Finding Closure

By June 17, 2015September 5th, 2018Contracting
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Rock Island contract closeout team returns more than $320 million to customers, capturing lessons learned from 13 years of contracting in Southwest Asia.

By Mr. Jake Adrian and Ms. Andrea Kalb

On a daily basis, the Reachback Contract Closeout Team is effectively closing chapter after chapter of the long story that comprises the past 13 years of war in Southwest Asia. This team, located at Army Contracting Command – Rock Island, IL (ACC-RI), a subordinate organization of U.S. Army Materiel Command’s Army Contracting Command created in 2010 to process and close out approximately 220,000 fixed-price contracts awarded in Iraq and Afghanistan, has removed more than $321 million and counting from contracts to return to customers for reuse. It is a textbook example of how the Army can clearly identify the challenges—and successes—of the past decade and apply lessons learned to future contingency contracting.

The team represents just one of many contracting missions created or brought to Rock Island in support of the wartime efforts in Southwest Asia. Since 2001, contracting at Rock Island Arsenal has grown from 222 professionals obligating $1.7 billion to a high in 2011 of 547 personnel obligating more than $14.2 billion, much of it in the contingency arena. The withdrawal from Iraq and Afghanistan has reduced total obligations and contract actions in recent years and it is now giving personnel some time to sift through and close 13 years of actions, and to leverage the past decade of work to streamline operations.

Taming a Paper Tiger

TAMING A PAPER TIGER The contract closeout warehouse at Rock Island Arsenal, IL, contains thousands of contract files that originated in Iraq and Afghanistan. ACC-RI’s Contract Closeout Branch, Reachback Division, has processed and closed approximately 220,000 fixed–price contracts and returned more than $321 million in current and expiring funds to customers for reuse. (Photo by Liz Adrian, ACC-RI)

REVERSING CONTINGENCY CONTRACTS
The Contract Closeout Branch fully recognizes that the contract files it is closing were awarded by contracting officers dealing with a variety of barriers. Working in a war zone is inherently tumultuous, and working with mainly foreign firms added to the complexity, bringing language barriers, currency conversions and various administrative misunderstandings.

The branch is now working through many of the same difficulties, which have been compounded by the passage of time. For example, personnel trying to process releases of claims, to verify there are no outstanding payments so that excess funds can be removed from the contracts, are finding no one to contact on the vendor’s end nor on the government’s behalf.

The biggest enhancement to contingency contracting now and in the future would be for contracting officers in the field to make sure they have all of the proper documentation, including memorandums for record describing the facts of the situation to justify their actions. Having a DD 250 (Defense Material Inspection and Receiving Report)—which verifies that supplies were received or services were completed—was not always possible, but there needs to be verifiable correspondence acknowledging that the government accepted a service or supply.

Paperless contract files (PCF) and the Virtual Contract Enterprise (VCE) tools are huge enhancements that will improve accountability in contingency contracting. The contract files that the ACC-RI closeout team is currently closing out are all hard copies, many of which the team randomly discovered in boxes and containers with no background information.

In 2001, the Army didn’t have VCE capability. The ­ACC-RI principal assistant for contracting required ACC-RI to use PCF for the first time in May 2009, and the U.S. Central Command’s (CENTCOM’s) Joint Theater Support Contracting Command began using it in Afghanistan in 2013. As long as personnel in theater are uploading the necessary documentation into VCE—even if it is just a data dump—it’s now there with appropriate backup. This is a critical enhancement for verification and accountability purposes.

FUTURE CONTINGENCIES
In addition to applying a contract closeout perspective to planning future contingency contracting the Global Reachback Contracting Division has already incorporated other takeaways into the contract actions it is executing.

One key lesson from the past decade of contingency contracting is that contracts should not be limited to a single country. Rather, they should be set up to allow use either theaterwide or worldwide. Several examples from ACC-RI show how expanding the use of these contracts is enhancing response time and reducing redundancy.

CLOSING A 13-YEAR CHAPTER

CLOSING A 13-YEAR CHAPTER Jake Adrian, chief of ACC-RI’s Reachback Division, and Andrea Kalb, chief of the Contract Closeout Branch, visit the contract closeout warehouse at Rock Island Arsenal. These contract files originated in Iraq and Afghanistan and were shipped to the arsenal for processing, closeout and storage. (Photo by Liz Adrian, ACC-RI)

One example is a contract first awarded in September 2013, which expanded the CENTCOM Acquisition Support Services (CASS) program for worldwide use. This program provides contracted specialists in contracting for overseas environments. Prior to expanded use, four limited CASS contracts were in singular use for Kuwait, Iraq, Afghanistan and Qatar.

