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Groups seek limit on payments to contractors

By Joe Davidson,October 19, 2012

Federal employee and public interest groups are asking key members of Congress to significantly lower the limit on payments to Defense Department contract workers.

During a time when basic pay rates for federal employees have been frozen for nearly two years, the government can pay individual contractors up to $763,029. That amount should be substantially reduced because of “fiscal responsibility and fairness,” said the letter from 10 organizations.

The message to the top Democrats and Republicans on the House and Senate Armed Services Committees said that “with budget cuts and sequestration looming, it is fiscally irresponsible to allow private contractors to charge escalating and exorbitant rates to the government.”

J. David Cox Sr., president of the American Federation of Government Employees (AFGE), said his union is the “driving force” behind the letter. It calls on Congress to limit contractor compensation to $230,700, as proposed in the National Defense Authorization Act of 2013.

“This is important because of the taxpayers,” Cox said in a telephone interview. “Nobody in the federal government makes that kind of money, so why should we pay contractors that? . . . If you want to find savings for taxpayers, this is a good place to find it.”

The Professional Services Council (PSC), which represents contractors, said the proposal “fails to recognize that federal contractors have to compete for top talent with companies that operate exclusively in the commercial sector. PSC has long opposed this and other proposals that would drive critical skills away from the federal marketplace. PSC is no more supportive of caps on federal employee compensation than we are of this misguided proposal.”

Under the legislation, contracting companies would be allowed to pay their employees more than $230,700, just not with taxpayer money. The current limit was set through a formula determined by law. President Obama has proposed replacing that formula with one that would link contractor pay to that of Cabinet officials, which is $199,700.

Under the formula, “over the past dozen years, the increase in allowable government compensation to contractors has outpaced inflation by 53 percent,” according to the letter. “The increase authorized by the Office of Federal Procurement Policy in April 2012 alone represented a 10 percent increase in allowable compensation for contractors while military personnel — the brave men and women risking their lives in defense of the nation — saw an increase of less than 2 percent and the pay of other federal employees was frozen.”

Colleen M. Kelley, president of the National Treasury Employees Union (NTEU), said, “It is unconscionable that taxpayers may pay more than $700,000 to some contract employees. It is time to rein these costs in, and this legislation does just that. I hope that Congress will adopt this measure and bring some fiscal sanity to the contracting process.”

Limiting the compensation to $200,000 would save at least $5 billion annually, the letter said. In addition to AFGE and NTEU, it was signed by leaders of the AFL-CIO; the American Federation of State, County and Municipal Employees; the Economic Policy Institute; In the Public Interest; the International Federation of Professional and Technical Engineers; the National Employment Law Project ; OMB Watch; and the Project on Government Oversight.

Challenging suspensions

The National Association of Assistant United States Attorneys wants the Merit Systems Protection Board to overturn the suspensions of two federal prosecutors for misconduct that led to the dismissal of former senator Ted Stevens’s conviction on corruption charges.

Joseph W. Bottini was suspended for 40 days and James A. Goeke for 15. Both were part of the Stevens prosecution team and based in Alaska. The association acknowledges problems with the 2008 prosecution of Stevens, who died in 2010. The organization, however, said the Justice Department “failed to appropriately acknowledge the collective responsibility of the entire trial team and the exceptional circumstances that led to the prosecution’s discovery-related errors.”

The Justice Department had no reaction on Thursday to the organization’s comment. At a Senate hearing in June, Sen. Charles E. Grassley (R-Iowa) asked Deputy Attorney General James Cole about “evidence of a double standard of discipline for managers and line employees.”

Cole said there was “misconduct by the line prosecutors by not fulfilling their discovery obligations, and I think we had poor supervision and mismanagement by the supervisors in not making sure that the trial attorneys were in fact paying attention to those rules.”

Although the supervisors were guilty of “micromanaging the trial teams, as opposed to letting them do their jobs,” Cole said, the supervisors’ conduct was dealt with as “a management issue.”

Twitter: @JoeDavidsonWP

Previous columns by Joe Davidson are available at wapo.st/JoeDavidson.