Feds canceled a $2.6 billion deal with Northrop Grumman for the project in 2010.
The General Services Administration awarded General Dynamics a roughly $1 billion networking contract for a new Homeland Security Department headquarters facility, after the government backed out of a $2.6 billion deal with Northrop Grumman Corp. for the project last year.
Officials at GSA, which is administering the contract on behalf of Homeland Security, said Monday that the cost difference resulted from more tailored bids this time around as well as a shorter time span for the work. GSA canceled the Northrop Grumman agreement and reopened the competition earlier this year after several vendors, including General Dynamics, protested that the requirements for operations and maintenance listed in the work solicitation were too vague. Without sufficient details, only one of the five initial bidders -- Northrop Grumman -- submitted a proposal that met DHS' needs, according to a review by the Government Accountability Office.
Under the new pact, General Dynamics will deploy an information technology system for transmitting voice, video and data across the new facility on the St. Elizabeths Hospital campus in Southeast Washington. The seven-year contract period covers design, procurement, configuration, installation, testing, security and maintenance at the location, which will house the department's currently scattered agencies.
The so-called Technology Integration Program is capped at $876 million, according to GSA officials.
The original award to Northrop Grumman announced in September 2010 would have spanned a decade, if all options for maintenance were exercised, GSA spokeswoman Cara Battaglini said. "The scope of DHS TIP has minimal operations and maintenance support," she said. "This difference accounts for the majority of the reduced award amount."
In addition, the revised solicitation issued earlier this year clearly delineated staffing expectations for the desired operations and maintenance. "Additional details in the performance work statement helped the bidders improve their proposals, improving quality and lowering the cost to the taxpayer," Battaglini said.
Officials at the company based in Falls Church, Va., said General Dynamics has a proven track record of offering the government large-scale IT services, noting four major defense and intelligence projects under way. The company currently is involved in a 10-year renovation program at the Pentagon and is supporting the transition of Walter Reed Army Medical Center services in Washington to Bethesda, Md., and Fort Belvoir, Va.
"Within DHS, we've been doing IT and operations and maintenance support for U.S. Citizenship and Immigration Services, DHS headquarters and the Coast Guard," General Dynamics IT spokesman Mark Meudt said. "We're very, very pleased that DHS selected us for this award. We believe our past performance and expertise fits very well with what DHS is looking for."
Northrop Grumman spokesman Mark Root said the company "offered the Department of Homeland Security an outstanding technical solution and we are disappointed in the GSA's decision."
"We look forward to continued support and success with the DHS on other information technology and security programs of critical importance to information exchange and national security," Root said in a statement.
GSA Administrator Martha N. Johnson said in a statement, "All of GSA is partnering with DHS to create a model campus that is green, energy efficient, and secure, with an integrated technology backbone that can accommodate IT, physical security and smart building networks for the agency well into the future."
DHS Chief Information Officer Richard Spires added, "The work accomplished through the DHS TIP is critical to the success of the Department of Homeland Security and our consolidation efforts."
In the original version of this story, GSA officials misstated the cap on the Technology Integration Program. The story has been corrected.
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