U.S. Border Security at a Crossroads

Datatrac declined to discuss details of its contract.

Rogers declined to be interviewed for this article. He said in a prepared statement: "While the long-term future of the cards is unknown, they currently provide a vital security service along our borders."

'Industry Day'

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Datatrac was one of dozens of companies seeking homeland security work on the borders. In 2003, it was part of the Accenture team seeking the contract to create the US-VISIT system.

Homeland security officials running that competition declared their intentions to rely heavily on the private sector. Speaking at a US-VISIT "Industry Day" in July 2003, they called on scores of corporate representatives gathered in suburban Virginia to form teams to address the government's ambitious goals.

US-VISIT officials told the companies they would welcome "direct and candid" comments in the coming months before the formal requests for bids were scheduled to be issued, according to documents that US-VISIT distributed at the session. Those comments could include recommendations for constructing the bid request itself, the document said. The winner would be a government "partner," and together the government and contractor would have shared accountability.

Within weeks, three bidding teams emerged: Computer Sciences Corp., Lockheed Martin Corp. and Accenture. Each had more than a dozen potential subcontractors. The US-VISIT team maintained contact with all three teams over the next few months. But it was Accenture that captured the attention of US-VISIT program director Williams, according to documents and interviews with people involved in the process.

Accenture had once been associated with the now-defunct Arthur Andersen LLP accounting firm. The company, then operating as Andersen Consulting, blossomed during the high-tech boom of the late 1990s, in part by offering governments and businesses solutions to their technology problems.

In 2001, the company renamed itself Accenture. It employed 75,000 people in 47 countries and had revenue of more than $11 billion. Based in Hamilton, Bermuda, the company called itself a "global management consulting, technology services and outsourcing company."

Before long, it was also fashioning itself into a homeland security specialist. In its first three years under its new name, Accenture rose to 24th from 59th in the rankings of the government's prime information technology contractors, its contracts surging to $427 million from $81 million, according to Eagle Eye Publishers Inc., a private company that sells data on federal contracts.

In August 2003, at the same time Accenture executives were offering advice to Williams, they were lobbying Rogers, the chairman of the House Appropriations homeland security subcommittee, documents and interviews show. That committee has a strong say over funding for US-VISIT and other homeland security programs.

Accenture, with help from its subcontractor, Datatrac, secured a meeting with Rogers's chief of staff, according to officials at Rogers's office and Accenture. The Accenture officials downplayed the importance and timing of the meeting, saying in an e-mail "that all the bidders were actively lobbying members of Congress on US-VISIT, so our actions were not unique."

Accenture also raised its profile by hiring former government officials who had personal or professional ties to US-VISIT managers. One of the people Accenture hired as a lobbyist and consultant was Steve Kelman. As chief of procurement policy for the Clinton administration, he helped create rules that eased the outsourcing of government work to private companies. Kelman had worked closely on that project with Williams, who was then at the Internal Revenue Service.

In his role as a consultant, Kelman helped Accenture draft a document urging Williams's US-VISIT team to give contractors great latitude in designing the system and to limit the number of bid competitors to "2 or 3" as a way to speed the process of choosing a victor. Kelman said his advice focused on linking the winning bidder's pay to its performance.

Williams, who was one of several officials responsible for awarding the contract, recently said he was unaware of Kelman's role. Kelman said in an interview: "I would have thought [Williams] would have known" about Kelman's involvement.

The lines between the government and Accenture continued to blur. On Nov. 28, 2003, the US-VISIT program requested bids from the three teams. Two months later -- and four months before the contract was awarded -- Accenture's team moved into the 13th-floor of a Rosslyn office building, just below the floors occupied by US-VISIT officials.

"The space came available, and someone on the team saw it and realized this would be convenient space if we eventually won the project," said Taylor, the Accenture spokeswoman.

