Use of Performance-Based Acquisitions



The purpose of this memorandum is to provide an update to our September 7, 2004 memorandum, Increasing the Use of Performance-Based Service Acquisition, which is attached for your convenience (Attachment 1), and to request that agencies submit a performance-based acquisition (PBA) management plan by October 1, 2006. The management plan should describe the agency’s current and future PBA activities that will result in an annual increase in the number of PBAs. Attachment 2 provides details on the information that should be included in your PBA management plan.

Target Achievement Level

The target achievement level is a performance goal, not a quota, designed to encourage acquisition professionals to use PBA methods to achieve results. In fiscal year (FY) 2005, numerous flexibilities were provided to assist agencies in achieving their PBA targets. As a result, many agencies used PBA methods on over 40 percent of their eligible service contract actions in FY 2005.1 Accordingly, for the remainder of FY 2006, these agencies should continue to apply PBA methods on 40 percent or more of their eligible service actions over $25,000, including contracts, task orders, modifications, and options awarded, as measured in dollars. As agencies work to achieve their targets, the focus should be on proper acquisition planning, clear definition of requirements, and effective management of PBAs to achieve results.