March
14, 2003
M-03-09
MEMORANDUM
FOR HEADS OF EXECUTIVE DEPARTMENTS AND AGENCIES
| FROM: |
Angela
B. Styles
Administrator |
| SUBJECT:
|
Year
2003 Inventories of Commercial and Inherently Governmental Activities |
The Federal Activities Inventory Reform (FAIR) Act of 1998 (P.L. 105-270),
requires federal agencies to prepare and submit to the Office of Management
and Budget (OMB), by June 30 of each year, inventories of commercial activities
performed by federal employees. The purpose of this memorandum is to provide
guidance for the submission of the June 2003 FAIR Act inventories of commercial
activities and for the submission of inventories of inherently governmental
activities.
The June 2003 inventories shall be submitted in two parts: (1) the FAIR
Act inventory of commercial activities performed by civilian personnel,
and (2) the agency inventory of inherently governmental activities performed
by civilian personnel (excluding foreign nationals). The inventories should
be submitted via e-mail (hard copies and faxes are not required) to their
respective OMB Resource Management Office (RMO) and to the Office of Federal
Procurement Policy (OFPP) consistent with the guidance provided on the revised
OMB inventory website (/omb/procurement/fair-index.html)
and the instructions below.
Agencies
shall include in their submission to OMB aggregate data reflecting:
(1) the
total Full Time Equivalents (FTEs) listed as commercial,
(2) the total commercial FTEs listed as exempt from competition (Reason
Code A),
(3) the total FTEs listed as inherently governmental,
(4) the total commercial and inherently governmental activities performed
by military FTEs, and
(5) the total commercial and inherently governmental activities performed
by foreign national FTEs.
General
Instructions
1. The spreadsheet
for submission of the 2003 commercial and inherently governmental inventories
is provided on the OMB website. Other formats are incompatible with OMB's
inventory management information system and will not be accepted.
2. Each agency
should provide the name and phone number of the agency point of contact
responsible for the FAIR Act, and the website address that the agency
will use for releasing the inventories to the public. After review and
consultation, OMB will publish this information in the Federal Register
Notice of Availability.
Review
and Consultation
1. The following
agencies will be notified when OMB has completed reviewing the content
of the agency inventories:
Department
of Agriculture,
Department of Commerce,
Department of Defense,
Department of Education,
Department of Energy,
Environmental Protection Agency,
Department of Health and Human Services,
Department of Homeland Security,
Department of Housing and Urban Development,
Department of the Interior,
Department of Labor,
Department of State,
Department of Transportation,
Department of the Treasury,
Veterans Administration,
Agency for International Development,
Corps of Engineers,
General Services Administration,
National Aeronautics and Space Administration,
National Science Foundation,
Office of Personnel Management,
Small Business Administration,
Smithsonian Institution, and
Social Security Administration.
2. Agencies
not listed above may assume that OMB has completed reviewing the inventories
30 days after the electronic submission of their inventories to OMB unless
otherwise directed by OMB. Not later than 45 days after the electronic
submission of their inventories to OMB, unless otherwise directed, these
agencies should release their inventories to the Congress and the public,
and place both inventories on the agency's website.
3. The following
are the resources available on the OMB website: The 2003 Users Guide (Reason
Codes, Function Codes, DOD Function Code Definitions, Commercial and Inherently
Governmental Inventory Spreadsheet, Spreadsheet Guidance), Background
Information (OFPP Policy Letter 92-1, “Inherently Governmental Functions”
(9/23/92), and the FAIR Act Legislation (text of P.L. 105-270)).
Application
of 2003 Reason Codes
The Reason
Codes for the 2003 inventories of commercial activities have been updated
to clarify the rationale for government performance of a commercial activity.
An agency may exempt, in writing with sufficient justification, commercial
activities performed by government personnel from private sector performance
using Reason Code A. These written justifications should be available
to OMB and the public upon request.
REASON
CODES FOR
COMMERCIAL ACTIVITIES INVENTORY |
| Reason
Code |
Definiton |
| A |
The
Commercial Activity is not appropriate for private sector performance
pursuant to a written determination. |
| B |
The
Commercial Activity is suitable for a Cost Comparison or a Direct
Conversion. |
| C |
The
Commercial Activity is the subject of an in-progress Cost Comparison
or Direct Conversion. |
| D |
The
Commercial Activity is performed by a Most Efficient Organization
(MEO) resulting from a Cost Comparison decision made within the past
five years. |
| E |
The
Commercial Activity is pending an agency approved restructuring decision
(e.g., closure, realignment). |
| F |
Performance
of the commercial activity by government personnel is required due
to a statutory prohibition against private sector performance. |
Please address
any questions regarding the development of the 2003 inventories to Mr.
David Childs at (202) 395-6104.
2002
to 2003 Inventory Cross-Walk
2002
Inventory
Reason Codes |
2003
Inventory
Reason Codes |
Discussion |
| A
- “Indicates that the function is performed by Federal employees
and is specifically exempt by the agency (Agency Head) from the cost
comparison requirements of the Circular and this Supplemental Handbook.” |
A
- “The Commercial Activity is not appropriate
for private sector performance pursuant to a written determination.” |
For
2003, the Agency Head may delegate this determination. |
| B
-
“Indicates that the activity is performed by Federal employees
and is subject to the cost comparison or direct conversion requirements
of the Circular and this Supplement.” |
B
- “The Commercial Activity is suitable for a Cost Comparison
or a Direct Conversion.” |
The
2003 Code B consolidates functions that were listed in the 2002 B
and C codes. |
| C
- “Indicates that the activity is performed by Federal employees,
but it has been specifically made exempt from the provisions of the
Circular and this Supplement by Congress, Executive Order or OMB.
|
|
The
2002 Code C indicated that a function could be available for direct
conversion, but that the direct conversion is not “in-progress”
For 2003, these functions are expected to be listed in Code B. |
| D
-
“Indicates that the function is currently performed by in-house
Federal employees and is in the process of being compared or converted
directly to contract or inter-service support agreement performance.”
|
C
- “The Commercial Activity is the subject of an in-progress
Cost Comparison or Direct Conversion.” |
The
2003 Code C replaces the 2002 Code D. |
| E
-
“Indicates that the function is retained in-house as a result
of a cost comparison.” |
D
-
“The Commercial Activity is performed by a Most Efficient Organization
(MEO) resulting from a Cost Comparison decision made within the past
five years.” |
The
2003 Code D replaces the 2002 Code E. |
| F
- “Indicates the function is currently being performed by Federal
employees, but a review is pending force restructuring decisions (i.e.,
base closure, realignment, consolidation, etc.)” |
E
- “The Commercial Activity is pending an agency approved restructuring
decision (e.g., closure, realignment).” |
The
2003 Code E replaces the 2002 Code F. |
| G
- “Indicates that the function is prohibited from conversion
to contract because of legislation.” |
F
- “Performance of the commercial activity by government personnel
is required due to a statutory prohibition against private sector
performance.” |
The
2003 Code F replaces the 2002 Code G |
| H
- “Waiver Issued.” |
|
This
code is eliminated. Functions listed under the 2002 Code H are expected
to be listed under Code B in the 2003 inventory. |
| I
- “Indicates the function is being performed in-house as a result
of a cost comparison resulting from a decision to convert from contract
to in-house performance.” |
|
This
code is eliminated. Functions listed under the 2002 Code I are expected
to be listed under Code D in the 2003 inventory. |
Please address
any questions regarding the development of the 2003 inventories to Mr.
David Childs at (202) 395-6104.
|