"Controversy surrounds DHS' Unisys airport contract"

Monday, March 12, 2007

Pointing talk
By Alice Lipowicz
Washington Technology

  
A year after a federal audit criticized Unisys Corp.'s performance on a
Homeland Security Department information technology systems contract at
major airports, company officials say they hastened the speed of work in
2006 and have finished the bulk of the job. 

Even so, DHS' Transportation Security Administration has brought in another
IT services provider, Telkonet Inc. of Germantown, Md., to extend and
backfill IT networking and connectivity projects at airports. And questions
about the original Unisys contract linger. 

In February 2006, DHS' inspector general recommended rebidding the $1
billion Unisys contract to connect TSA IT networks at hundreds of airports.
Instead, the department defended the project and its award of an additional
$750 million bridge contract to Unisys to continue the work. 

Although the Unisys deal is on the House Oversight and Government Reform
Committee Chairman Rep. Henry Waxman's database of questionable federal
contracts, suggesting possible abuse and mismanagement, it may instead be an
example of the difficulties in pinpointing responsibility for a possibly
wasteful government contract. 

A critical audit does not necessarily mean poor performance on the
contractor's part or the need for action by Congress, added Stephen Ryan, a
partner in government and regulations at Manatt Phelps and Phillips. If the
original scope of the work expanded and specifications changed midway, as
TSA and Unisys contend, it may be difficult to prove that there was any
overbilling, he said. 

Unisys and TSA have defended the original contract and bridge. "Unisys is
proud of the work and accomplishments we have performed for TSA, and TSA has
given us consistently high marks for performance. TSA has said publicly that
the issues raised in the inspector general's report had been addressed and
that they consider the matter closed," said Lisa Meyer, a Unisys
spokeswoman. 

The project started in 2002, shortly after the 2001 terrorist attacks, when
TSA started to deploy significant security measures at airports. The agency
awarded a $1 billion contract to Unisys, based in Blue Bell, Pa., to provide
network connectivity at 429 airports, along with related IT services and
support. 

According to the IG's report, while TSA initially expected the work to
extend through 2009, Unisys had spent the bulk of the funding, $834 million,
by the end of fiscal 2005. 

"By the beginning of fiscal year 2006, TSA spent most of the contract
ceiling without receiving many of the contract deliverables critical to
airport security and communications," the IG said. "The original funding is
almost exhausted but many airports still do not have basic information
technology and a telecommunications infrastructure." 

TSA officials said they estimated the total costs would be from $3 billion
to $5 billion, and they explained that the $1 billion contract amount was
based on specific initial requirements. 

Nonetheless, TSA awarded the $750 million bridge contract in December 2005
to Unisys to retain equipment leased under the current contract and allow
for a transition to ongoing projects. 

After the bridge contract's award, Unisys proceeded quickly to finish
providing network connectivity to all 429 airports by Sept. 30, 2006, said
Ed Vaccaro, partner in the homeland security practice at Unisys Federal
Systems. 

"There was a big push that occurred in the winter and summer of 2006,"
Vaccaro said. "Unisys did nearly 100 airports in 2006." 

Telkonet offers wireless connectivity through electrical power lines. TSA
brought the company in to provide additional networking services to
airports. 

Initially, Telkonet is installing its solution at Baltimore-Washington
International Airport and Dallas Love Field Airport. At an estimated cost of
about $50,000 per airport, the contract could grow into the multiple
millions of dollars, said Ron Pickett, chief executive officer of Telkonet. 

"The first airports we are installing are intended to demonstrate the power
line solution," Pickett said. "The goal is to put high-speed connectivity to
all the offices and checkpoints."

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