March 11, 2009
Administration Makes First Moves on A-76 ------------------------------------------- In the Obama administration's first moves on contracting out policy under OMB Circular A-76, the IRS has canceled private collection of overdue tax debt, and a presidential memo has ordered OMB to "clarify when governmental outsourcing for services is and is not appropriate." The memo calls for a redefinition of what work is "inherently governmental" and thus off limits to contracting out, by July 1. "The line between inherently governmental activities that should not be outsourced and commercial activities that may be subject to private sector competition has been blurred and inadequately defined. As a result, contractors may be performing inherently governmental functions," it says. By making the standard tighter, the administration could effectively rope off many federal jobs from competition with the private sector. Federal employee organizations hope that the administration will severely limit the program if not repeal it entirely. However, the memo says only that agencies "must operate under clear rules prescribing when outsourcing is and is not appropriate." The IRS program had been controversial since its launch, and numerous moves had been made to end it legislatively, although none of them had succeeded against support for the program from the Bush administration and from some in Congress.