Want to know a secret? A national security secret? Something secret about your competition? Uncle Sam may put it all on the Web.
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| Phil Bond is president and CEO of the Information Technology Association of America (ITAA). |
A new law requiring companies to disclose information about government contracts could make public sensitive information about national security and commercial subcontracts if implemented as currently proposed by the Federal Acquisition Reform Councils.
The law is the Federal Funding Accountability and Transparency Act of 2006, which requires that information be placed on a publicly accessible Web site. The idea is to give the public a way to track how taxpayer dollars are being spent. The Information Technology Association of America (ITAA) supports this law's intent. But we are concerned about the lack of some common-sense exemptions for data that should be kept secret for reasons of national security or commercial competition.
To begin with, competitors would have access to a subcontractor's pricing and have a clearer picture of where a prime contractor might need subcontractors to fill capability gaps. The result would be a chilling affect on the desire of commercial companies to bid for government contracts, driving away the very cutting-edge technologies and commercial best practices that the government needs most.
More importantly, details about national security contracts could be available to those who would do harm to government instillations or U.S. troops. Do we really want to publicize the location of the National Counterterrorism Center?
As proposed, the pilot phase of the program will require the release of information about any contract that is more than $500 million and all first-tier subcontracts more than $1 million. Importantly, the rule is expected to extend to contracts that are valued at or greater than the simplified acquisition threshold and for all subcontracts valued at $25,000 or more.
ITAA believes the rule should ensure that confidential information from contractors and subcontractors is protected at all times. Also, the FAR Councils should decide on an exemption process that would give the prime contractor or the government the chance to apply for an exemption from disclosure, including the name of the subcontractor and the location of the work to prevent a national security threat.
We have requested the proposed rule not require the public posting of subcontract data during the pilot program scheduled to get under way on July 1. The law does not require disclosing the data on a Web site until Jan. 1, 2009. The pilot should focus on collecting the data and forgo making the data public until the impact of the rule is properly studied.
Such changes would be fair, protecting the business interests of contractors and subcontractors as well as keeping national security information out of the hands of the wrong people. Transparency in contracting is important, but we should be careful not to create new vulnerabilities and raise costs for taxpayers by driving vendors and solutions providers from the public sector marketplace in the process.
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