Protest of TCE award upheld by GAO

The Government Accountability Office has sustained protests filed by five companies last December against the Treasury Department's award of the $1 billion Treasury Communications Enterprise contract to AT&T Corp.

"GAO sustained all the protests," said Dan Gordon, GAO's associate general counsel and head of the bid protest unit. He would not comment beyond that.

"We're reviewing the decision and assessing our options," a Treasury Department spokeswoman said.

Under the Treasury Communications Enterprise awarded to AT&T by the IRS Dec. 6, Treasury was to build a next-generation enterprise network serving tens of thousands of users. Northrop Grumman Corp.'s 10-year contract expires in September.

Northrop Grumman, Qwest Communications International Inc. of Denver, Broadwing Communications LLC of Columbia, Md., Level-3 Communications Inc. of Broomfield, Colo., and MCI Inc. of Ashburn, Va., filed bid protests with GAO following the awarding of the contract. Sprint Corp. of Kansas City did not file a protest.

Following GAO's decision, Qwest issued a statement saying that is was gratified with GAO upholding its protest and looked forward to continuing to work with the Treasury Department in developing its communications infrastructure.

"Our faith in the fairness of the federal procurement process is affirmed by this decision," said Jerry Hogge, senior vice president of government markets at Level 3 Communications Inc.

AT&T officials expressed disappointment in the ruling.

"We fully intend to compete vigorously to retain this award as the Treasury Department amends it and collects additional information from bidders," said Lou Addeo, president of AT&T Government Solutions, in a printed statement. "We strongly believe we submitted, far and away, a superior solution to Treasury's networking needs, and we look forward to making our case again to Treasury."

The indefinite-delivery, indefinite-quantity contract is for three years and valued at $381 million, with seven one-year options. AT&T will provide a single, departmentwide area network including technology, support and management for Treasury's 850 locations.

AT&T said it will build a secure, high-speed virtual private network designed to handle Treasury's voice, video and data traffic. Treasury employees will be able to communicate with any location or data center over a common, low-cost network that will accommodate future requirements, such as voice over IP and real-time video services.

With a common Web interface, Treasury users will have access to online ordering, billing, help-desk support and network performance information to manage the network.

Posted March 17 at 5:03 p.m.; updated March 18 at 3:50 p.m.