Customs Service Preps for a Faster IT Upgrade

By Nick Wakeman, Staff Writer

The race for the U.S. Customs Service's $2 billion modernization project is about to accelerate as the agency prepares to push ahead using a streamlined acquisition process.

The project to update and improve the information systems and processes the agency uses to interact with the trading community has cleared most of its congressional hurdles. In late July, the House Appropriations Committee unanimously approved a spending bill that included $105 million to start the project in fiscal 2001, which begins Oct. 1.

While final approval has not been made, "we are quietly confident," said Olga Grkavac, executive vice president of the Information Technology Association of America, an Arlington, Va., industry group whose members include all four teams bidding on the project. "There are still some procedural things to go through, but there is a lot of support."

The planned June release of the request for proposals had been delayed while Customs waited for funding approval.

With all signs now pointing to approval, the Customs Service intends to begin a streamlined acquisition process by issuing the request for proposals in mid-October. Proposals will be due in late November. Oral presentations should be in mid-December, and an award is anticipated in mid-February, according to the agency.

Chasing the contract are four teams led by Andersen Consulting of Chicago, Electronic Data Systems Corp. of Plano, Texas, IBM Corp. of Armonk, N.Y., and Logicon Inc. of Herndon, Va.

"We are very excited that this is back on track," said Robert Koch, a spokesman for Logicon. "In particular we are excited Customs is using a rapid acquisition approach."

The streamlined approach saves time and money for taxpayers and the companies involved in the bidding, said Bill Eldridge, director of federal civilian accounts for IBM.

"I can't think of anyone who doesn't benefit from this," Eldridge said.

Kevin Durkin, EDS vice president of federal sales, echoed those sentiments. "All of us worked together with ITAA to win approval from Congress, so this is really good to see," he said. "This contract is just such a great opportunity."

A major provision of the fast-track procedure is that the Customs Services will be using oral presentations for technical and management proposals rather than a written document.

Preparing for an oral presentation is just as time-consuming and intense as written proposals, but "this allows the government to make their evaluation much more quickly," Durkin said.

"Oral presentations are a much better way to evaluate the people who will be doing the work," said Lisa Mascolo, managing partner for Treasury Department work at Andersen Consulting.

"One of the things that is most important is that the government and contractor make sure they have a relationship that can work," she said.

A faster decision is good for the bidders and the agency, but also benefits the trade community, Eldridge said.

"They need better systems out there soon," he said. "These old systems just can't handle it anymore." The volume of international trade is growing at 20 percent a year, he noted.

The Customs Modernization project is an opportunity for IT companies to get in on one of the few large, agencywide modernization efforts. The $2 billion contract is expected to extend over 15 years.

The Customs Service wants to modernize and improve the systems it uses to monitor imports and exports. Some of the computer systems currently in use are up to 16 years old and are subject to brownouts, which shut or slow down trade.

Because the volume of international trade is growing rapidly, new and improved systems are critical to keep pace, government and industry officials said.

It is a project whose size and scope does not come along often, so it has attracted some of the heavy hitters in systems integration field.

Joining Andersen Consulting are Science Applications International Corp. of San Diego, Signal Corp. of Fairfax, Va., and Unisys Corp. of Blue Bell, Pa.

EDS has only publicly announced one partner, PricewaterhouseCoopers of New York.

The team being led by IBM includes Computer Sciences Corp. of El Segundo, Calif., KPMG of New York, Lockheed Martin Corp. of Bethesda, Md., and Sandler & Travis Trade Advisory Services Inc. of Miami.

Logicon has put together a team that includes Booz-Allen & Hamilton Inc. of McLean, Va., Ernst & Young of New York, Litton-PRC Inc. of McLean and Wang Government Services Inc. of McLean.

Company executives described the modernization project as an effort with two missions. On the one hand, Customs serves the international trade community trying to move goods quickly in and out of the United States. On the other, the agency also has a serious law enforcement duty to stop criminal activities such as illegal drugs, weapons, child pornography, money laundering and terrorist threats.

As part of the streamlined procurement process, Customs will be putting greater emphasis on past performance on both government and commercial work that is similar to the project.

Though the teams will not have to submit written technical and management proposals, written information on experience and past performance is still required. Oral presentations will follow an interview approach with an "intensive question-and-answer session," according to the Customs Service.

One thing unchanged from the original plan is that the proposals will be evaluated on a best value to the government and not the lowest price.

Streamlined process or not, "all of these teams are ready," Grkavac said. "These are four quality teams and they are very familiar with the contract."