The following is a list of definitions related to Circular A-76.

Definition of Terms

Activity.  A specific task or grouping of tasks that provides a specialized capability, service or product based on a recurring government requirement.  Depending on the grouping of tasks, an activity may be an entire function or may be a part of a function.  An activity may be inherently governmental  or commercial in nature.

Adversely Affected Employees.  Federal civilian employees serving competitive or excepted service appointments in Tenure Groups I, II, or III, who are identified for release from their competitive level by an agency, in accordance with 5 C.F.R. Part 351  and 5 U.S.C. Chapter 35, as a direct result of a performance decision resulting from a streamlined or standard competition. 

Agency Cost Estimate.   The part of the agency tender in a standard competition  that includes the agency’s cost proposal and represents the full cost of agency performance of the commercial activity, based on the requirements in the solicitation and the costing policy in Attachment C.  The agency cost estimate  for a streamlined competition  is developed in accordance with Attachments B and C.

Agency Performance.  Performance of a commercial or inherently governmental  activity with government personnel.  Often referred to as “in-house performance.”

Agency Source.  A service provider  staffed by government personnel.

Agency Tender.  The agency management plan submitted in response to a solicitation for a standard competition.  The agency tender includes an MEO, agency cost estimate, MEO quality control plan, MEO phase-in plan, and copies of any MEO subcontracts (with the private sector  providers’ proprietary information  redacted).  The agency tender is prepared in accordance with Attachment B and the solicitation requirements. 

Agency Tender  Official  (ATO).  An inherently governmental  agency official with decision-making authority  who is responsible for the agency tender and represents the agency tender during source selection.

Annualize.  The calculation method to convert a cost to an annual basis.  The calculation converts a cost for a performance period that is less than one full year into an annual cost to correctly reflect the cost in a government cost estimate.  This calculation is performed by first dividing the cost in the performance period by the number of days in the performance period to determine the corresponding daily cost and then multiplying the daily cost by 365.25 days to determine the annualized cost.  To account for leap years, 365.25 is the average number of days in a year.

Basic Pay.  Basic pay  for GS employees is a position’s annual salary plus any other applicable civilian employee pay entitlements.  Basic pay for FWS  employees is a position’s annual wages including shift differential pay and environmental pay, plus any other applicable civilian employee pay entitlements.  Examples of other civilian employee pay entitlements include, but are not limited to, night differential pay  for FWS employees, environmental differential pay, and premium pay  (for civilian employee fire fighters and law  enforcement officers). 

Capital Improvement.  An expenditure for a physical improvement to an existing capital asset  such as additions and major alterations that are intended to improve performance or increase useful life.

Civilian Employee.  An individual who works for a federal agency on an appointment without time limitation who is paid from appropriated funds, which includes working capital funds.  A foreign national employee, temporary employee, term employee, non-appropriated fund employee, or uniformed personnel is not included in this definition.

Commercial Activity.  A recurring service  that could be performed by the private sector.  This recurring service is an agency requirement that is funded and controlled through a contract, fee-for-service agreement, or performance by government personnel.  Commercial activities may be found within, or throughout, organizations that perform inherently governmental  activities or classified  work. 

Common Costs.  Specific costs identified in the solicitation that will be incurred by the government regardless of the provider (private sector, public reimbursable, or agency).  Common costs are sometimes referred to as wash costs.  Examples of common costs  include government-furnished property, security clearances, and joint inventories. 

COMPARE.  The windows-based A-76 costing software that incorporates the costing procedures of this circular.  Agencies must use COMPARE to calculate and document the costs on the SLCF  for a streamlined competition  or the SCF  for a standard competition.  The software is available  through the SHARE A-76! web site at   http://emissary.acq.osd.mil/inst/share.nsf/.

COMPARE  Version Control Log.  The document that describes each of the changes made in a particular version of the COMPARE software.  This document includes a brief description of the change, the area of the software program affected by the change, and the impact the change has on the SCF/SLCF  and/or documentation.

COMPARE  User's Guide.  A detailed guidebook for actual users of COMPARE that includes an in-depth explanation of the use and features of the COMPARE software program.

COMPARE  Tables.  A specific set of master tables incorporated into the COMPARE costing software that includes all of the approved standard cost factors  and rates used to calculate the SCF/SLCF  costs.

