Summary: Poor monitoring, implementation difficulties, and weak internal controls plagued the Resolution Trust Corporation's (RTC) Western Storm project, in which RTC noncompetitively awarded a $24 million contract to reconcile asset records for 94 failed thrifts in 1992. Following Western Storm, similar shortcomings affected task order contracts at HomeFed Savings Bank in San Diego. In that case, RTC paid a contractor $7 million--about 67 cents per page for labor alone--to photocopy documents. GAO's review of task order contracts using basic ordering agreements, a contracting tool that spells out the terms for future work, showed that RTC had few assurances that field offices were complying with its policies and procedures. RTC lacked a way to ensure adequate competition for task order contracts that were awarded in response to one or two bids. GAO also found that RTC (1) did not ensure the proper use of delegated expenditure authority and noncompetitive contracting procedures and (2) made mistakes in the contractor selection process. Furthermore, RTC's task order contracts sometimes lacked provisions that would have protected the government's interest. Although RTC has revised its contracting manual and started additional contract oversight programs, better controls are needed. RTC has revised its guidance to define acceptable competition for task order contractors, which should increase the flexibility that RTC staff have in determining the extent of competition. To ensure that this flexibility does not result in few responsive bidders, RTC needs to closely monitor the contractor selection process.
