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B-198004 1 (1980-03-12)

handle is hein.gao/gaobadopl0001 and id is 1 raw text is: RELEASED 376 states General Accounting Office Office of Vshington, DC 20548 GeneralCcunsel In Reply Refer to; B-19 8004 Champion Instxunt Laboratory, Inc. _ 12 1I* P.O. Box 3381 3630 Spencer Highway pasadena, Texas 77502 Attention: * ,Jr. President Genln: We acknowledge your letter of February 29, 1980, expressing 1 concern over the Federal Aviation Administration's (FAA) develop- ment of an in-house capability for instmuent and equipment calibra- tion. We are not familiar with this particular program but offer the following general information regarding such efforts. It is the policy of the Federal Government to rely on private enterprise for its needs unless the national interest requires other- wise. Against this policy, however, nrst be balanced the various public interests in efficient Goverinrt, support of the small business sector, etc. Under the provisions of Office of Managerent and Budget Circular No. A-76, the decision whether to contract with the private sector for services or products in lieu of in-house performance depends largely on a comparison of the costs of these t70 options. The cost of contracting out is determined by the responses of potential contractors to a solicitation for the services in question; the cost of Government perfor,=ce is estimated based on criteria set by the deparment concerned. Essentially, if the evaluation shows the cost of contractor performance to be lower than the cost of in-house performnce, then a contract my be awarded to lowest-cost offeror; conversely, if the evaluation shcas the cost of contractor performance to be higher, then no czmtract is awarded and the in-house capability to perform is either developed or con- tinued, as the situation requires. The quality of the services obtained is, of course, also a consideration. We recognize that these programs have not been without problems. See, e.g., Development of a National Make-or-3uv Strategy--Proqress and Problems, Report to the Congress by the Ccrptroller General, PSAD 78-118, September 25, 1978, a copy of which wa have enclosed for is L ..