In recent years, local defense contractors have noticed a shift in the way the government awards business: contract consolidation.
Instead of federal government agencies managing expiring, one-off contracts, they’re using multiple-award vehicles — such as the One Acquisition Solution for Integrated Services, known in the defense community as OASIS — to fulfill a host of professional services requirements.
It works like this: The government selected 129 prime contractors across the country to handle professional service contracts.
As work becomes available, those select companies bid on the jobs, and then bring on subcontractors to assist with handling the contract’s requirements.
OASIS is an effort to streamline the process for government contracting officials by consolidating multiple jobs in a single contract.
For years, the General Services Administration has been encouraging agencies to consolidate, offering them discounts in exchange for commitments to use its OASIS vehicle. The process is growing increasingly popular throughout the Department of Defense, with most services on board including the Air Force and Army. The Department of Homeland Security also uses the consolidated award process.
But what happens to the thousands of small businesses that rely on a range of smaller contracts to survive? Is the process getting too exclusive, favoring large companies and taking small business out of the competitive landscape?
Local companies in the sector weighed in on the pros and cons of the trend and how it’s affecting their business.
OASIS is a 10-year, $60 billion contract vehicle created in 2014. It selected 129 businesses nationally as prime contractors, with task orders including management consulting, logistics engineering and financial management.
It’s a GSA schedule contract so there is no continuously open application process and getting on it is a competitive process known as on-ramping. Opportunities are available once every five years.
“The OASIS contract comes up a lot for small businesses,” said Andy Merritt, chief defense industry officer for the Colorado Springs Regional Business Alliance. “The problem is, larger companies can survive because they bid on a multitude of contracts throughout the country, whereas for local small defense companies, it’s a huge challenge.”
It’s a topic Merritt and his team brought up with the Senate’s Armed Services Committee in Washington, D.C., in October, and the complaints weren’t new information to the senators, Merritt said.
“They’re hearing it from the broader community saying, ‘Hey, this is a concern,”’ he said. “The more they hear it from companies and communities, the more it helps make it a priority. We don’t want our base of small companies to erode. They bring in a lot of strengths and innovation, and that is why it’s important to us.”
Tens of thousands of small businesses do business with the federal government. Over a billion dollars has been awarded on OASIS to date, with several million dollars’ worth of work being performed in Colorado. In June, the Rocky Mountain Chapter of National Defense Industry Association reported that no work on OASIS is being performed by Colorado companies, according to defense contractor Boecore.
“Our biggest concern is how the shift to OASIS will affect the current and future defense industrial base of small businesses in our city and state,” said Kathy Boe, Boecore founder.
David Hollenbach, owner of DSoft Technologies, said he understands the government needing to consolidate some of its procedures.
But contracting officials need to understand the ramifications of OASIS.
“There needs to be a balance and better understanding of what the impact is going to be,” he said, as it’s affected his business.
DSoft has tried to pursue other avenues, but ran into similar contracting issues with Peterson Air Force Base.
“The base drives much of Colorado Springs’ economy and it does contracts like OASIS,” he said. “It’s the same issue on a small scale.”
Consolidating contracts have had a significant impact on the economy, with people losing jobs solely to make it easier for government officials, Hollenbach said.
“The government doesn’t realize what they put small businesses through when they make these type of decisions,” he said. “It’s the government’s judgment on what contract vehicle needs to be used; however, it’s important to take in the entire economic impact from this massive thing called OASIS.”
A SMART DECISION
There are only two Colorado businesses acting as prime contractors on the OASIS contract — and Delta Solutions and Strategies is one of them.
Kelly Bain founded the defense consulting firm in 2000, the only Colorado Springs company on the contract.
“I don’t think it’s a game-changer for anyone because companies get on the contract if they’re qualified,” she said.
The OASIS contract vehicle strengthens the process by vetting companies as a qualified prime through its point system, Bain said.
“The process makes sure companies are up-to-date on certifications and evaluates security controls and quality control overall,” she said. “I believe it’s beneficial to the taxpayer and streamlines the acquisition process, more so than traditional acquisitions.”
OASIS is not exclusive, Bain said, because it awards hundreds of companies. On occasion, fewer than 10 were used for some Air Force Space Command and U.S. Northern Command contracts.
“No businesses were restricted from teaming with one of the primes, which I think is an opportunity for businesses,” she said. “In the long run, I think it’s a positive for the industry.”
The OASIS process was easier than most of the contracts Delta Solutions and Strategies has pursued. The guidelines were clearly laid out on a point system based on qualifications, Bain said.
“I think it can be very beneficial to a small business that doesn’t have qualifications to be a prime, opening up opportunities to team with other businesses,” she said.
For Delta Solutions and Strategies, being a part of the contract shows the value of growing a successful business and being a prime contractor, Bain said.
But it takes continual work for companies to be successful, she said.
“As far as other businesses having an opportunity to compete for a spot, the GSA will review the contract every five years and open the spot to another business if we’re not maintaining our business and qualifications,” Bain said. “I think it’s important for businesses to not just to be doing well at one thing, but learning how to diversify and mature as a business.”
But not all companies think the contract vehicle is fair.
Summit Technical Solutions has met with the staffs of Sen. Michael Bennet, Sen. Cory Gardner and Congressman Doug Lamborn to express its concerns about OASIS, according to Jeff Benesh, space program director for the company.
“Colorado Springs enjoys a highly qualified group of small businesses that offer technical services that serve the government needs,” he said. “We want the opportunity to compete.”