Testimony: DHS acquisition skirts oversight

Two of the largest contracts of the Homeland Security Department have avoided scrutiny to date from the department's central procurement offices, according to a senior Government Accountability Office official.

John P. Hutton, director of acquisition and sourcing management at GAO, testified to a Senate subcommittee about key acquisition concerns at the department. One key concern is that Coast Guard acquisitions, including the $24 billion Integrated Deepwater Systems program, are exempt from Central Procurement Office oversight.

Another key concern is that Customs and Border Protection's estimated $8 billion Secure Border Initiative Network was rushed into operation without input from the department's investment review board or joint requirements council, he testified.

The Deepwater program, which has experienced cost overruns and delays since it was initiated in 2002, has not been effectively managed by the Coast Guard, Hutton said. To increase central oversight of Deepwater and other programs, the department is working to bring the Coast Guard and Secret Service under an October 2004 management directive on DHS acquisitions, from which those two components are currently exempt, he said.

SBI-Net, which is the border surveillance system program awarded to Boeing Co. of Chicago in September 2006, bypassed the department's investment review board and requirements council in its rush to meet an aggressive schedule, Hutton said. Steps are now being taken to conduct those reviews, he added.

Overall, DHS contracted for nearly $16 billion in fiscal 2006, but its procurement functions still are not sufficiently integrated and the department continues to face challenges in performing effective oversight, Hutton testified to the Senate Subcommittee on Oversight Management, Federal Workforce and the District of Columbia on June 7.

"DHS has recognized the need to improve acquisition outcomes and taken some positive steps, but continues to lack clear accountability for the outcomes of acquisition dollars spent," Hutton said.

The GAO worries that the department's Central Procurement Office does not have sufficient authority to oversee major procurements throughout the department. The central office received funding to add 25 staff members in fiscal 2006, and expects to add three more staff members in 2008, GAO said.

Areas of concern in procurement at DHS include about $6.5 billion annually in interagency contracts, use of systems integrators and use of contractors for services that closely support inherently governmental functions, Hutton said.