The ten most significant A-76 rule changes are:

1. No More "Direct Conversions" in Lieu of "Streamlined Competitions"
   Agencies (except the Department of Defense and Bureau of Indian Affairs) will no longer be permitted to use Direct Conversion outsourcing. New language has been added to require a streamlined competition consisting of a cost and performance evaluation against market benchmarks or expedited bids. Cost comparisons can now be as simple as quoting a bidder's price and filling out a one-page form. To improve accountability, agencies will have a mere 90 days to complete these "Streamlined Competitions."

2. 12-Month Time Limits and Sanctions on Competitions
   In full public-private competitions, agencies will now have to meet a strict 12 month deadline-with a possible 6 month extension under certain circumstances. The term begins when the agencies make the public announcement of a managed competition on an agency activity or function. In an important development, if the in-house bid does not meet this timeline the in-house team will be removed from the competition.

3. "Best Value" Standards Using Cost/Technical Tradeoff or Lowest Price Technically Acceptable Methods
   The new guidance embraces the concept of "best value" and recognizes that the cheapest choice is not always the best choice. Performance and quality now factor heavily into the sourcing decision as well as cost efficiencies. In fact, for streamlined competitions, cost must constitute 50% of the evaluation with performance standards being used for the other 50%.

4. Changes to Cost Estimates and Evaluations to Ensure "Cost Realism"
   It has been a common problem in the former process that cost estimates for competitions have been unreliable and took far too long to compile. This change seeks to ensure a "cost realism" to better calculate costs for competitions as well as evaluate actual costs of contracts to prevent vendors from exceeding their original quote.

5. New Classification Rules for FAIR Act Inventories
   An inherently governmental inventory now has to be submitted by agencies with the commercial inventory, both being published. The new guidelines allow for the challenging of the designation of "Commercial Reason Code A", about 500,000 of the 850,000 commercial activities in the FAIR inventory. This forces agencies to provide written justification in their reporting.

6. Performance Standards and Innovation Incentives in the PWS/QASP
   This encourages the inclusion of performance standards and departures from the solicitation to encourage bidders from agency and private sources to be innovative in their PWS/QASP.

7. Enhanced Contract Monitoring and Accountability
   This is to ensure that the performance of a contract does not become stale after the period of performance has begun. ALL parties, including in-house winners, are to be held accountable for the promised level of performance. In a significant development, federal employees that win competitions will be subject to a binding performance-based contract based on the cost and quality terms of their winning bid.

8. Regular Re-competition of Agency Activities
   A regular re-competition cycle has been added to ensure that the best party is servicing the contract. This provision-which applies to employee wins and vendor wins-will guarantee that the government is receiving the best possible performance for a contract.

9. Streamlined "Tradeoff Source Selection" Competitions for IT and Other Activities Under the FAR
   For information technology functions, activities widely provided by private vendors, and new agency activities, the revised guidelines provide for a tradeoff source selection evaluation of competitive bids. Under this process, an agency can weight its evaluation more heavily towards performance standards-and to encourage innovation, a bidder can devise alternative ways to achieve performance.

10. New Competitive Sourcing Staffing Requirements
    The revised guidelines define clear roles and responsibilities for key players in a competitive sourcing initiative-including a new role for human resource managers. The definition of roles and responsibilities-complete with including competitive sourcing goals in the evaluations of senior executives-provide enhanced accountability throughout the process.