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And that is among the important things that considerably increases the costs. And we are talking here about federal orders. We are not talking about industrial orders. GSA is inquiring on federal orders. That information is within the federal government. I believe GSA requires to take a look at its own systems and establish a method that they can use the details already in their ownership.

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Mr. Stanford, some have actually argued that the GSA will use this new info to make businesses-- require them to decrease their rates if they feel the supplier is no longer offering a competitive cost. Little organization margins, as numerous of you mentioned, are extremely low and they, at times, can not manage bulk discount rates like the big business.

STANFORD. I believe you would have 2 alternatives. Either the small service would leave the federal market if they might no longer bear the little margins to make certain they were successful. Or, as in the case for some little organizations that rely 80-90 percent of revenue in the federal market, they would go out of company.

TAKAI. Okay. Thank you (GSA SER). And my last concern, and I believe much of you discussed this, pertains to the inability of GSA to really figure this thing out themselves due to their old-fashioned computer system. I simply desired to dig a little much deeper, and possibly, Mr. Horan, you can invest some time talking about that comment you made in your testimony about it would be simply simpler for them to upgrade their system so that they can track and keep an eye on the information that they are requesting on their side, rather than leave it to the concern of the little businesses.

I am not specific it will be much easier, but it will be certainly-- they would have to face some of the same complexities that they are ready to impose on contractors. The point I was trying to make is that GSA, likely preparing for the criticism that they are enforcing this obligation on professionals, took a look at their system and suggested in the function itself the preference to the guideline modifications that their systems would need changes since all this data is not contained in a single spot and they would have to undergo the effort.

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So they hesitated to take that cost regardless of the data being similarly available to GSA as the professionals, and want to impose that on professionals. GSA having access to this info though might easily produce a database or customize databases to do exactly what they wish to do.

They are just unwilling to incur that expenditure. Mr. TAKAI. Anyone have anymore comments concerning this specific concern? Mr. WALDRON. Yes. I do not understand if it is the irony of the scenario or not, is that GSA is going to have to invest money to build systems in any occasion.

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So why do they not have a look internally and see what is most efficient for them, for the government to try to determine to handle its own data. Since they are going to have to develop systems. We are talking, when you talk about regular monthly reporting throughout the GSA Schedules program, you are broaching hundreds of thousands of transactions, millions and countless data elements to be reported, accessed, collected.



Just a couple other points. With regard to the gain access to, the concern was excellent about, you understand, with current occasions, security of the private info, you know, there is even another area, and GSA did not-- I believe the general public meeting that was held on the guideline, they gained an appreciation of the level of concern throughout market with regard to this problem, and even because context they have professionals supporting their effort.

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And finally, simply a believed on the concern about whether people would have to leave, you understand, if they are told lower your rate, we get reports frequently of business being asked to either lower their cost or eliminate the item from the contract. And the GSA leadership is taking the position that that is not, and they have, to their credit, have actually stated that is not the goal here from their point of view, but at the working level and the operational level, contracting officers nearly daily are asking companies to either lower their rate due to the fact that they discovered a lower price on a horizontal contrast.

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Do you suggest to say-- is that not in an odd way collusion, understanding someone else's rate and calling somebody else and saying-- another bidder for the same item and stating, "You are too high, lower your price"? I believe it is not great procurement policy since in this problem, you get into the relative terms and conditions, and is somebody an authorized reseller; are they not an authorized reseller? These are things-- due thorough things that GSA needs to be looking at.

And it appears like GSA is focusing so much on the contract level rate at this level. When the rate is paid is at the task order level, which is the level listed below competition under the contracts. And the focus is more on this instead of let us get the best, you understand, an excellent rate and a best worth solution at the job order level.

How do you enhance, simplify, and accept competitors at the task order level so that the American people, customer companies get finest worth products and solutions-- business best products and services. Chairman HANNA. They are asking for something that they are not prepared to take from a group of professionals who will incur huge expenditure and eventually GSA would likewise sustain a massive expense to accept this, and yet currently admits it does not have the capability really to utilize it.

Our members oppose this rule. We believe GSA needs to start over from scratch and look internally. GSA conducting its own internal pilot of gathering its own info or other info of other agencies and seeing how-- first of all, what data components are really important?

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And to the extent they are using it to compare to agreement pricing, as I stated previously in the testament and we explain in our written statement, that is apples and, I do not understand, watermelons. It is such a complete difference in terms of the terms. GSA SER.

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