Issa Ponders Legislation to Speed Networx Transition

Ranking Member Darrell Issa, R-Calif., hinted at legislation to spur agencies to complete the transition, possibly by requiring that they switch immediately to Networx. He asked witnesses why “this committee should not look toward moving all of government to a less expensive, more competitive solution through interim legislation.” That would discourage agencies from maintaining FTS2001 networks until the deadline, he said. Chairman Ed Towns, D-N.Y., didn’t specifically mention legislation but pressed witnesses for suggestions on how the committee could help: “What are the key things we can do right now, today, tomorrow to speed this transition?"

Issa also suggested doing away with the long bidding process involved in securing contracts. Contracts have “enjoyed protests after GSA has done the primary bidding in the process,” he said. Issa asked if vendors would back a process “more like a buffet,” whereby agencies “would be able to make the decision among you as vendors with a price structure in place and effectively not have to move through the level of bidding that they're going through."

Committee intervention seems possible, Senior Vice President Diana Gowen of Qwest Government Services told us after the hearing. Near term, the committee probably will bring the GSA and others back for another status update, she said. Long term, legislators may consider overhauling procurement, she said. Gowen said it sounded as if Issa may want to mandate the transition to Networx but she would need to see his question in writing to be sure.

The committee had concerns about the pace of Networx at a hearing back in 2005, Towns said. “Five years later, ‘concerned’ is an understatement. If there’s a red flag that’s yet to be thrown, I'm throwing it.” Networx is supposed to save the government money, and it gives up about $22.4 million in savings every month the transition is delayed, he said, citing GSA figures. Taxpayers may have lost $300 million to $500 million by next year, he said.

The government also is losing opportunities created by replacing old technology, said Issa. “The taxpayers expect the government to be different than the private sector, but they don’t expect the government to ignore the taxpayers’ dollars, as though they're not accountable to anyone.” Issa said he doesn’t blame the Obama or the Bush administration for the delay. It’s “yet another example where bureaucrats unseen and seldom known by name do not care enough about the taxpayers’ money enough to save it,” he said.

The GSA is upbeat about finishing the transition, which is 53 percent complete, said Stephen Kempf, acting commissioner of the agency’s Federal Acquisition Service. “Agencies are now highly engaged and are doing everything possible to meet transition schedule deadlines,” he said. “Transition is well under way and will be completed.” The GSA is helping agencies accelerate their transitions, Kempf said. “During the past year, GSA has offered to provide any assistance to any agency” to help complete the transition. The GSA is handling transition work itself for smaller agencies, he said.

The GSA won’t allow FTS2001 services remaining after the transition deadline to be cut off, said Kempf. Before they expire, the agency will negotiate bridge contracts to allow continued service, he said. “We can’t afford to have the lines drop dead in June 2011."

Government officials blamed the delay on the Networx program’s complexity and on insufficient agency resources. The contracts “contain a broad range of services and price items which require technical knowledge of network services,” said Kempf. And many agencies lack staff with adequate technical expertise, he said. Agencies have ordered more work specific to them than expected, creating more work for the agencies, and sufficient inventory data hasn’t always been available right away, he said. Some agencies have had difficulty entering orders into contractors’ online ordering systems, he added.

A Networx contract contains six times the number of line items of a FTS2001 contract, said Sanjeev Bhagowalia, the U.S. Interior Department’s chief information officer. And agencies face many competing priorities, slowing progress, he said. Recent efforts by the GSA, the OMB and agency CIOs has accelerated progress, but the swell of agency procurements swamps vendors’ ability to respond, he said.

Continued oversight by the committee and the OMB will help keep everyone focused on completing the transition, said Bhagowalia. To further expedite the transition, agencies should adopt a “like for like” approach that focuses on moving current services to the new contract, he said. Agencies should verify their inventory of FTS2001 services and dedicate staff to the transition, he said. And vendors should adhere to the time set for proposal development, he said.

Agencies should “allocate greater resources to the effort” and “take advantage of incentives” offered by the GSA and the Interagency Management Council, said President Susan Zeleniak of the Verizon Federal Group. Additional discussion between agencies and industry would make the process faster, Qwest’s Gowen said in her testimony. Agencies, the GSA and vendors “should coordinate to provide and adhere to specific, disclosed and harmonized timetables for releases of requests for proposal and subsequent awards,” agreed Donald Herring, AT&T Government senior vice president.

Sprint and Level 3 officials suggested combining the two types of contracts under Networx --Enterprise and Universal. The companies are eligible to offer only Enterprise contracts. The contracts overlap in services, and Enterprise has lower prices because it’s more competitive, said Bill White, federal programs vice president of Sprint. But officials from Qwest, Verizon and AT&T, which provide service under both contracts, dismissed the idea. Having two contracts hasn’t caused a delay, and trying to combine them would distract from the transition, said Herring. Universal contracts offer 29 services, whereas Enterprise only provides 13, said Zeleniak. And unlike Enterprise, Universal was built for “continuity of operations,” said Gowen.

Towns complained that the Office of Management & Budget wasn’t represented at the hearing. “OMB’s absence is unfortunate, because I think OMB’s leadership will be a key factor in expediting the transition to Networx.”