Inside DHS' Classified Cyber-Coordination Headquarters

The Department of Homeland Security (DHS) has scrapped a project to modernize its financial management systems through an enterprise-wide consolidation after a government watchdog agency upheld a protest over the terms of its solicitation, according to a department official.

In March, the Government Accountability Office (GAO) sustained a protest from Global Computer Enterprises about a $450 million award the DHS made for its Transformation and Systems Consolidation (TASC) project, which was meant to deploy a modern enterprise resource planning system.

The company protested the award given to Arlington, Va.-based contractor CACI last November because the DHS did not revise a solicitation for the project after the department changed its scope at the request of the Office of Management and Budget (OMB) last year.

As a result, the DHS won't go ahead with the project as originally conceived and instead is eyeing other options to modernize its financial-management system, including ones that utilize cloud-based options, said department spokesman Chris Ortman.

"Based upon a review and reevaluation of the solicitation, DHS is considering alternatives to meet revised requirements," he said in an email to InformationWeek, adding that a "modernization of the department's financial, acquisition, and asset systems remains a key priority."

Like other federal financial-management projects, TASC was held up last summer pending review by the OMB, which called for all such projects with a price tag of $20 million or more to be put on hold pending review and an agency re-evaluation.

The DHS said it would go ahead with the project anyway. The GAO already had criticized the department for making slow progress on TASC in a December 2009 report.

The DHS worked with the OMB to narrow the scope of the project and make changes that were "materially different from the assumptions set forth" in the original solicitation, according to the protest from Global Computer Enterprises. This formed the basis for the protest that the GAO upheld, even while the agency dismissed a related one lodged by Savantage Financial Services.

After the GAO's ruling, the DHS revised its requirements for TASC, changing them in several areas--including data-center hosting, which paves the way for a cloud-based solution rather than one hosted in a DHS data center.

Rather than an enterprise-wide modernization effort that will take five to 10 years to complete, the DHS also now is considering making changes to the financial-management systems of only the most critical organizations within the department, it said. They include the Federal Emergency Management Administration (FEMA), the U.S. Coast Guard and Immigration and Customs Enforcement, according to the DHS.

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