Acquisition Reform: Section 809 Panel Suggests New Ways of Doing Business

by Darrell Hineman CPA, CFE

The Section 809 Panel’s highly anticipated Report of the Advisory Panel on Streamlining and Codifying Acquisition Regulations was released to the U.S. Congress on January 31, 2018. The Section 809 Panel is tasked with making recommendations to streamline acquisition regulations by suggesting solutions to improve the system for acquiring products and services for Government defense and security.  Its 600-page report is the first of three volumes of the final report and continues the Panel’s comprehensive examination of defense acquisition reform.

Areas of Change
The Panel summarizes five broad areas of change in the report.  Per the introduction, the report first recommends overcoming barriers to accessibility within the “dynamic marketplace” by developing a framework that affords greater variety of nontraditional contractors’ products and services through simplification of the process.  Secondly, it proposes to eliminate many provisions in hopes of creating greater flexibility and agility in selecting sources, especially for technology and commercial items.

The Panel further proposes in the report to reduce the number of approvals necessary by delegating final decisions down to “lower-level” qualified practitioners.  In this third area, the Panel specifically states that greater authority offered to junior level experienced personnel would shorten the cycle of identifying and awarding contracts to private entities. For software technology acquisitions, the Panel suggests replacing the earned value management process for the Agile method.

The fourth area focuses on the continual benefits recognized by Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) programs.  Accommodating the innovator through these proven programs would, per the Panel, offer low cost, high yield return to the taxpayer.

Finally, the fifth area of the report discusses subjects such as acquiring commercial items, reforming auditing requirements, DoD’s acquiring and funding of IT business systems, clarifying personal and non-personal services, interaction between small businesses and DoD, and other redefined intricacies of the process maze.

The Section 809 Panel Report makes several bold recommendations for change to the acquisition process but, if implemented, measuring the outcome of these recommendations will be the true test of acquisition reform. For instance, if the recommendations are instituted, we would expect to see improved delivery time, greater access to the market, and a commercial-like revolution.  Will these recommendations untangle the regulatory process to streamline DoD to the best products and services?   Another point to consider is whether future reports will reflect the perspective of non-DOD agencies. The idea of eliminating or repealing statutory requirements for DoD acquisitions sounds good if the outcome doesn’t lead to unintended litigation or abuse.

It remains to be seen what is on the horizon for acquisition reform. But if Volume 1 is any indicator, we expect there will be further reductions of regulatory and statutory requirements and a push for a more commercialized approach to dealing with the rapidly changing technology of DoD products and services.  Unfortunately, this may be difficult to achieve given the nature of the underlying regulations and statutes that were built to protect the risk adverse.

The industry will be discussing the proposed changes over the coming months. Looking ahead, it was stated in a letter accompanying the Volume 1 report that the Panel plans to present “more ambitious, bold recommendations” in the future.[1]  We look forward to more interesting recommendations from the Panel.

[1] Section 809 Panel, Report of the Advisory Panel on Streamlining and Codifying Acquisition Regulations, Volume 1, January 18
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