Summary

In response to a congressional request, GAO reviewed the procedures that four Navy installations used to determine the number of required contract administration personnel if they contracted out their public works functions under Office of Management and Budget Circular A-76.

GAO found that: (1) the Navy projected its contract administration staffing levels on specific work-load data identified in its quality assurance plans; (2) the Office of the Chief of Naval Operations reviewed and endorsed any levels that exceeded authorized levels; (3) staffing levels that exceeded the authorized levels did not significantly affect the outcome of the Navy's A-76 studies; (4) of the 146 A-76 cost comparisons, 105 were within the authorized levels, and the Navy referred the remaining 41 to the appropriate commands for waiver requests; (5) 18 of the 41 requests were for completed A-76 studies which resulted in 6 contract awards and 12 that remained in-house; (6) the Navy believed that the authorized staffing levels were often insufficient to meet contract administration requirements for studies involving multiple or technically complex functions; and (7) although the Navy established procedures that allowed contractors to appeal cost comparisons, they could not appeal contract administration staffing levels that the Office of the Chief of Naval Operations approved.