Competition.  A formal evaluation of sources to provide a commercial activity  that uses pre-established rules (e.g., the FAR, this circular).  Competitions between private sector  sources are performed in accordance with the FAR.  Competitions between agency, private sector, and public reimbursable sources are performed in accordance with the FAR and this circular.  The term “competition,” as used in this circular includes streamlined and standard competitions performed in accordance with this circular, and FAR-based competitions for agency-performed activities, contracted services, new requirements, expansions of existing work, and activities performed under fee-for-service agreement.  The term also includes cost comparisons, streamlined cost comparisons, and direct conversions  performed under previous versions of OMB Circular A-76.

Competition  File.  The documents used in a standard competition  in addition to the government contract files required by FAR Subpart 4.8.  Agencies maintain this file regardless of the source selected to perform the activity.

Competition  Officials.  The agency officials appointed before a standard competition  is announced.  These individuals perform key roles and have essential responsibilities for the successful completion of the standard competition.  Competition officials are the agency tender official, contracting officer, source selection authority, human resource advisor, and PWS  team leader.

Competitive Sourcing Official (CSO).  An inherently governmental  agency official responsible for the implementation of this circular within the agency.

Component.  An organizational grouping within an agency, such as a bureau, center, military service, or field activity.

Contracting Officer  (CO).  An inherently governmental  agency official who participates on the PWS  team, and is responsible for the issuance of the solicitation and the source selection evaluation methodology.  The CO awards  the contract and issues the MEO  letter of obligation  or fee-for-service agreement resulting from a streamlined or standard competition.  The CO and the SSA  may be the same individual.

Conversion From Contract.  A change in the performance of a commercial activity  from a private sector  provider to agency performance.

Conversion To Contract.  A change in the performance of a commercial activity  from agency performance to a private sector  provider.

Depreciation.  The decline in the value of a capital asset.  Depreciation represents a cost of ownership and the consumption of an asset’s useful life.

Direct Labor.  Manpower resources dedicated to performing the requirements of the solicitation and labor for supervision and management related support to the tender (e.g., MEO) such as labor for quality control.

Directly Affected Employees.  Civilian employees whose work is being competed in a streamlined or standard competition.

Directly Affected Government Personnel.  Government personnel whose work is being competed in a streamlined or standard competition.

Directly Interested Party.  The agency tender official who submitted the agency tender; a single individual appointed by a majority of directly affected employees  as their agent; a private sector  offeror; or the official who certifies the public reimbursable tender.

Divestiture.  An agency’s decision to eliminate a government requirement for a commercial activity.  No service contract or fee-for-service agreement exists between the agency and the private sector  after a divestiture.  By divesting of a commercial activity, an agency elects not to control the activity and cedes ownership and control of the activity’s associated assets (e.g., equipment, facilities, property) and resources (agency manpower and budgeting for the activity).  The agency has no role in the financial support, management, regulation, or oversight of a divested activity.  Moving, transferring, or converting a commercial activity from government performance to private sector or public reimbursable performance is not a divestiture.

Employee  Transition Plan.  A written plan developed by the HRA  for the potential transition  of the agency’s civilian employees to an MEO, or to private sector  or public reimbursable performance.  This plan is developed early in the streamlined or standard competition  process, based on the incumbent government organization, to identify projected employee impacts and the time needed to accommodate such impacts, depending on the potential outcomes of the competition.  The employee transition plan differs from a phase-in plan, which is developed by prospective providers responding to a solicitation.

End date.  The end date  for a streamlined or standard competition  is the date that all SCF  certifications are completed, signifying an agency’s performance decision.

Expansion.  An increase in the operating cost of an existing commercial activity  based on modernization, replacement, upgrade, or increased workload.  An expansion of an existing commercial activity is an increase of 30 percent or more in the activity’s operating costs (including the cost of FTEs) or total capital investment.

FedBizOpps.gov.  The website where the government electronically advertises solicitations or requirements.

Fee-for-Service Agreement.  A formal agreement between agencies, in which one agency provides a service (a commercial activity) for a fee paid by another agency.  The agency providing the service is referred to in this circular as a public reimbursable source.

