As of March 2015, the Department of Homeland Security (DHS) had issued 74 Enterprise Acquisition Gateway for Leading Edge Solutions II — or EAGLE II — task orders worth an estimated $591 million, almost all of which — 94 percent — went to small businesses.
“However, it is too soon to evaluate the full impact of these steps because only about 3 percent of the anticipated $22 billion in task orders have been issued,” a new Government Accountability Office (GAO) audit reported.
As one of DHS’s strategic sourcing initiatives, EAGLE II is intended to increase the efficiency of DHS’s acquisition and mission support capabilities, as well as improve fulfillment of socioeconomic contracting goals. The EAGLE II program is a suite of strategic sourcing contracts, ultimately valued at $22 billion, which serves as DHS’s mandatory source for information technology services. Strategic sourcing is a process that moves an organization away from numerous individual procurements toward a broader aggregate approach to achieve cost savings and other efficiencies.
But, “The small business community has raised questions about strategic sourcing reducing contracting opportunities,” GAO stated.
DHS established five goals for EAGLE II and developed performance measures to assess progress in meeting most of them. DHS established performance measures for the three EAGLE II goals related to cost savings and efficiencies through a methodology to assess cost savings, but has not fully set performance measures for the remaining two, relating to the small business socioeconomic goal, and enhancing DHS mission capabilities, GAO determined.
“For its socioeconomic goal,” GAO said, “DHS assesses progress via the percentage of the value of orders issued to small businesses. However, DHS does not assess whether use of team members (other small businesses) supports this goal, although DHS procurement officials told us teaming is key to enhancing small business participation. Further, DHS has not set a performance measure for assessing how the use of teaming coordinators contributes to the EAGLE II goal of enhancing DHS’s mission capabilities.”
GAO said, “According to DHS, prime contractors are required to have teaming coordinators identify subcontractors with innovative services. Federal internal control standards highlight the importance of developing measures to compare expected outcomes to actual results.”
But, “Without such measures, it will be difficult for DHS to have needed information to assess the extent to which the use of team members and teaming coordinators contribute toward their respective EAGLE II goals,” GAO reported to lawmakers.
GAO recommended that DHS Secretary Jeh Johnson fully “support implementation of EAGLE II goals by assessing the use of team members and teaming coordinators.”
DHS did not concur with GAO recommendations, citing actions already taken in soliciting and awarding the contracts.
In response, GAO auditors said they “believe there is still value in assessing whether team members are used for task orders, and that DHS’s plan to survey EAGLE II users has merit.”
EAGLE II is the successor to EAGLE, which DHS used to procure information technology services from 2006 through 2013. The period of performance for EAGLE II includes a 5-year base period, from 2013 through 2018, and one 2-year option period, from 2018 through 2020.
EAGLE II contracts are structured as multiple-award Indefinite Delivery Indefinite Quantity (IDIQ) contracts. Indefinite delivery contracts can be used when the government needs flexibility in the timing of orders within a specified period of time. Indefinite-quantity contracts provide for an indefinite quantity, within stated limits of supplies or services during a fixed period. Multiple-award refers to the fact that more than one prime contractor is awarded a contract. After award of a base IDIQ contract, products and servicesare procured through individual task orders during the contract period.
DHS’s chief procurement officer was responsible for awarding the EAGLE II IDIQ contracts, while other DHS components like the United States Coast Guard and Transportation Security Administration can issue task orders based on their own individualized needs and requirements.
The EAGLE II program has been under fire from the House Committee on Homeland Security since 2013.
In a November 5, 2013 letter from Rep. Michael McCaul (R-Texas), chairman of the House Committee on Homeland Security, and Rep. Jeff Duncan (R-SC), chairman of the Subcommittee on Oversight and Management Efficiency, they expressed numerous concerns, including saying DHS “took too long” to make awards under the department-wide IT acquisition program, and had “failed to ask vendor companies to update their pricing with a Best and Final Offer (BAFO).”
Responding to the legislators’ concerns that DHS took “nearly three years to award this contract," the EAGLE II acquisition team said in an attachment to then DHS Chief Procurement Officer Nick Nayak’s December 2 letter to McCaul and Duncan that “EAGLE II consisted of nine distinct competitions which resulted in more than 95 contract awards,” and that “DHS began awarding contracts 21 months after proposals were received and completed contract awards within 31 months."
Nayak and former DHS procurement ombudsman Jose Arrieta wrote about DHS’s complex procurement processes and how DHS deals with contractors in their exclusive August/September 2014 Homeland Security Today report, DHS’s Key to Improving Acquisition Outcomes.