TSA contract heats up

Next phase of competition under way for a $2 billion IT infrastructure prize

Contractors eligible for the Transportation Security Administration infrastructure contract are all part of
Category 2 of the Enterprise Acquisition Gateway for Leading Edge Solutions procurement vehicle.

LARGE COMPANIES:

Computer Sciences Corp.

EDS Corp.

General Dynamics Corp.

Lockheed Martin Corp.

Northrop Grumman Corp.

Science Applications International Corp.

Unisys Corp. (incumbent)


SMALL BUSINESSES:

TIER 1

3H Technology LLC

Aerient LLC

Analytical Services and Materials Inc.

Energy Enterprise Solutions LLC

SCI Consulting Inc.

Visionary Integration Professionals LLC


TIER 2

Abacus Technology Corp.

Arrowhead Global Solutions

CACI Technology Insights Inc.

Catapult Technology Limited

The Centech Group Inc.

Pragmatics Inc.

QSS Group Inc. (now part of Perot Systems)

STG Inc.

Trawick

TWD and Associates Inc.

Bidders and prospective subcontractors are
lining up to be part of the Transportation
Security Administration's massive
$2 billion Information
Technology Infrastructure Program (ITIP).
The procurement is considered one of the
largest and highest-profile IT contracts this
year for the Homeland Security Department.

The TSA IT infrastructure contract is a
follow-on to the $1 billion IT Managed
Services contract, which aims to install and
modernize IT networks and infrastructure.
Unisys Corp. held the contract from 2002 to
2006. The company then won a bridge contract
to extend the work through 2008.

Unisys has submitted a bid for the new contract,
said spokesman Brad Bass. "This has
been a very successful contract for Unisys, and
we would like to continue the relationship," he
said.

Industry experts are closely watching the
opportunity because it provides basic IT infrastructure
for TSA, primarily in creating and
linking computer networks between TSA and
airports, presumably laying the groundwork
for further agency IT work down the road.

"The TSA ITIP contract is in a sweet spot of
IT architecture and networks," said Jeremy
Potter, senior analyst at Input Inc., a market
research firm. "It is not mission-focused, in
which you might have timing and priority
issues. This is very basic IT ... modernizing the
IT backbone."

Even with those aspects in its favor, the
project could be at risk. DHS infrastructure
projects were placed on the Office of
Management and Budget's High Risk IT
Project list in April.

Nonetheless, TSA's IT infrastructure project
is moving forward. After months of anticipation,
TSA issued the request for proposals
April 17, and bids were due May 14, said Ann
Davis, a TSA spokeswoman. The value is estimated
at $2 billion, she said.

Eligible companies are
Category 2 operations and maintenance contractors
on the department's Enterprise
Acquisition Gateway for Leading Edge
Solutions procurement vehicle, Davis said.
Those eligible include seven large contractors,
counting Unisys, and 16 small businesses. She
declined to provide information on which
companies have submitted bids.

Among the seven large Category 2 companies,
Lockheed Martin Corp. officials have
confirmed that they have submitted a bid.
Lockheed Martin executives recently created a
Web site, LM4TSA.com, dedicated to the ITIP
contract.

Northrop Grumman IT spokeswoman Juli
Ballesteros confirmed the company is "looking
at the opportunity with interest." General
Dynamics declined to comment, and several
other companies did not respond to requests
for comment.

"We have gotten quite a lot of interest in
this from vendors," Potter said. "The size of the contract suggests there will be teaming
relationships."

Potter said he believes the majority of the
Category 2 large companies probably will bid,
and he thinks Unisys stands a good chance.

"With their previous win and their relationships,
Unisys is just as well-positioned as anyone,"
Potter said.

Industry sources expect a prequalification
the week of May 26 and a request for a second
round of proposals in June, with a final award
to be made in August.

The program has been challenging. Unisys
was hired to connect TSA IT networks at hundreds
of airports. In February 2006, DHS'
inspector general recommended rebidding the
Unisys contract. According to the IG's report,
although TSA initially expected the work to
extend through 2009, Unisys had spent the
bulk of the funding, $834 million, by the end
of fiscal 2005. "TSA spent most of the contract
ceiling without receiving many of the contract
deliverables critical to airport security and
communications," the IG said.

However, TSA and Unisys defended the
original contract and performance. In 2005,
TSA awarded Unisys the bridge contract to
continue working.

"Unisys is proud of the work and accomplishments
we have performed for TSA, and
TSA has given us consistently high marks for
performance. TSA has said publicly that the
issues raised in the inspector general's report
had been addressed and that they consider the
matter closed," said Unisys in a March 2007
statement.

Nonetheless, the IG has continued to raise
concerns. As of May 2007, TSA had been 70
percent successful in creating high-speed connectivity
to passenger-screening areas in airports
and 57 percent successful in implementing
high-speed connectivity to baggagescreening
locations, according to an IG report
issued in November 2007.

In addition, House Homeland Security
Committee Chairman Bennie Thompson (DMiss.)
held a hearing in September 2007 to
investigate allegations that Unisys failed to protect
the department's networks against Chinese
hackers and attempted to hide evidence related
to those attacks. The allegations also blame DHS
officials for failing to act on information provided.
At the hearing, Unisys said it performed
according to protocol and acted in good faith.

Alice Lipowicz (alipowicz@1105govinfo.com) is a
staff writer at Washington Technology.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

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