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OutsourcingACTUAL RESULTS OF CONTRACTING OUT REQUIRED BEFORE EXPANSION IS CONSIDERED Congress, Taxpayers, and Users Should Have Assessment of the Outsourcing ISSUE The FAA has recently completed the largest civilian agency Office of Management and Budget Circular A-76 competition in government through the competition and resulting contracting out of the Automated Flight Service Stations (AFSS). FAA alleges $2.2 billion in savings over ten years. This competitive outsourcing has been called one of the “largest and complex” government initiatives to date and involved the jobs of 2500 career government employees. NATCA POSITION The National Air Traffic Controllers Association believes the FAA should issue a moratorium on further A-76 competitions. Because of the enormous consequences to employees as well as the falsely optimistic cost savings, a 5-year moratorium on future A-76 competitions should be issued. This will allow the Congress, the taxpayers, the Department of Transportation Inspector General and the service users to fully and completely assess the financial success of the outsourcing as well as the loss of service ramifications. BACKGROUND On December 19, 2003 the FAA announced a public/private competition for the services provided by the 58 Automated Flight Service Stations in the continental US, Puerto Rico, and Hawaii. Alaska AFSS was excluded from the competition and will continue to be performed by FAA employees. The competition followed the guidance of OMB Circular A-76 and was administered through the FAA’s Acquisition Management System. This competition encompassed the services provided by approximately 2500 employees. On February 1, 2005 the FAA announced that Lockheed Martin was awarded the contract over four competitors that included the Most Efficient Organization (MEO), the in-house government bidder. The total estimated cost savings of the 5-year contract, with 5 additional option years, is $2.2 billion. But, this savings is not a true savings to the government or the taxpayer. Due to significant flaws in the study itself, many functions formerly performed by the AFSS FAA employees will not be performed by Lockheed Martin because they were not properly included in the bid. FAA itself has identified 13 of these functions since the bid was awarded. These functions, because they were not included in the bid package and are now being performed by existing FAA employees such as Air Traffic Controllers, NOTAM Specialists and Public Affairs specialists. Even more of the functions have been transferred to other government agencies such as NOAA and the U.S. Naval Observatory. Some other functions are being performed by Contract Weather Observers. Other information formerly provided to pilots by FAA AFSS employees will now be provided by Mexican or Canadian aviation employees. Finally, some information will only be available upon request, rather than through automatic dissemination. The loss of some of these services, as well as the transfer of others to other FAA and government employees shows that the A-76 study was neither appropriately comprehensive, nor are the cost savings alleged by FAA an accurate statement of the total cost to taxpayers. Furthermore, there are significant transition costs that were not evaluated nor included in the calculation, such as buy-outs (VSIP) and early retirement (VERA) options for existing employees. Retraining costs for AFSS employees who have transferred to other positions within FAA and retraining for existing employees who are now required to take over former AFSS functions are also not included in the cost savings. A comprehensive, longitudinal study of costs and benefits of the AFSS outsourcing must be concluded prior to the FAA engaging in another A-76 competition. Main Menu |