Despite delays, telecom deals please

GSA MAA site

Few agencies are using the new General Services Administration local telephone contracts, but those that have moved over are pleased with the new competitive rates and services, officials told Congress on Wednesday.

Under the GSA Federal Technology Service's Metropolitan Area Acquisition program, transition to the new contracts must be completed within nine months after contractors are authorized to begin service. But out of the 25 cities that have passed that deadline, only four have completed the move, according to a review by the General Accounting Office.

The MAA contracts are the first awarded in the newly deregulated local telecommunications market. Although deregulation has reduced prices dramatically, it also is the source of "unexpected barriers to implementation, which take time to resolve," said Linda Koontz, director of information management issues at GAO, testifying before the House Government Reform Committee's Technology and Procurement Policy Subcommittee.

MAA contractors — including AT&T, Qwest Communications International Inc., Verizon Communications, Winstar Communications Inc. and BellSouth — also cited the lag between the time vendors receive approval to operate from a FTS regional office until the time they start making orders on the contract. That lag time averages about four months, which takes a significant chunk out of the nine-month transition deadline, said Jerry Hogge, vice president of government solutions and enhanced service providers at Winstar.

Winstar and the other vendors offered several recommendations for improving the MAA program, including reducing GSA's administrative fees, adding data and networking services to the contract, and providing financial assistance for agencies to cover transition costs.

A big part of the delay in orders comes from agencies' concern over the cost of switching providers, Koontz said. According to an internal GSA inspector general management report issued in April, agencies did not set aside funding in their budgets to cover one-time costs such as service cancellation charges for the former provider, initiation charges for the new provider, and the cost of upgrading hardware.

Agencies that have made orders and are undergoing the transition are happy with the service they are receiving and find that their delays are "manageable ones," said Louis DeFalaise, acting director of the Executive Office for United States Attorneys.

"We have been favorably impressed so far," he said.

The agency's Islip office has almost completed its transition, and the cost of its phone service per line has dropped from $35 a month to $10 to $12 a month. Another plus is that through the MAA contract, GSA will manage billing, trouble-shooting and general contract management "so our staff doesn't have to deal with it," DeFalaise said.

The Coast Guard awarded its contract in New York in 1999 and has had delays and a major outage in April 2000. But that was fixed quickly and the agency now has an agreement with GSA and the vendor to ensure that there are no future impacts on Coast Guard operations, said Cmdr. Robert Day, commanding officer of the Coast Guard's electronic support office in Boston.

Overall, the contract is saving the agency $150,000 per year, and that was why the Coast Guard started on the project in the first place, Day said.

Despite general customer satisfaction, the slow transition is still a major concern because delays may offset savings, said Rep. Tom Davis (R-Va.), chairman of the subcommittee.

Davis has asked GAO to continue its review of the MAA program and report back by the end of the year, and the next step will be to see how GSA plans to use the recommendations from vendors, he said.

"I think one of the problems we've had is we've set unrealistically high expectations and timetables," he said.