GAO upholds cancellation of $2.6B Northrop DHS campus contract

The Government Accountability Office denies a protest from Northrop Grumman of what the company believed was an "unreasonable" termination of its contract.

The Government Accountability Office has upheld the cancellation of a $2.6 billion contract awarded to Northrop Grumman Information Technology Inc. for IT infrastructure at the new Homeland Security Department headquarters complex in Washington, D.C.

The GAO’s decision allows the General Services Administration to continue soliciting bids and awarding a new contract, which is expected in June.

In September 2010, GSA awarded the 10-year task order to Northrop Grumman. But after other vendors filed bid protests, the agency canceled the contract and issued another solicitation, saying it hoped for a clean slate to deal with the fairness issues raised in the bid protests.

Under the contract, a vendor will develop an integrated system of IT, telecommunications, physical security and building management systems for the complex.

Northrop Grumman then filed a bid protest with the GAO against the cancellation. The GAO issued its decision March 1.

“Northrop maintains that the agency's proposed corrective action is unreasonable. We deny the protest,” the GAO stated in a summary posted on its website.

“Northrop Grumman is disappointed with the outcome of the GAO’s review,” Christine Whitman, a spokeswoman for Northrop Grumman, said today. “ We will evaluate the decision and consider how best to proceed to address the Department of Homeland Security's pressing requirements.”

The GSA, which is helping DHS with the headquarters project, previously had described the construction as the most complex in its history and the largest in the Washington area since the construction of the Pentagon. The consolidation of 22 DHS agencies at the St. Elizabeth’s campus will occur during the next 10 years.