TESTIMONY BY THE DIRECTOR OF LOGISTICS BEFORE THE SENATE GOVERNMENT AFFAIRS SUBCOMMITTEE ON FEDERAL SPENDING PRACTICES AND OPEN GOVERNMENT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP83-00156R000300020099-5
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 6
• Document Creation Date: December 15, 2016
• Document Release Date: October 7, 2003
• Sequence Number: 99
• Publication Date: June 14, 1979
• Content Type: MF

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DD/A ROOM
9~~/~~ spry
4 JUN 1979
MEMORANDUM FOR: Chief, Manageme t Support Staff, OLC
VIA: Director of Logistics
AT
FROM:
ie_, Supply Division, OL
SUBJECT: Testimony by the Director of Logistics
Before the Senate Government Affairs
Subcommittee on-Federal Spending
Practices and. Open Government
REFERENCE: Memo dtd 17 May 79 to C/MSS/OLC fm C/SD/OL,
same subject (OL 9 1997)
1. As agreed during our meeting of 1 June, we have
revised the subject testimony to reflect the following changes
and have attached the revised version thereof:
a. In paragraph 1, words such as "generally comply,"
"appropriate," and other similar terms have been deleted
and more'specific terminology used.
b. In paragraphs 2 and 3, the phrase "GSA pressure"
has been deleted and "GSA insistence" has been substi-
tuted since it is more accurate and more easily documented.
c. The fourth sentence of paragraph 2 has been
deleted as being unnecessary.
d. Paragraph 3 has been broken into two paragraphs:
one giving our philosophical concerns and the second
giving those concerns which relate specifically to Art
Metal.
e. Paragraph 4 has been dropped based on the premise
that "if the question isn't asked, don't answer it."
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SUBJECT: Testimony by the Director of Logistics Before the
Senate Government Affairs Subcommittee on Federal
Spending Practices and Open Government
2. We await your advice as to when the proposed hearing
will be held.
ST
cc: DDA
D/Sec
D/ L
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OPENING STATEMENT BY D/L BEFORE SUBCOMMITTEE
ON FEDERAL SPENDING PRACTICES AND OPEN GOVERNMENT
Prepared 12 June 1979
1. Notwithstanding the many instances of truly outstanding
and professional support provided to the Agency by the Federal
Supply Service (FSS) of the General Services Administration (GSA),
there have been two basic areas of contention between GSA and
this Agency regarding the products and services provided. The
first, concerns the acquisition of security filing cabinets
(safes) for use by the Agency both domestically and abroad. GSA
has contended that safes provided by the Hillside (now Art Metal)
Company comply with Federal Specification AA-F-358e and precedent
and subsequent versions thereof while this Agency and several
other agencies have maintained that such safes rarely conform to
the requirements of this specification. The second area of
contention with GSA concerns the use of single-award contracts.
GSA has maintained, since the mid-1960's, that a single-award
contract should be established for such safes, while this Agency,
the Interagency Advisory Committee on Security Equipment, and
several other agencies have maintained that it is not in the
best interest of,the Federal Government to make a single-award
contract. Our experience with GSA in these areas is summarized
in this statement. Correspondence between this Agency and GSA,
test reports, minutes of interagency meetings, and other
documentation supporting the statements contained. herein have
been made available to subcommittee staff members.
2. Regarding the conformance of Art Metal's safes with
Federal Specification AA-F-358e, our concern has been for both
the safety of individuals using this equipment and the capability
of this equipment to provide secure storage for classified
documents. Agency records indicate that as early as 1964 a
number of Art Metal safes were provided by GSA and were rejected
for failing to meet applicable specifications. Then, in
September of 1969, an additional 130 Art Metal Class VI safes
were provided by GSA. Independent examinations of these safes
by Agency inspectors, inspectors of GSA, and Department of
Defense (Doll) inspectors, all clearly showed that the safes
failed to meet personal safety and security specifications.
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Documentation from this period indicates that despite repeated
requests from Agency to GSA personnel that deficiencies in these
safes be corrected, only one effort was made by the manufacturer
to do so, and this effort failed to correct many of the defi-
ciencies. Moreover, notwithstanding the fact that the defi-
ciencies were not corrected, GSA inspectors continued to insist
that the safes should be accepted by the Agency. Ultimately,
out of frustration at ever having the deficiencies corrected,
we did accept the safes. In November of that same year, another
60 Art Metal Class V safes were received by the Agency, and our
experience with the correction of defects and GSA insistence
that we accept the safes was basically a repeat of that
described above. As a result of these experiences, the Agency
took steps to ensure that the safes of other manufacturers were
procured for use by the Agency. This act in itself generated
additional. correspondence from GSA questioning our resistance
to the procurement of Art Metal safes; and, in response thereto,
in 1975 the Agency ordered several additional Art Metal. safes
for evaluation. These safes, too, failed to meet Federal
specifications; and,since that date, no further Art Metal safes
have been accepted for use by this Agency. Those safes which
were accepted by the Agency in earlier years were restricted to
use to domestic installations only, where the level of security
protection is higher than that normally provided outside the
United States.
3. The second area of disagreement with GSA concerned
GSA's proposed designation of a single-award contractor for all.
safes. GSA made strenuous efforts in this direction in 1965 and
again in 1974, with somewhat less insistence being applied along
these lines in intervening years. The objection of this and
other agencies, as well as the Interagency Advisory Committee on
Security Equipment, to such a move was based on the following
considerations:
a.. That multiple-award contracts create maximum
competition between the few major safe manufacturers whose
products are sold primarily to the Government and afford
flexibility to purchase the product of another manufacturer
should the product of one manufacturer be found deficient
or be found to have been compromised.
b. That should fire, flood, or other Acts of God
affect the single-award contractor, it was unlikely that
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other sources would be available since those companies who
did not get the award would, in all probability, cease the
manufacture of such safes, the Government being the chief
buyer.
4. We also had certain other concerns regarding the
desirability of a single-award contract which resulted simply
from the fact that Art Metal was consistently suggested as the
most likely recipient of such a contract. Specifically:
a.. Agencies such as our own, DoD, and the Department
of State have to provide safe maintenance and repair
service on a worldwide basis, and, for that reason, it is
imperative that spare parts and technical assistance be
readily available. Art Metal never demonstrated that they
had such a capability.
b. Personal safety of our employees and the security
of classified information were of the utmost importance,
and Art Metal rarely met the required Federal specifications
in these areas.
5. I would be pleased to answer any further questions you
may have.
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