Davis may cut off funds for Treasury's TCE deal

House Government Reform Committee chairman Tom Davis (R-Va.) may try to cut funding next year for the Treasury Department's controversial next-generation network and telecommunications contract.

Treasury decided to award the $1 billion, 10-year Treasury Communications Enterprise departmentwide contract instead of opting to wait for the governmentwide Networx contract to become available. Bidders last year successfully protested the original TCE award to AT&T Corp. Treasury is expected to re-award the contract in the spring.

"We may make an effort next year to cut finding for that entirely," Davis said yesterday at the Consumer Electronics Show in Las Vegas.

Davis has long supported the Networx contract and has been a harsh critic of Treasury for going it alone. The General Services Administration should be the agent to manage the government's telecommunications acquisition infrastructure, the congressman said.

"We'll continue to, I will just say, vigorously oversee that program [TCE], and the final chapter is not written," he added.

Treasury CIO Ira Hobbs said he had no comment in response.

It's no secret that Davis does not support agencies erecting stovepipe infrastructures, said Drew Crockett, a spokesman for the House Government Reform Committee.

"Working with appropriators to cut TCE's funding is an option that the chairman is more than willing to pursue," he said.

TCE fosters the perpetuation or creation of duplicative administrative procurement functions across government, which is far more costly and far less efficient than centrally managed core infrastructure procurements, Crockett added.

Davis has also requested documents from Treasury relating to its need to go forward with TCE, along with cost figures and other technical information.

Last month, Treasury said it extended by two years its current contract with incumbent Northrop Grumman Corp. while it considers bidders' proposals in a recompete of TCE. Northrop Grumman was awarded the Treasury Communications Services contract in 1995. That contract will not expire now until September 2007.

AT&T won the initial award in December 2004 to provide Treasury with next-generation data, video and voice communications connected into a single network infrastructure. Currently, Treasury has multiple bureaus with independent networks connected through a distributed hub-and-spoke architecture.

The recompete is the result of an award protest that the Government Accountability Office upheld. The protest was based on the fact that Treasury did not inform bidders of an agreement that would impact the contract.

Unknown to the bidders at the time, Treasury had signed an agreement with GSA and the Office of Management and Budget to pave the way for a move when TCE's base period expired to Networx when it became available. That agreement was voided in August when Treasury decided, as GAO recommended, to reopen the bidding with the original vendors.

OMB made it clear during the original contracting process that it would steer agencies toward Networx instead of letting them strike their own deals to overhaul their networks.

Following GAO's ruling for the bidders in March, Treasury said it was going to use a GSA FTS 2001 telecommunications service provider and then move to Networx, but backpedaled in August, saying that the existing governmentwide contract did not meet its needs and that it would reopen the contract.

Besides AT&T and Northrop Grumman, the vendors that previously submitted proposals and may do so for the recompete are Broadwing Communications LLC, Level-3 Communications Inc., MCI Communications Corp., Qwest Communications International Inc. and Sprint Corp.

Mary Mosquera is a staff writer for and Brad Grimes is the chief technology editor of Washington Technology's sister publication, Government Computer News.

About the Authors

Mary Mosquera is a reporter for Federal Computer Week.

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