Watchdog dings GSA’s transactional data reporting pilot

After almost seven years, the General Services Administration’s Transactional Data Reporting pilot program is still “flawed” because of inaccurate, unreliable and unusable data, which could cause government agencies to pay more for goods and services, according to the agency’s Inspector General. 

Monday’s document is the latest OIG report to detail issues with the TDR pilot program. Established in 2016, the TDR pilot requires Multiple Award Schedule contractors to report transactional data, such as prices paid by government customers for products and services under a contract. In return, contractors do not have to disclose commercial pricing or comply with price reduction requirements. 

The report found that the program is full of inaccurate, unreliable and unusable data. Moreover, OIG asserted that GSA’s fiscal year 2020 evaluation of the program is problematic because it portrayed TDR as a success, but GSA “has never used TDR pilot data in contract price negotiations.” Furthermore, GSA could only find a single instance where it allegedly used this data in price negotiations, but the negotiating GSA contracting officer and vendor agreed the data was inaccurate and unusable, OIG noted. 

Additionally, the watchdog stated that GSA’s evaluation was misleading in supporting the agency’s claims that TDR met its performance objectives and was successful. However, OIG asserted that GSA used flawed methodologies and inaccurate and unsupported information to perform its evaluation. Therefore, the evaluation metrics to determine whether the program was used for negotiations and lower industry burden was deficient.

According to OIG, the transactional data reported for 87% of the FY 2022 TDR program sales cannot be used for a meaningful price analysis. 

“We have deep concerns about GSA’s Transactional Data Reporting pilot,” GSA Inspector General Carol Fortine Ochoa told Nextgov in an emailed statement. “Our most recent report found that GSA’s assessment of the program, which recommended expanding the TDR pilot, provided a misleading portrayal of the pilot as successful. In fact, the data GSA has collected from vendors in the TDR pilot program is almost entirely inaccurate, unreliable and unusable. Under these circumstances we believe it would be irresponsible to expand TDR across GSA’s Multiple Award Schedules Program, which last year had more than $40 billion in annual sales. We strongly urge GSA either to terminate the pilot or fix the pervasive problems with the data and credibly demonstrate its consistent and successful use in price negotiations on behalf of the American taxpayer before taking any action to further expand the pilot.”

The Inspector General made three recommendations:

• Stop expanding TDR until the problems are fixed or the program is terminated.
• Address the aforementioned issues with data and usage as detailed in the report within one year.
• If GSA cannot successfully complete the corrections within one year or decides not to perform these actions, the agency should use the TDR pilot’s exit strategy and transition participating contractors out of the program.

GSA partially agreed with the recommendations. Specifically, the agency stated that for the first recommendation it will “consider the continuing maturity of TDR as part of any expansion decision.” 

For the second recommendation, the agency “agrees with the need to address data completeness, quality and usage, but the technical approach and contractor engagement strategies necessary to meet these needs will be pursued on a timeline that aligns with TDR maturation.” 

Lastly, for the third recommendation, GSA stated that it “launched the TDR pilot to ensure a measured and manageable transition to the use of transactional data. Part of the pilot framework is the cancellation policy, which still exists and will be executed if TDR does not provide value to the taxpayer. However, GSA anticipates that work to improve the TDR pilot program will continue for more than a year from report issuance.”

Moreover, GSA noted that because it “believed there were benefits to TDR, potential further benefits of the data were emerging and there was a commitment to address acknowledged issues, GSA concluded the pilot met its objectives and that expansion with further improvements was the best course of action for GSA’s customer agencies and taxpayers.” 

In a press release, the OIG emphasized that GSA’s response did not address or rebut the watchdog’s findings and instead “repeats its FY 2020 TDR pilot evaluation results and makes numerous assertions of the ‘potential further benefits’ and ‘anticipated’ uses of the TDR data. The agency does not commit to curing the deficiencies our audit exposed before expanding the pilot further, but merely states it will ‘consider the continuing maturity of TDR as part of any expansion decision.’”

OIG reiterated that the agency’s “vague response fails to acknowledge the fundamental fact that GSA has not used TDR data for price negotiations.” The watchdog added, “after nearly 7 years of running the pilot, GSA’s ability to use the data to negotiate fair and reasonable pricing on behalf of the American taxpayer remains an untested theory. Accordingly, we reaffirm our findings, conclusions and recommendations. Our unrebutted findings clearly demonstrate severe deficiencies in the TDR pilot that must be corrected before its expansion across the MAS program’s annual sales of more than $40 billion.”

“GSA’s inexplicable refusal to commit to fixing those problems before further expansion, or alternatively to terminate the pilot, is a disservice to taxpayers,” OIG said in the press release.

When reached for additional comment, GSA pointed to its statement in the report.

The OIG has released several reports about issues with the TDR program in the past few years. For example, a 2022 report found the pricing methods GSA contracting personnel used for MAS contracts in the pilot were deficient and the personnel were unable to access TDR data to use for pricing decisions on pilot contracts.

Moreover, a 2022 memo noted that plans to expand the pilot could cause the government to overpay for products and services. A 2021 report found TDR data to be inaccurate and unreliable, and GSA contracting personnel had not been using the data to negotiate or determine prices. Another 2022 report found that GSA contracting personnel used flawed methodologies and practices when using the 4P pricing tool to analyze costs. Lastly, a 2019 report noted that GSA contracting personnel used flawed methodologies and practices when using other pricing tools to perform analyses.