VA Inspector General Finds Deficiencies in T4NG Contract Administration

VA’s Office of Inspector General audited T4NG contract administration to identify weaknesses which could jeopardize federal funds and hinder mission fulfillment. The audit was aimed at determining if task orders were administered according to “federal and VA acquisition regulations, VA national policy, and local VA procedures and requirements.” The audit also sought to identify if reasonable steps were taken to ensure contractors could successfully complete contract requirements.

The VA’s Transformation Twenty-One Total Technology Next Generation (T4NG) contract vehicle was awarded to 28 contractors in 2016 to provide IT services to VA offices. This $22.3B contract provides services such as program management, planning support, systems/software engineering, and cybersecurity for a base period of five years with options for five additional years. According to VA’s Technology Acquisition Center (TAC) which administers the T4NG contracts, as of December 2018, 334 task orders had been awarded totaling approximately $9.8 billion, with an average size of $29.4 million. 

The OIG audit identified two primary weaknesses with T4NG contract administration:

1. Program Office Contracting Officers’ Representatives (CORs)Did Not Consistently Perform Task Order Administration Duties
2. TAC Contracting Officers Did Not Consistently Perform Some Task Order Award and Modification Procedures, Placing IT Contracts and Taxpayer Funds at Risk

The administration deficiencies identified related to task orders totaling nearly $82.5 million. Weaknesses were caused by staff not following procedures and lack of due diligence for task order awards.

Specifically, the audit found that “CORs did not consistently follow TAC requirements by authorizing payment for 60 of the 109 invoices reviewed without adequately documenting whether contractor deliverables were determined to be acceptable.”

As far as not consistently performing some award and modification procedures, the OIG found that staff consistently conducted market research, solicited proposals and reviewed independent government cost estimates.  However, contracting officers did not consistently review contractor past performance. Based on the OIG’s sample results, approximately 107 task orders valued at $567.2 million may have been at risk due to contractors’ unknown ability to perform specified work.  

The VA OIG made seven recommendations to rectify the deficiencies identified.  A summary of the recommendations are listed below:

• The TAC associate executive director should provide written requirements that identify the method and level of detail required for CORs to document their review of the acceptability of deliverables.
• The TAC associate executive director should develop timeliness requirements for submitting performance assessments and written procedures defining actions contracting officers should take when these requirements are not met.
• The TAC associate executive director should implement procedures to monitor contracting officer actions through compliance reviews.
• The TAC associate executive director should assess the risk related to removing the requirement to review Past Performance Information Retrieval System (PPIRS) from procedures and implement a compensating control.
• The TAC associate executive director should define higher-risk financial stability risk scores in procedures.

VA’s principal executive director of the Office of Acquisition, Logistics, and Construction agreed with the findings and recommendations. VA’s senior procurement executive plans to draft policies and/or procedures to address each recommendation by October 1, 2019.

As a result of the VA OIG’s recent audit findings, contractors may see more scrutiny of T4NG invoices and past performance records as they relate to task order awards.