DHS Awards $450M, Pared-down TASC Contract

Lawmakers who had urged the White House to cancel a potentially $1 billion Homeland Security Department computer project are welcoming the Obama administration's recent decision to pursue a less costly, piecemeal approach to developing the financial system.

DHS confirmed on Tuesday that officials have awarded a $450 million contract to CACI Inc.-Federal for the Transformation and Systems Consolidation (TASC) project, which will consolidate financial management networks at component agencies. In June, the Office of Management and Budget directed all departments to halt development on financial systems - a traditionally costly and complex class of projects that are prone to failure. OMB told chief information officers to downsize all system designs to prevent future problems.

In September, Rep. Bennie G. Thompson, D-Miss., chairman of the House Homeland Security Committee, and Rep. Christopher Carney, D-Pa., chairman of the subcommittee on management, investigation and oversight, bypassed department heads and appealed to White House officials to kill the project because its largesse violated OMB's policy.

On Tuesday, Thompson said in a statement that his committee's oversight "has resulted in the department's implementation of new layers of internal control that did not previously exist and has adjusted its initial plan to require more internal and congressional oversight."

Carney added, ""While I am in favor of the Department of Homeland Security consolidating its myriad financial management systems into one integrated system, I am deeply troubled over the cost. . . . I am pleased that the Office of Management and Budget (OMB) directed the department to phase-in TASC implementation until there is a better strategy in place."

Breaking projects into chunks that bring key functions online more quickly -- a common private sector practice -- is part of a broader IT reform strategy that OMB officials announced last week.

DHS officials on Tuesday said the five-year CACI contract, which was awarded on Friday, is capped at $450 million, including five one-year options. To comply with OMB's orders, the department is dividing the contract into small task orders that are easier to oversee. DHS will begin integrating systems only at the Federal Emergency Management Agency to learn what management techniques work best before tying in other agency networks.

"The TASC solution will first be delivered to FEMA. Pending successful migration and approval from our financial services advisory board, the solution will then be delivered to additional components with an identified critical business need," DHS spokesman Larry Orluskie said.

OMB officials on Tuesday said the project that DHS initially had in mind was overly broad and carried unacceptable risks of cost-overruns.

"OMB and DHS worked together to shrink it down to the most mission critical element," OMB spokeswoman Moira Mack said. "Only after that first critical element proves successful will the administration consider investing additional resources in this project."