First Period of Full Performance.  The performance period following the phase-in period  when the service provider  becomes fully responsible for performing the activity.  The first performance period is used to implement the new service provider’s phase-in plan; therefore, full performance of the service provider does not occur until the second performance period, which may be referred to as the base period, full performance, or the first period of full performance.  This first period of full performance may be less than or more than 12 months.  The first period of full performance is the second performance period (the performance period immediately following phase-in period) regardless of the second performance period’s length.

Foreign National  Employee.  An employee that is not a United States citizen who is employed by the United States Government and works outside the United States, its territories or possessions, under a system in which an Executive Agency is the official employer of the foreign national employee and assumes responsibility for all administration and management functions associated with the employee’s employment.

Full-Time Equivalent (FTE).  The staffing of Federal civilian employee positions, expressed in terms of annual productive work hours  (1,776) rather than annual available hours that includes non-productive hours (2,080 hours).  FTEs may reflect civilian positions that are not necessarily staffed at the time of public announcement and staffing of FTE positions may fluctuate during a streamlined or standard competition.  The staffing and threshold FTE requirements stated in this circular reflect the workload performed by these FTE positions, not the workload performed by actual government personnel.  FTEs do not include military personnel, uniformed services, or contract support.

Function Code.  The numerical code used to categorize an agency’s commercial and inherently governmental  activities for inventory reporting purposes.

Government Furnished Property (GFP).  Facilities, equipment, material, supplies, or other services provided by the government for use by all prospective providers in the solicitation.  Costs for GFP included in a solicitation are considered common costs.  Replacement costs, insurance, maintenance and repair costs for GFP may or may not be government-furnished, depending on the provisions in the solicitation.

Government Personnel.  Civilian employees, foreign national employees, temporary employees, term employees, non-appropriated fund employees, and uniformed services personnel  employed by an agency to perform activities.

Human Resource Advisor  (HRA).  An inherently governmental  agency official who is a human resource expert  and is responsible for performing human resource-related actions to assist the ATO  in developing the agency tender.

Incumbent Service Provider.  The source (i.e., agency, private sector, or public reimbursable source) providing the service when a public announcement is made of the streamlined or standard competition.

Information Technology.   Any equipment or interconnected system(s) or subsystem(s) of equipment used in the automatic acquisition, storage, manipulation, management, movement, control, display, switching, interchange, transmission, or reception of data or information by the agency.  For purposes of this definition, equipment is used by an agency if the equipment is used directly by the agency, or is used by a contractor under a contract with the agency that requires (1) its use or (2) to a significant extent, its use in the performance of a service or the furnishing of a product.  The term "information technology" includes computers, ancillary equipment, software, firmware and similar procedures, services (including support services), and related resources, and does not include any equipment that is acquired by a contractor incidental to a contract; or contains imbedded information technology that is used as an integral part of the product, but the principal function of which is not the acquisition, storage, manipulation, management, movement, control, display, switching, interchange, transmission, or reception of data or information.  For example, heating, ventilation, and air conditioning equipment, such as thermostats or temperature control devices, and medical equipment where information technology is integral to its operation, are not information technology.

Inherently Governmental Activities.  An activity that is so intimately related to the public interest as to mandate performance by government personnel  as provided by Attachment A.

Interested Parties.   For purposes of challenging the contents of an agency’s commercial activities inventory pursuant to the Federal Activities Inventory  Reform Act, an interested party is (1) a private sector  source that is an actual or prospective offeror for a contract or other form of agreement to perform the activity and has a direct economic interest in performing the activity that would be adversely affected by a determination not to procure the performance of the activity from a private sector source; (2) a representative of any business or professional association that includes within its membership private sector sources referred to in (1) above; (3) an officer or employee of an organization within an executive agency that is an actual or prospective offeror to perform the activity; (4) the head of any labor organization referred to in section 7103(a)(4) of title 5, United States Code, that includes within its membership officers or employees of an organization referred to in paragraph (3).

Inventory.  A list of government personnel, by location, function, and position, performing either commercial activities or inherently governmental  activities.

MEO  Letter of Obligation.  A formal agreement that an agency implements when a standard or streamlined competition  results in agency performance (e.g., MEO).

MEO  Subcontracts.  Contracts between an agency and the private sector  that are included in the agency tender or fee-for service agreements with a public reimbursable source that are included in the agency tender.  In addition to the cost of MEO subcontracts, agency or public reimbursable cost estimates must include support costs associated with MEO subcontracts such as government-furnished property, and contract administration, inspection, and surveillance.

