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SAVANNAH, GEORGIA

THE ARMY CORPS OF ENGINEERS' STOCKROOM IN DOWNTOWN SAVANNAH, GEORGIA.

52

Thank you for your letter of June 12, 1980, transmitting copies of
your draft report to the Congress entitled, "GSA's Self-Service Store
Program Fails to Implement the Federal Property Act."

We appreciate the opportunity to comment on this comprehensive report.
It contains extensive material which requires Central Office and regional
review in order to present an accurate and complete response with definite
plans for corrective actions. At this time we feel it would be beneficial
to withhold specific comments and plans until this review and the following
studies are accomplished.

We have had a consultant with us since June 2, 1980, who is conducting
an in-depth review of the policies governing the operations of self-service
stores. This review includes, but is not limited to, an appraisal of the
line items carried, operating procedures, accounting, inventory management.
program concepts, and general management controls. A report of these
findings should be completed by mid-September which will be invaluable
to an accurate, detailed response and for planning courses of corrective
action.

We also plan to canvass Federal activities for their views regarding the
consolidation of duplicative stores and stockrooms before we proceed with
any plans in that direction.

While awaiting publication of the final report, we will aggressively
continue instituting corrective procedures as necessary to implement
the report recommendations and improve the operations of our self-
service stores.

APR 19 1979

Assistant Administrator for Acquisition Policy (AP)

Multiple Award Schedule Program

Commissioner, 135 (7)

Recent events have made it desirable to re-examine the policies applicable to the Federal Supply Service (FSS) multiple award schedule contracts and to make some changes. These include recent congressional hearings, investigations by the General Accounting Office (GAO), Agency statements regarding the availability of items at prices that are lower than provided by schedule contracts and other matters.

In the interest of coming to grips with the problems involved, we have prepared a policy document (copy enclosed) which addresses the following:

A.

General Management Policies on Multiple Award Schedules.

B. Specific Policies Requiring. FSS implementation.

· Part A sets forth a general statement of policy and those significant general management policies now covered in outstanding GSA regulations. Those management policies which appear to us to require special attention are discussed in Part B.

All of the policy matters covered by the document are accompanied by proposed implementation plans. The policies and related plans, as finally accepted by FSS and AP, constitute the basis on which FSS is to award and administer multiple award schedula contracts.

We are anxious for the Federal Supply Service, the Office of Acquisition Policy, and GSA generally to achieve the best possible position regarding all matters relating to multiple award schedule contracts. Unquestionably, all of us are desirous of ending the criticism which has been leveled at the Federal Supply Services' use of this method of supply.

After you review the document, we would like to sit down with you, preferably within the next two weeks, and make any changes which are desirable and mutually acceptable. Thereafter, it is expected that FSS will act promptly to carry out the plans and policies.

With your cooperation and assistance, I am sure we can achieve the results desired regarding the use of multiple award schedule contracts.

(SIGNED) DALE R. BABIQNE

DALE R. BABIONE Assistant Administrator for Acquisition Policy

Enclosure

(See next page for distribution and concurrences)