Flood of Bids is Behind Delay at GSA

By Arshad Mohammed
Washington Post Staff Writer
Thursday, January 26, 2006

The General Services Administration said yesterday that it got more bids than expected for a $20 billion telecommunications contract known as Networx, forcing the agency to delay the award so it can evaluate the complex proposals.

"The good news is that we have a tremendous amount of interest in the program. The bad news is that we have a lot of work to do," said John C. Johnson, who is overseeing the program for the GSA.

The 10-year telecom contract, the largest ever to be awarded by the GSA, has attracted bids from companies including AT&T Inc., Qwest Communications International Inc., Sprint Nextel Corp. and Verizon Communications Inc.

The contract is split into two parts: Networx Universal, which requires bidders to show they can provide a vast array of services around the globe, and Networx Enterprise, which has narrower requirements to allow smaller firms to get a piece of the action.

Contract awards had been due this year, but the GSA said Monday that bids would be delayed until next year without giving a reason.

Johnson, who said he was barred by federal procurement regulations from disclosing the number or names of bidders, said more companies had showed interest in the overall project than he expected and the bids covered "the whole spectrum" in terms of their quality.

"The level of interest was higher than expected, and these are large -- very large -- contracts, very complex, and the quality of the offers varies," he said. "Taking those things into account, we believe that it's going to take us longer to evaluate and ultimately make the awards."

Johnson said the GSA does not need more resources to handle the bids.

Federal contracting experts said delays of large federal contracts were not unusual, particularly those with complex technical requirements such as Networx. They also said there is often a lengthy back-and-forth with bidders to clarify their proposals.

Rep. Thomas M. Davis III (R-Va.), chairman of the House Committee on Government Reform, which has federal procurement oversight, said he was not too troubled by the delay.

"While I am certainly a bit disappointed in this latest delay and feel it's taking longer than it should, it is more important for GSA to do this right than to do it on schedule," Davis said in a written statement.

"Most of us expected there might be some delay. I think we were all surprised at the length of the delay," said Tony D'Agata, a vice president for federal government business at Sprint Nextel.

The GSA's Johnson said his agency planned to extend the current federal telecom contract -- FTS 2001 -- with the two incumbent providers, Sprint Nextel and Verizon.

D'Agata said the GSA had proposed prolonging Sprint Nextel's contract, which expires in December, for two years with the option for three further six-month extensions. He said the extra time might be needed to migrate federal agencies from the current contract to Networx.

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