MEO  Team.   A group of individuals, comprised of technical  and functional experts, formed to assist the ATO  in developing the agency tender.

Military Personnel.  Officers [as defined in 10 U.S.C. § 101(b)(1)] and enlisted members [as defined in 10 U.S.C. § 101(b)(6)] of the military services (defined as the Army, Navy, Air Force, and Marine Corps).

Most Efficient Organization  (MEO).  The staffing plan  of the agency tender, developed to represent the agency’s most efficient and cost-effective organization.  An MEO is required for a standard competition  and may include a mix of government personnel  and MEO subcontracts.

New Requirement.   An agency’s newly established need for a commercial product or service that is not performed by (1) the agency with government personnel; (2) a fee-for-service agreement with a public reimbursable source; or (3) a contract with the private sector.  An activity that is performed by the agency and is reengineered, reorganized, modernized, upgraded, expanded, or changed to become more efficient, but still essentially provides the same service, is not considered a new requirement.  New ways of performing existing work are not new requirements.

Non-Pay Categories of Costs.  Costs in a cost estimate that are not related to pay.  Non-pay categories of costs include, but are not limited to, materials, supplies, equipment, facilities, capital assets, and minor items and the inflation for these costs.

Offer.  A private sector  source’s formal response to a request for proposals or invitation for bid.  The term “offeror” refers to the specific source rather than the response.

Overhead.  Overhead includes two major categories of cost, operations overhead and general and administrative overhead.  Operations overhead includes costs that are not 100 percent attributable to the activity being competed but are generally associated with the recurring management or support of the activity.  General and administrative overhead includes salaries, equipment, space, and other tasks related to headquarters management, accounting, personnel, legal support, data processing management, and similar common services performed external to the activity, but in support of the activity being competed.  A standard twelve percent overhead factor is an estimated federal agency overhead factor that is calculated in agency and public reimbursable cost estimates for streamlined and standard competitions. 

Past Performance.  An indicator that may be used in the source selection process  to evaluate a prospective provider’s previous performance on work comparable to that being competed, for the purpose of predicting the quality of future performance relative to other offers or public reimbursable tenders.  FAR 42.1501 describes the information used to evaluate past performance, and FAR 15.305(a)(2) provides guidance for the consideration of past performance in the source selection process.

Pay Categories of Cost.  Costs in a cost estimate associated with the payroll for government personnel, including inflation.

Performance Decision.  The outcome of a streamlined or standard competition, based on SLCF  or SCF  certifications. 

Performance Standards.  Verifiable, measurable levels of service in terms of quantity, quality, timeliness, location, and work units.  Performance standards are used in a performance-based PWS  to (1) assess (i.e., inspect and accept) the work during a period of performance; (2) provide a common output-related basis for preparing private sector  offers and public tenders; and (3) compare the offers and tenders to the PWS.  The requiring activity’s acceptable levels of service are normally stated in the PWS.  The solicitation includes performance standards. 

Performance Work Statement  (PWS).  A statement in the solicitation that identifies the technical, functional, and performance characteristics of the agency’s requirements.  The PWS is performance-based and describes the agency’s needs (the “what”), not specific methods for meeting those needs (the “how”).  The PWS identifies essential outcomes to be achieved, specifies the agency’s required performance standards, and specifies the location, units, quality and timeliness of the work.

Phase-in Plan.  A prospective provider’s plan to replace the incumbent provider(s) that is submitted in response to the solicitation.  The phase-in plan is implemented in the first performance period and includes details on minimizing disruption, adverse personnel impacts, and start-up requirements.  The phase-in plan is different from the employee transition  plan developed by the HRA.

Privatization.  A federal agency decision to change a government-owned and government-operated commercial activity  or enterprise to private sector  control and ownership.  When privatizing, the agency eliminates associated assets and resources (manpower for and funding of the requirement).  Since there is no government ownership and control, no service contract or fee-for-service agreement exists between the agency and the private sector after an agency privatizes a commercial activity or enterprise.  Moving work from agency performance with government personnel  to private sector performance where the agency still funds the activity is not privatization.

Prospective Providers.  Private sector, public reimbursable, and agency sources that may submit responses (offers or tenders) in response to an agency’s solicitation.