In February 2004, Accenture's team put on a demonstration for Williams in the suburban Virginia parking lot of another Accenture subcontractor. Accenture set up a make-believe checkpoint to simulate a border-crossing post. Williams was told to drive through to test Accenture's technical savvy. He accelerated to 40 miles per hour and passed through electronic sensors.

As Williams drove past the sensors, playing the role of foreign visitor, the system scanned a chip embedded in a mock passport. Moments later, an electronic sign proclaimed that "James Williams" was the man behind the wheel of the car. The show was a rousing success, Williams said.

But Accenture said that the demonstration had little to do with what will eventually be built.

Peter Soh, another Accenture spokesman, said in an e-mail that the "simulation Accenture staged was for demonstration purposes only. It was not a recommended solution or a technology offering, and in no way did it represent what the final US-VISIT solution will look like."

Accenture's team won the contract in May 2004. Company officials said the division working on US-VISIT is Accenture LLP, based in Northern Virginia.

Williams said Accenture officials are playing an important role in shaping the vision for US-VISIT by helping him and his team understand how to buy and organize such a complex system. He said such a role is increasingly common in federal contracting. Of the three bidders, he said, Accenture was consistently the most helpful and convincing.

"Accenture listened well to the approach the government wanted to take and said: 'You're taking the right approach,' " Williams said.

Oversight From Afar

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In each of the past three years, numerous questions have been raised about US-VISIT's management, oversight and costs.

In 2003, GAO auditors reported that the costs could rise far above the official $7.2 billion estimate -- likely "in the tens of billions." The report concluded that US-VISIT was a financially "very risky endeavor" because there were not enough government officials to properly manage the program.

In 2004, another GAO analysis said the government's US-VISIT team had not moved quickly enough on its earlier findings, chiding the government for failing to correct "fundamental limitations in the program office's ability to manage US-VISIT." That was in part because the US-VISIT office had only about half the 115 employees that officials said were needed to run the project.

In February, another audit reported that the current US-VISIT system has trouble tracking "the entry and exit of persons entering the United States at air, land, and sea ports of entry." The report said the homeland security department "has not employed rigorous, disciplined processes typically associated with successful programs."

Last week, homeland security officials said the fledgling system has blocked the admission of nearly 600 people and led to the arrest of 39.

"US-VISIT works," Williams said. "The results have shown that it works. We are working hard to meet the congressional and presidential mandates to complete the system."

The US-VISIT program now has 100 government employees.The program has turned to contractors for administrative and clerical support -- 94 people from Mitre Corp. and PEC Solutions Inc.

Today, an official responsible for oversight of the US-VISIT contract works out of an office in her home in Bradenton, Fla.

Dana Schmitt is the director of the Office of Acquisition and Program Management for US-VISIT -- which is responsible for "support, oversight, and control" of Accenture and its subcontractors. Schmitt, a former immigration service official who earns $114,344 a year, said she visits the US-VISIT offices in Rosslyn once every six weeks or so.

She and her supervisors said she can capably handle the job from about 950 miles away. But she said that her program management office has only nine of the 40 government employees she deemed necessary.

US-VISIT officials were interested in Schmitt because of her experience working with large technology projects at the immigration service. She agreed to work on US-VISIT, she said in an interview, as long as she could stay in Florida.

She said she has become good at working with contractors and her colleagues from afar, using conference calls and e-mails. She said she has no trouble monitoring the contract and overseeing the work of her colleagues.

"I can actually tell by tone of voice if people are getting agitated," she said. "It's basically an oversight function. . . . Being in Florida doesn't hamper it."

D. Kent Goodger, a veteran contracting officer for several federal agencies who now teaches procurement rules to government officials, said oversight managers need regular, face-to-face interaction to do their jobs.

"I don't see how she can have such a very important, visible role without having daily contact," he said.

Williams, the US-VISIT program director and Schmitt's boss, described her as immensely talented and an important asset to the project. He said he initially had doubts about allowing her to work from Florida.

"I absolutely had those worries," Williams said. "To me, it became kind of an experiment. So far, it is an experiment that's working very well."