The Defense Facilities Directorate (DFD) competed the services provided by the Pentagon Heating and Refrigeration Plant (PHRP) under the requirements of OMB A-76 in 2003/2004. DFD decided early in the competitive process to include an award fee in the solicitation as a performance incentive to either the commercial firm or the government’s Most Efficient Organization (MEO) winning the competitive procurement. Although award fee contracts are commonplace, inclusion and procedures for payment to government employees of an award fee as part of an MEO, are not. In addition, DFD management wanted to ensure that if the government’s MEO won the award, the award fee would be distributed fairly and equitably among MEO employees, without preempting or taking away the employees eligibility for normal, individual performance awards.
These decisions were made in full support of the DFD strategic plan. DFD’s strategic plan focuses on providing quality services and providing the best services to its customers. An award fee would provide incentive for optimum performance of the PHRP. The PHRP provides services to approximately 25,000 civilian, military, and contractor customers on the Pentagon Reservation. DFD’s strategic plan also addresses investing in its people. If the government’s MEO won the competition, it was imperative that no current benefits were lost.
Establishing and implementing procedures to ensure senior management’s goals were achieved rested largely on two WHS offices: the Internal Review Office (IRO), DFD and the Office of General Counsel (OGC). The two offices worked out detailed procedures to ensure the award fee pool and shares to each employee were distributed equitably. The IRO and OGC developed the plan and obtained consensus among multiple offices: Personnel, Financial Management and Accounting; and, groups: the Union and MEO itself, to effect the necessary required steps.
For more information, contact Bob Cox on 703-614-3822, or by email at Bob.Cox@whs.mil.
