CIA Contractors: Double or Nothin'

Congress is finally beginning to take the issue of outsourcing in the Intelligence Community seriously.   The joint Senate-House Conference Report on the Intelligence Authorization Act for FY 08 addresses several contractor issues, but it's only a start, a start that includes a comprehensive report on Intelligence Community contractors. (The conference report was adopted by the House on 12/13 and is expected to soon be approved by the Senate.)

By limiting the number of positions within the Intelligence Community while adding funds for services, Congress set the stage for the wide scale outsourcing we see today, with some 70% of the de facto workforce of the CIA's National Clandestine Service made up of contractors.  After years of contributing to the increasing reliance upon contractors, Congress is now providing a framework for the conversion of contractors into federal government employees--more or less.

The Director of National Intelligence has been granted the authority to increase the number of positions (FTEs) on elements in the Intelligence Community by up to 10% should there be a determination that activities performed by a contractor should be done by a US government employee.  (This determination has to be approved by the DNI.) The larger issue of how to lure well compensated individual contractors away from private employers is predictably not addressed although they do seem to be aware that contractors pay much better.  (The average cost of a civilian federal employee is $126,500 in contrast with the $250,000 average cost of a core contractor--double or nothin'.  Average wages of a contractor vs. an employee are unknown, except anecdotally.)

The Office of the Director of National Intelligence itself is limited to a 5% increase in government positions under the conversion program.  The ODNI has been highly criticized for its large staff and this is almost assuredly meant as a shot across the bow.  However, it's a poorly aimed one, giving that the ODNI, led by the former Chairman of the Intelligence Industry's trade group, is the Intelligence Community's biggest proponent of contracting.  The ODNI is unlikely to push against a 5% ceiling, let alone a higher one.

More significantly, Congress is requiring the DNI to produce a detailed report by March 31, 2008 on the Intelligence Community's reliance upon contractors.  This is similar to the human capital inventory that the DNI suddenly classified last April in order to hide the damning numbers.  I strongly suspect that the Congressional query probes deeper than the censored study did, as Congress is requiring the DNI to address a wide scope of issues, including:

• different standards for government employees and contractors;
• contractors providing similar services to government workers;
• analysis of costs of contractors vs. employees;
• an assessment of the appropriateness of outsourced activities;
• an estimate of the number of contracts and contractors;
• comparison of compensation for contractors and government employees,
• attrition analysis of government employees;
• descriptions of positions to be converted back to the employee model;
• an evaluation of accountability mechanisms;
• an evaluation of procedures for "conducting oversight of contractors to ensure
  identification and prosecution of criminal violations, financial waste, fraud, or other abuses committed by contractors
  or contract personnel;" and
• an "identification of best practices of accountability mechanisms within service contracts."

In order to truly understand the extent of contracting in the Intelligence Community, Congress missed the obvious:  disclosure of which company is contracted to produce the study, including a list of firms of all green badgers who work on the project.