The Business of Business is Government

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Muckraked! (second item) notes a Government Executive report that tells us that auditors are going to look into the FAA’s outsourcing of operations at 58 FAA flight centers around the country to Lockheed Martin. Already, the Transportation Department has realized that $500 million of the supposed $2.2 billion in savings will, well, not be realized.

Among other issues, the IG office plans to look into changes in projections for how much the agency expects to save. When the contract was awarded, FAA announced that private sector performance would save the government $2.2 billion over the life of the contract, based on a 10-year estimate for the 5-year base period with up to five extension years. In its announcement of the audit this week, the inspector general’s office quoted an anticipated savings of $1.7 billion.

“We are aware of the difference and will be looking into this as part of our review,” Barnes told Government Executive.

“If this is an honest-to-goodness audit, then I’m thrilled,” said Kate Breen, president of the National Association of Air Traffic Specialists, which represented the federal employees at the centers. She said the competition for the work, which was run under the Office of Management and Budget’s Circular A-76 rules, and the appeals process at the time, seemed slanted in favor of the contractor.

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