April 13, 2018 —
We determined whether the Defense Information Technology Contracting Organization (DITCO) Europe within the Defense Information Systems Agency (DISA) properly awarded telecommunication service contracts. We reviewed 30 contracts, valued at $64.5 million, awarded from October 1, 2014, through May 31, 2017.
The United States Court of Federal Claims referred information to the DoD Office of Inspector General on one DISA telecommunication service contract that we included in our sample, and the specific details of the request and our review of that contract are included in Appendix B.
We focused our audit on contracts awarded by DITCO Europe to address follow up questions identified by the United States Court of Federal Claims related to a contract the court referred for our review. The Court found that DITCO Europe did not exercise due diligence when awarding the contract and requested that we review why the contracting officer awarded the contract at a price of $38.6 million more than the lowest priced but unsuccessful offeror. We reviewed an additional 29 telecommunication service contracts awarded by DITCO Europe to determine whether similar problems existed with the award process.
DISA is responsible for purchasing telecommunication services for the DoD. DITCO, a component of DISA, provides the contracting support to acquire telecommunications services. These services are obtained under communication service authorizations, which are contracts used solely for the acquisition of telecommunication services.
We determined that DITCO Europe contracting personnel properly awarded 30 telecommunication service contracts, valued at $64.5 million. We considered the contract awards proper if there was adequate evidence to support that DITCO Europe contracting personnel ensured acquisition planning, competition, and execution of the designated acquisition strategy were in accordance with the Federal Acquisition Regulation (FAR). However, DITCO Europe contracting personnel did not consistently apply FAR requirements for market research, contract file documentation and source selection. Specifically, DITCO Europe contracting personnel:
- Did not adequately conduct or document market research in accordance with the FAR for 18 of 24 contracts. This occurred because DITCO Europe contracting personnel used their comprehensive knowledge and ongoing associations with the telecommunication providers in Europe to identify potential contractors.
- Did not ensure contact files contained the required documentation to constitute a complete history of the transaction in accordance with the FAR for 16 of the 30 contracts. This occurred because the Integrated Defense Enterprise Acquisition System (IDEAS) builds and maintains the contract files; however, IDEAS uploads files as text files and does not always include the same level of detail as other available documentation that could be manually uploaded. Additionally, DITCO Europe contracting personnel experience latency problems when uploading files to IDEAS, and in some cases the files failed to upload.
- Did not ensure telecommunication providers provided evidence of National Long Lines Agency (NALLA) accreditation as required in the solicitation, thereby violating the FAR for 11 of 19 contracts. This occurred because DITCO Europe contracting personnel made it standard practice to perform the NALLA accreditation check themselves on behalf of the contractors.
As a result, DITCO Europe contracting personnel cannot support that they conducted market research before soliciting offers and could not demonstrate that all contract requirements and decisions were fully supported throughout the contract file. Additionally, while the deficiencies did not affect award decisions, not following the requirements of the FAR pertaining to the award of telecommunication service contracts and not enforcing NALLA accreditation may increase the risk of award protests and litigation.
During the audit, DITCO updated its procedures to address our concerns regarding the verification of NALLA accreditation, and no recommendation was necessary.
We recommend that the Director, DISA, in coordination with the Director, Procurement Services Directorate, DITCO, provide refresher training to contracting personnel on conducting market research and fully documenting contract files in accordance with the FAR.
Management Comments and Our Response:
The DITCO Procurement Services Directorate Director, responding on behalf of the DISA Director, agreed with our recommendation to provide refresher training to contracting personnel related to FAR requirements for market research and maintaining contract files. The Director stated that DITCO Europe developed market research templates to upload into the contract files before solicitation effective February 1, 2018, and instructed all team members on January 23, 2018, to incorporate the market research reports into IDEAS. The Director also stated that the Procurement Services Directorate will work with the IDEAS Change Advisory Board to ensure files uploaded to IDEAS capture necessary information, and planned to have this effort completed in the third quarter FY 2018. Lastly, the Director stated that contracting support staff received training in January 2018 to file contract documentation in the IDEAS official contract files. Therefore, the recommendation is resolved but will remain open. We will close this recommendation once we receive evidence of the newly developed market research template and instruction to use the reports, implementation of the solution to ensure IDEAS files capture necessary information, and the training provided to staff to file required documentation in the official contract files.