Justice will proceed with disputed computer ID contract

The Office of Justice Programs is moving forward on a contested contract with LS3 Technologies for digital identity services, while the grant-making agency reevaluates whether the vendor's offer is the best value for taxpayers, office leaders told Nextgov.

The Government Accountability Office, a congressional watchdog agency, ruled Feb. 29 that the Justice Department should replace LS3, unless it can prove the company's proposal is technically superior enough to merit its higher price tag, which has not been disclosed. OJP already had assigned LS3 an $844,122 job as part of the five-year multimillion-dollar contract, OJP officials said.

The blanket purchase agreement consists of multiple software and service tasks assigned as needed to instate the Federal Identity, Credential and Access Management program, a governmentwide strategy for securing the login credentials and smart card IDs of federal employees.

"We're going to continue with the contract now, because we don't want to fall behind," Phil Merkle, director of OJP's Office of Administration, said this week. At OJP, which funds state and local law enforcement initiatives, LS3 currently is working on technology for logging in OJP employees, and plans to focus on grant applicants and recipients later.

While LS3 progresses on the installation, a government technical evaluation team is reassessing whether the company's offer is worth more money than that of a lower-bidding competitor, NikSoft. After Justice handed the contract to LS3 in October 2011, NikSoft filed a protest with GAO on the grounds that the award did not reflect cost or its own stellar record of work performance, NikSoft's attorneys said.

The OJP team is expected to complete a review by the end of March, OJP officials said. The office will then have enough evidence to know whether to retain LS3's services, switch to NikSoft or, if neither is the best value, reopen the bidding. Conducting another search could push back the schedule by three to six months, officials said. Justice has 60 days to inform GAO attorneys of its intentions.

Both companies are small businesses that have previously provided Justice with ID services. Excluding cost, the top factors that Justice weighed in making a decision were, in order of importance, corporate experience and past performance, according to the department's work solicitation.

OJP controls about $10 billion in grants for programs and research nationwide to prevent youth violence, treat substance abuse and support diverse crime-fighting activities. The ID project entails restricting computer access only to personnel who use electronic ID cards. Since 2004 federal agencies have been required by a presidential directive to use smart card credentials embedded with digital fingerprints and photos for logging into government networks. But the technology in the cards has largely remained dormant because most agencies have yet to install card readers.

As part of the reevaluation, Justice is studying the candidates' track records again "to make sure it's clear what trade-offs there are if any," said Nichelle Robinson, deputy director of OJP's Office of Administration. "If that determination should result in a decision that LS3's quote is not found to be the best value, then we will terminate the BPA at that time."

"We're going to take a step back" to check the decision-making process, echoed Angel Santa, OJP deputy chief information officer.

According to a redacted version of GAO's ruling released Friday, NikSoft's three requisite past performance recommendations received nearly perfect scores, while LS3 provided only two references. Justice argued that NikSoft's submissions came from co-contractors. GAO noted the solicitation explicitly allowed for contractor-written submissions.

GAO also questioned the "exceptional" corporate experience grade that LS3 received. A consensus report named the exact same strengths in LS3's and NikSoft's proposals -- each firm had provided ID management services for more than three years. Plus, NikSoft had an additional advantage, according to the report: "demonstrated capabilities to accomplish a smooth transition, with a superior solution while maintaining sufficient resources showing corporate dedication for meeting program objectives."

But NikSoft earned a lesser "acceptable" rating, GAO attorneys noted. Justice officials explained the discrepancy was due to the fact that the ratings were not based on the consensus report, but rather individual comments from each evaluator.

"This is a fair and open competition," Justice spokeswoman Sabra Horne said. "All vendors are equal in our eyes. It is all down to the proposals and that's what we will take into consideration. That is what we've done in that past and that is what we will do going forward."

NikSoft's attorneys have said Justice should not delay in following GAO's decision and should cancel LS3's award and task order. LS3 officials have not commented on the ruling.