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NSIAD-94-117R 1 (1994-02-18)

handle is hein.gao/gaobackmp0001 and id is 1 raw text is: ) United States GA3 General Accounting Office Washington, D.C. 20548 National Security and International Affairs Division B-252726 February 18, 1994 The Honorable John Breaux United States Senate Dear Senator Breaux: This responds to your December 7, 1993, request for data used in compiling our report Minority Contracting: DOD's Reporting Does Not Address Legislative Goals (GAO/NSIAD-93- 167, July 27, 1993). Specifically, we are providing data that supports the fact that DOD obligated a large portion of small disadvantaged business (SDB) contract dollars to a small number of companies. As discussed with your staff, we are also providing data on price premiums paid by the Defense Fuel Supply Center (DFSC) and the names of companies receiving most of those premiums. As shown in our earlier report, each year about 1 percent of the SDBs receiving DOD contracts receive about 25 percent of the funds that DOD obligates to SDBs. Enclosure I lists these SDBs for fiscal years 1990 through 1992. For each year, we identify the companies that received the most obligations, their rank (with the company receiving the most obligations ranked one), and the total obligations for the 3 years. Although 30 plus contractors are identified for each year, the enclosure identifies only 61 contractors in total because 28 appear in the listings for at least 2 fiscal years. Fifteen contractors appear in the listings for all 3 fiscal years. Price premiums are associated with contracts awarded under 10 U.S.C. 2323 preferential contracting procedures. Under DOD's implementing procedures, contracting officers, in evaluating competitively offered prices, are required to make SDBs' offers more competitive by increasing other offers by 10 percent. An SDB is awarded the contract if its price is lower than the increased offers of others. The premium is the difference between the price paid and the price that would have been paid if the low offer had GAO/NSIAD-94-117R DOD Minority Contracting

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