Bids invited again for cancelled $1.4bn US Treasury contract

One of the biggest telecomms tenders ever has been sent back to the drawing board

The US Department of the Treasury is re-opening bidding for a US$1 billion (NZ$1.4 billion) communications contract that was originally awarded to AT&T late last year. The deal was cancelled in May after competitors protested (in March) that the bidding process was unfair.

The agency has made the latest move after an unsuccessful effort to find a contractor through the general services administration (GSA).

The three-year Treasury Communica­tions Enterprise contract, which includes seven one-year options, seeks a vendor to supply telecommunications services and support for more than 1,000 domestic locations and tens of thousands of users in the US and overseas.

The contract, initially won by AT&T in December, was cancelled after protests were reviewed and upheld by the US government accountability office (GAO). Objections came from Broadwing Communications , Level 3 Communications, MCI, Northrup Grumman Information Technology and Qwest Government Services. A sixth bidder, Sprint, didn’t contest the contract.

In its decision, the government accountability office said the Treasury Department had not had discussions with all the bidders and ordered the department to do so before re-awarding the contract.

After cancelling its deal with AT&T, the Treasury department said it would use the existing GSA programmes and contractors for the work.

However, in a recent statement, a Treasury department spokeswoman said the department is moving forward with its own procurement effort because an evaluation found that no existing GSA contract could meet its communications needs.

The Treasury department also said it will implement the GAO’s recommendation to renegotiate with the other bidders and will give the vendors that had previously submitted proposals an opportunity to submit revised bids.

The contract, known as the TCE (Treasury Communications Enterprise) contract, will provide telecomms services and support to more than 1000 locations, covering the US internal revenue service, the US mint and comptroller of the currency, among other Treasury branches.

AT&T had planned to build a secure high speed IP VPN and in its original bid, it partnered with Accenture, BAE Systems and Lucent Technologies.

The company intends to re-bid for the contract, AT&T government solutions president Lou Addeo says.

In a statement, Addeo said: “We’re disappointed in the GAO’s decision, but we fully intend to compete vigorously to retain this award as the Treasury Department amends it and collects additional information from bidders.

“We strongly believe we submitted far and away a superior solution to Treasury’s networking needs and we look forward to making our case again to Treasury,” he said.

MCI spokesman Jerry Edgerton says the company, one of the five which objected, will “definitely” be bidding for the new contract.

Additional reporting by Carolyn Duffy Marsan

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