern "often hinge upon subtlety, nuance, and professional judgment." The report notes that NNSA has taken various corrective actions, including personnel training and ongoing reviews. NNSA spokeswoman Shelley Laver said in a statement that the agency continues "to track our existing action plan to completion, and we report our progress through the quarterly updates in the Departmental Audit Report Tracking System as indicated in the management response to the report.”
