FAA’s Information Technology and Telecommunications Contracting Practices Limit Best Value Outcomes

What We Looked At    Each year, the Federal Aviation Administration (FAA) procures billions of dollars in information technologies (IT) and telecommunications (telecom) products and services in support of its mission to provide the safest and most efficient aerospace system in the world. For fiscal year 2024, the Agency requested approximately $3.9 billion for its IT and telecom needs. Our prior audit of the Department of Transportation’s (DOT) IT shared services contract vehicles identified issues with DOT’s award and modification practices. Given our previous findings, and the high dollar amounts FAA expends for IT and telecom services, we initiated this audit. Our objective was to evaluate FAA’s practices for awarding and modifying its IT and telecom contracts. We focused our review on the award and modification practices associated with (1) determining sound pricing and (2) promoting competition. What We FoundFAA’s noncompliant IT and telecom contracting practices inhibit establishment of sound pricing. Per the Agency’s Acquisition Management System (AMS), procurement teams are required to conduct price and, at times, cost analyses, and program offices must develop sound independent Government cost estimates (IGCEs) prior to contract awards. However, FAA officials could not provide the required price and cost analyses for 3 of 26 sample contracts or the required IGCE for 1 of these 3 contracts. Additionally, FAA developed inadequate IGCEs for 16 sample contracts. Without adequate IGCEs, FAA lacks a critical pricing tool to help conduct price analysis, detect unreasonable offerors, and establish sound pricing. FAA’s IT and telecom contract award and modification actions also restrict competition. Specifically, FAA extended contracts noncompetitively, expanded the scope of a contract noncompetitively, and made questionable noncompetitive award decisions. These actions were largely due to the Agency’s lack of sufficient procurement planning and unclear guidance in AMS. As a result, FAA denies other firms the opportunity to deliver IT and telecom products and services. Our RecommendationsWe made seven recommendations to strengthen FAA’s IT and telecom contract award and modification practices. FAA concurred with all seven recommendations. We consider all recommendations resolved but open pending completion of planned actions.