Those contracts were combined into a multiple-award, indefinite-delivery, indefinite-quantity (IDIQ) contract for use CENTCOM-wide and ultimately expanded for worldwide use. If a requirement were to come out of Africa or U.S. Pacific Command, all we would have to do is compete a task order for pricing and make an award.

Another example of maximized resources was the combination of approximately 35 non-tactical vehicle leasing purchase orders for vehicles leased in Kuwait into four IDIQ contracts using multiple-award task order competitions. This replacement of purchase orders, completed in January 2008, resulted in increased competition, fewer contracts to manage and economies of scale saving $36.6 million over the five-year life of the contracts.

After receiving requirements from individual units, the Area Support Group – Kuwait combined them to give ACC-RI a total number of vehicles for contract execution. ACC-RI then competed the entire requirement and in the process negotiated quantity and volume discounts, while also locking in the vendor base. The result was a competition among just four vendors versus doing a whole new competition with different vendor bases every time we had a vehicle requirement.

CONCLUSION
The war in Southwest Asia has had a clear impact on the contracting function performed at Rock Island. In turn, ACC-RI’s support of wartime missions has made it a recognized center of acquisition excellence. The center has postured itself to readily and effectively support contingency environments as requirements arise.

The Gansler Commission report and the Commission on Wartime Contracting both highlighted the fraud, waste and abuse that can occur during contingency contracting. ACC-RI has demonstrated that it can perform contingency contracting from a U.S. location. The support of robust pricing and policy divisions along with Army Materiel Command – Rock Island Office of Counsel greatly reduces fraud, waste and abuse.

ACC-RI recommends that DOD or DA establish a program manager (PM) contingency (PM C) to work in concert with the PM for the Logistics Civil Augmentation Program (LOGCAP). To work effectively, PM C would be charged with having 100 percent visibility into all DOD agencies executing contracts in the area of responsibility, and be the overall requiring activity.

CLOSING DOWN, MOVING OUT

CLOSING DOWN, MOVING OUT The 1742nd Transportation Company, South Dakota National Guard, escorts a convoy through Qalat, Afghanistan, July 23, 2014, on the way to Kandahar Airfield as part of the Regional Command – South effort to close outlying bases and draw down forces. Closing out contracts related to operations in Afghanistan and Iraq has been both challenging and rewarding for the ACC-RI team. In the future, it could be simplified through the use of paperless contract files and VCE tools. (U.S. Army photo by SSG John Etheridge)

The PM would be responsible for an integrated acquisition strategy that would be responsive to Soldiers’ needs and not re-create the process. It would decide—along with the LOGCAP PM—whether the effort should be placed under ­LOGCAP, use other existing contracts or be a new effort. This would greatly reduce redundancies in contracting efforts, decrease overlap of the same services at the same location and enhance responsiveness. Ideally, it would operate very much like the various PMs the Army has in the States, but would be the single portfolio manager for all services in theater.

Finally, the Army needs to maintain a reachback capability. The primary reason that the closeout mission has recaptured so much money is the constant turnover of deployed contingency contracting officers. Those who worked tirelessly in theater undoubtedly did the best they could, but when personnel rotate in and out in as few as four months with little to no overlap, knowledge, history and even basic personal connections are easily lost. This risk is greatly reduced by having a stable, enduring workforce that has experience with these types of contracts.

SORTING THROUGH WHAT’S LEFT

SORTING THROUGH WHAT’S LEFT At the Forward Issue Turn-In Point at Kandahar Airfield, contractors load containers for shipment to Bagram Airfield. Retrograding equipment back into the Army’s supply inventory saves taxpayer dollars and allows supplies to be moved out of Afghanistan. But closing out the related contracts can often be complicated by language barriers, currency conversion questions and lack of proper documentation. (Photo by SGT Adam Erlewein, 4th Sustainment Brigade)

For more information, contact the ACC-RI at usarmy.ria.acc.mbx.acc-ri-pao@mail.mil.

MR. JAKE ADRIAN is chief of the Global Reachback Contracting Division at ACC-RI. He holds an MBA from St. Ambrose University and a B.A. in liberal studies with an emphasis in economics, math and aerospace engineering from Iowa State University. He is Level III certified in contracting and Level I certified in program management, and is a member of the Army Acquisition Corps (AAC).

MS. ANDREA KALB is chief of the Contract Closeout Branch, Reachback Division, at ACC-RI. She holds an MBA from Northern Illinois University and a B.A. in international business from Bradley University. Kalb is Level III certified in contracting and is a member of the AAC.


This article was originally published in the April – June 2015 issue of Army AL&T magazine.