Correction to This Article
The article said that Bechtel and Fluor sold trailers to the Federal Emergency Management Agency for Hurricane Katrina. The companies helped haul and install the trailers.
Congress Says DHS Oversaw $15 Billion in Failed Contracts

By Dana Hedgpeth
Washington Post Staff Writer
Wednesday, September 17, 2008

In the five years since it was created, the Department of Homeland Security has overseen roughly $15 billion worth of failed contracts for projects ranging from airport baggage-screening to trailers for Hurricane Katrina evacuees, according to congressional data to be released today.

The contracts wound up over-budget, delayed or canceled after millions of dollars had already been spent, according to figures and documents prepared by the House Committee on Homeland Security. A panel of experts is to testify today before the House Subcommittee on Management, Investigations and Oversight on how to fix problems with the DHS acquisitions process.

The six-member panel includes an acquisition director from the Government Accountability Office, leaders of watchdog groups and the deputy inspector general for DHS.

A spokesman for DHS declined to comment in advance of the hearing.

The experts are to talk about a series of problem projects: About $351 million was wasted and not properly overseen in the U.S. Coast Guard's Deepwater program after ships were built and then scrapped, according to Homeland Security committee staffers and oversight agency reports. A $1.5 billion Boeing program to help secure U.S. borders with electronic sensors and other equipment is being shelved after it was over-budget, late and had technology problems.

A $10 billion program called US VISIT, a computer system designed to record the entry and exit of visitors to the United States at airports and border crossings, is behind schedule and not being managed well, according to figures prepared by the committee staff. And $200 million was mismanaged and poorly spent in buying trailers from Bechtel and Fluor for Hurricane Katrina, according to committee staffers, the GAO and other oversight reports.

"You're talking about a third of the agency's contracting spending that's resulted in failed contracts," said Scott Amey, a lawyer for the Project on Government Oversight who is expected to testify today. "DHS is definitely not the poster child for good contracting or management."

DHS was created by merging 22 agencies, including the Federal Emergency Management Agency, the Immigration and Naturalization Service, the Coast Guard and the Transportation Security Administration. It has more than 200,000 employees and an annual budget of roughly $50 billion. Its contract spending has grown from $3.4 billion a year to $12.2 billion last year.

There are multiple problems, experts said, with the agency's contracting. Like many other federal agencies, DHS has a shortage of qualified acquisition professionals. Stretched too thin, acquisition officials are often asked to manage several large and complex projects at once and don't have time to effectively watch over the contractor's work, industry experts say.

"Agency officials must know where and how the money is being spent," said Rep. Bennie G. Thompson (D-Miss.), who chairs the Homeland Security Committee. "DHS leadership has permitted a system of waste, abuse, mismanagement, vague contractural terms, overspending, bonuses for bad performance, contractors being hired to oversee contractors and the same missteps over and over again."

A DHS official said in written testimony that the agency is adding more acquisition personnel, enacting better policies and procedures, and trying to coordinate how its various divisions buy goods and services.

"The acquisition program must be able to adapt and identify both near- and long-term solutions," Richard K. Gunderson, deputy chief procurement officer for DHS, said in prepared testimony.

View all comments that have been posted about this article.

© 2008 The Washington Post Company