Testimony of James D. Staton, Jr.
Chief Procurement Officer
Committee on Government Operations
Muriel Bowser, Chair
Council of the District of Columbia
Tuesday, February 28, 2012
John A. Wilson Building
1350 Pennsylvania Avenue, NW
Washington, DC 20004
Good Morning Madam Chair and members of the Committee on Government Operations. I am James D. Staton, Jr., the Chief Procurement Officer for the District of Columbia and Director of the Office of Contracting and Procurement. I appreciate this opportunity to share with you the status of OCP’s fiscal year 11 performance and our current progress in fiscal year 12. OCP is working diligently to transform and improve the contracting and procurement process in the District of Columbia. Today, I will present a summary of OCP’s major accomplishments in fiscal year 2011 and the goals OCP is working aggressively to achieve for fiscal year 2012.
Madam Chair, when we met last month during our roundtable discussion, I shared with you some of the great work that the central procurement staff is doing, and today I would like to give you some context for these achievements.
When I arrived at OCP in March 2011, it was a very different place than it is today. OCP’s reputation among agencies and the vendor community was that we lacked a sense of commitment, urgency, and accountability for moving procurements and contracts. Additionally, I observed a lack of effective communication and collaboration between the agencies and the central procurement office. Based on audit findings, there was minimal control around contract documents and the automated procurement tool, PASS, was not optimally utilized by the procurement organization. This was evidenced by backlogged requisitions and contracts expiring without proper plans in place for continuing services. Moreover, the central procurement staff was suffering through serious issues that made it difficult to work efficiently: high staff turnover; timing in filling critical vacant positions; and a high volume of customer service related complaints. Additionally, OCP was affected by fiscal year 2012 budget reductions that included a reduction-in-force. While these adjustments were challenging, we used them as an opportunity to assess the organization.
By the end of that process, we met our budget obligations, completed a reduction-in-force, managed a total realignment of the agency, and began a shift in culture and attitude toward procurement in the District. Over the last year, with an approved staff of 84 FTEs and budget of $8.6 million for fiscal year 2012, my team and I have already reached several key milestones:
Surplus Property Division
The Surplus Property Division has more than doubled revenue from fiscal year 2010 to fiscal year 2011 totaling over one million dollars. Surplus Property is on track to surpass the million dollar mark by the end of this fiscal year.
The surplus property team is building a partnership with MPD, OSSE, and DPW that will allow for centralized online auction services managed by OCP. These collaborations allow the District to dispose of MPD fleet, District fleet, abandoned vehicles, police evidence and seized equipment using a global Internet auction platform.
The Surplus Property Division continues to manage and direct the state surplus property program that grants District agencies and certified non-profits much needed access to federal surplus property resources. The Surplus Property Division is also providing data destruction services to District agencies. OCP's Surplus Property Division strives to be a model for revenue generation, cost-savings, reutilization and over-all business agility as it pushes to bring maximum resource recovery to the District.
We have made significant enhancements to technology at OCP. Prior to the realignment, OCP had no senior level technology manager to interface with, our service provider, OCTO. As the business owners of PASS, we now have a manager and team experienced in both technology and procurement practices. This has yielded very positive results for our organization. Over the last six months, our IT team has linked existing modules, so that they communicate seamlessly with one another. The team also created new tools that will help manage and respond to issues in the procurement process. One tool is our project initiation form, oPIF. Another is our acquisition planning tool which allows agencies to plan their procurements according to budget. Finally, the Ariba Category Management tool allows for milestone tracking and bottleneck identification in the procurement process.
Audit and Compliance
In our ongoing assessment of contracting and procurement practices in the District, we identified opportunities for improvement in our audit and compliance efforts. OCP’s Office of Procurement Integrity and Compliance, known as OPIC, has expanded its audit program to include procurements in excess of $100,000. In the past, our audit program focused almost exclusively on procurements in the small competitive threshold. However, based on OPIC’s assessment, almost 80 percent of the District’s expenditures are in the large competitive threshold. We have realized that it only makes sense for us to focus our oversight and compliance efforts on this class of procurements, since they represent the greatest risk exposure to the District. Our goal is to create a sustainable contract administration process focused on proper execution of contracts, vendor performance, and timely payment for receipt of goods and services.
OCP’s revamped contract administration and compliance program is based on frequent interaction with Contracting Officers and Contract Administrators, surprise audits, and ongoing reviews of contract monitoring responsibilities. We have notified agency directors and procurement staff of the changes to the audit program through memos and training courses. In November 2011, OPIC launched a District-wide refresher course on contract administration accessible by all employees both online and in person. Compliance audits are now underway and results will be communicated to agency directors and the City Administrator.
Customer Service Center
Upon evaluation of the workload of our contracting staff, we realized the difficulty in balancing procurement work and responding to calls and inquiries from agencies, potential bidders, and existing contractors. Our solution was to create a Customer Service Center to serve as a single point of contact for agency customers and vendors. This shift allows procurement staff to focus solely on completing procurements in a timely and efficient manner.
The Customer Service Center is fully staffed and has begun to handle service calls from agencies and vendors, conduct bi-weekly training sessions for vendors on how to do business with the District, and register vendors in PASS.
Training and Education
In fiscal year 2011, OCP delivered 19 procurement and PASS related courses to OCP central staff, Agency Contracting Officers and other procurement staff in agencies. Those courses were completed by 760 employees over the course of the year. OCP has trained 484 employees in fiscal year 2012.
The first phase of the OCP procurement training institute was rolled out February 6, 2012. The institute will deliver a comprehensive set of courses that prepare the procurement staff to execute DC Government procurements according to DC law, requirements, and regulations. Ultimately, all staff under OCP’s authority will be required to successfully complete the curriculum and become certified by OCP.
As Director, I am committed to providing the support, resources, and training necessary for developing the District’s procurement staff. Our goal is to create a culture of accountability, collaboration, and efficiency, or ACE, in the District’s procurement process.
Each of these milestones has helped us build the foundation we need to transform the District’s procurement process. This is an ongoing effort, but I am proud to say that we have made significant progress in the right direction. We are not the same OCP that we were a year ago. We have shrunk in size, but have not lost our commitment to fulfilling our mission to provide quality goods and services to the District of Columbia.
Moving forward, OCP will continue to address our most critical issues: reducing procurement cycle times, analyzing the procurement process and skill sets at OCP and those agencies with delegated and independent contracting authority; expanding outreach to the DC vendor community; evaluating and enforcing contract administration; and continuing to enhance our use of technology.
Madam Chair and members of the committee, I thank you for your support and I thank my colleagues and employees of OCP for their dedication and hard work to transform procurement in the District. This concludes my testimony and I am happy to answer any questions you may have.