Angela B. Styles
Administrator, Office of Federal Procurement Policy
Office of Management and Budget
Executive Office of the President
Washington, D.C. 20503

Dear Ms. Styles:

In accordance with the Federal Activities Reform Act (P.L. 105-270), the FY 2002 Commercial Activities Inventory for the National Science Foundation (NSF) is enclosed. We have followed the guidance provided in your February 27, 2002, memorandum in preparing this report. Also enclosed are the two summary tables requested in your memorandum.

We are in the midst of awarding a comprehensive, multi-year Business Analysis that will address human capital and next-generation technology within the context of the Foundation’s core business processes. The Business Analysis is an integral part of our Administration and Management Plan (A&M), a Plan that has been discussed and negotiated with OMB over the past year. Our strategic A&M Plan is designed to address a variety of critical management issues including the staffing levels and core competencies needed to meet anticipated future work requirements. Upon its completion, our A&M Plan will serve as a framework for addressing each of the President’s Management Agenda initiatives, including competitive sourcing.

In the interim, the process we have used to compile the 2002 FAIR Act Inventory is identical to the one utilized for the past several years. Agency positions were initially screened to identify those clearly performing Federal functions (e.g., supervisors, contract oversight, financial commitment, etc.). The remaining positions were then individually analyzed, and coded or exempted as appropriate.

As noted in last year’s submission, NSF utilizes the private sector extensively to achieve its mission, and we will continue to do so in the future as warranted. Contractors perform both programmatic and administrative functions, and collectively contractors perform more than 50% of our workload. In addition, NSF utilizes approximately 40,000 volunteers each year to facilitate the merit review process.

While our Inventory lists functions that are potentially commercial we continue to be concerned that in small agencies such as ours a basic cadre of professional and administrative staff are required to effectively achieve the agency’s mission. The majority of those listed on the Commercial Inventory perform core administrative and programmatic functions supportive of research and development activities, all of which are vital to the efficient operation of the Foundation.

We are supportive of the Administration’s initiatives, but we believe that the numeric goals for competitive sourcing should take into consideration relevant factors such as agency size and prior privatization efforts. NSF is developing alternative criteria to measure progress in implementing this initiative and we look forward to working with you.

The agency point of contact for the Inventory and this report is Gary E. Scavongelli, Staff Associate, Office of Information and Resource Management. Mr. Scavongelli may be reached at (703) 292-8102 or on email at gscavong@nsf.gov.

Sincerely

Rita R. Colwell
Director

Enclosures