Provider.  An agency, private sector, or public reimbursable source that is performing, or will perform, a commercial activity; sometimes referred to as a service provider.

Public Announcement.  An agency’s formal declaration that the agency has made a (1) decision to perform a streamlined or standard competition, or (2) performance decision in a streamlined or standard competition.  The CO  makes these announcements via FedBizOpps.gov.

Public Reimbursable Source.  A service provider  from a federal agency that could perform a commercial activity  for another federal agency on a fee-for-service or reimbursable basis by using either civilian employees or federal contracts with the private sector.

Public Reimbursable Tender.  A federal agency’s formal response to another federal agency’s solicitation for offers or tenders.  The public reimbursable tender is developed in accordance with this circular and includes a cost estimate, prepared in accordance with Attachment C.

PWS  Team.  A group of individuals, comprised of technical  and functional experts, formed to develop the PWS and quality assurance surveillance plan, and to assist the CO  in developing the solicitation. 

Quality Assurance Surveillance.  The government’s monitoring of a service provider’s performance in accordance with the quality assurance surveillance plan and the performance requirements identified in the solicitation.

Quality Assurance Surveillance  Plan.  The government’s inspection plan.  The quality assurance surveillance plan documents methods used to measure performance of the service provider  against the requirements in the PWS.  The agency relies on the service provider to monitor daily performance using their own quality control plan, but retains the right to inspect all services.  When the agency makes a performance decision, the agency re-evaluates and modifies the existing quality assurance surveillance plan, based upon the selected provider and the selected provider’s accepted quality control plan.

Quality Control Plan.  A self-inspection plan that is included in all offers and tenders.  The quality control plan describes the internal staffing and procedures that the prospective provider will use to meet the quality, quantity, timeliness, responsiveness, customer satisfaction, and other service delivery requirements in the PWS.

Representatives of Directly Affected Employees.  In the case of directly affected employees  represented by a labor organization accorded exclusive recognition under 5 U.S.C. § 7111, a representative is an individual designated by that labor organization to represent its interests.  In the case of directly affected employees not represented by a labor organization under 5 U.S.C. § 7111, a representative is an individual appointed by directly affected employees as their representative.

Residual Value.  The estimated value of a capital asset  at the end of its useful life as determined by application of the Useful Life and Disposal Value Cost Factor.

Resources.  Funding allocated for contracts, manpower, facilities, material, or equipment to perform agency requirements.

Segregable Expansion.  An increase to an existing commercial activity  that can be separately competed. 

SHARE A-76!   The Department of Defense A-76 knowledge management system used to share knowledge, information, and experience about public-private competitions.  This public site contains A-76-related guidance, sample documents, best practices, tools, and links to other A-76 websites and sources for A-76-related information.   Users may post best practices used in public-private competitions, research A-76 through the use of search engines, and submit internet links to add to the available links in SHARE A-76!  The web site address is http://emissary.acq.osd.mil/inst/share.nsf/.

Solicitation  Closing Date.  The due date for delivery of private sector  offers, public reimbursable tenders, and the agency tender, as stated in the solicitation.

Source.  One of three specific categories of service providers (i.e., agency, private sector, or public reimbursable) that can perform a commercial activity  for an agency.

Source  Selection  Authority  (SSA).  A competition official with decision-making authority  who is responsible for source selection as required by the FAR and this circular.  The SSA and CO  may be the same individual.

Source  Selection  Evaluation Board  (SSEB).  The team or board appointed by the SSA  to assist in a negotiated acquisition.

Standard Competition Form  (SCF).  The agency form that documents and certifies all costs calculated in the standard competition.

Start Date.  The start date for a streamlined or standard competition  is the date that the agency makes a formal public announcement of the agency’s decision to perform a streamlined or standard competition.

Streamlined Competition Form  (SLCF).  The agency form that documents and certifies all costs calculated in the streamlined competition, in accordance with Attachment C.

Uniformed Services.  Members of the armed forces (i.e., Army, Navy, Air Force, Marine Corps, and Coast Guard) and other uniformed services (e.g., National Oceanic and Atmospheric Administration, Public Health Service).

Useful Life.  The estimated period of economic usefulness of a capital asset.

Please send any questions, comments, and suggestions to the Competitive Sourcing Team.