Summary: GAO reported in 1989 that the Department of Energy (DOE) was encouraging the use of "systems contracts" without any proof that these contracts were cost-effective. Systems contracts are used to procure commonly used items, such as office, industrial, and laboratory supplies, as needed rather than purchasing the items in bulk and storing them in inventory. GAO revisited this issue and discovered that DOE's San Francisco Operations Office has yet to implement GAO's earlier recommendations to help ensure that the use of systems contracting is in the government's best interest. As a result, since January 1990, contractors at DOE's Stanford Linear Accelerator Center and the Lawrence Berkeley Laboratory have spent more than $2 million on office supplies without any assurance that the contracts are cost-effective. The San Francisco Operations Office also has not determined whether controls over systems contracts are adequate at the Stanford and Berkeley facilities. During a nine-month period in 1992, Stanford and Berkeley spent more than $540,000 on office supplies with no guarantee that the prices paid were competitive with prices from other suppliers.
