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Use of non-compete contracts drops

By Ed O'Keefe

By The Post's Federal Diary columnist Joe Davidson:

Not too long ago, which means through the end of the Bush administration, the rate at which Uncle Sam contracted government work out to private companies was growing by leaps and bounds. President Obama promised to stop that rapid growth and figures released Wednesday indicated he has had some success.

Office of Management and Budget Director Peter R. Orszag said contracts awarded without competition dropped 10 percent during the first half of fiscal year 2010, compared to the same period last year. Awards of contracts that generated only one bid, also dropped, but by just 2 percent.

"To put this into perspective, between FY 2000 and FY 2008, total spending on contracts awarded without competition increased significantly from $73 billion to $173 billion," he said Wednesday on his blog.

"Dollars obligated under contracts that were open to competition, but generated only one bid, also increased dramatically from $14 billion in FY 2000 to $ 67 billion in FY 2008. We not only halted this increase, but actually reduced the rate of growth in these wasteful contracts."

Contracts that pay companies on a reimbursement basis, rather than a fixed price, declined by 6 percent and those paid on the basis of time and materials/labor and hours fell by 7 percent, according to Orszag.

"Practically, these steps are saving taxpayer dollars," he said.

By Ed O'Keefe  | July 7, 2010; 11:33 AM ET
Categories:  Contracting  
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