Award shows discrepancies in current system

The Energy Department's award of a $409 million task order to RS Information Systems Inc. last month illustrates the pros and cons of current multiple-award contracting practices.

Currently, the rules allow businesses to qualify for small-business set-asides even after they have grown larger than standards set for such contracts.

All of the finalists for the Energy order'ITS Services Inc., QSS Group Inc., RSIS and STG Inc.'have annual revenue ranging from $31 million to $190 million. Although the four companies had grown significantly since qualifying in 1999 for the Commerce Information Technology Solutions GWAC, a five-year set-aside for small businesses, they were allowed to bid on Energy's task order because federal rules do not require periodic size recertification.

Under the IT Integrator Support Services task order, RSIS of McLean, Va., and its subcontractors will handle IT and telecommunications support, cybersecurity and enterprise architecture for Energy offices.

When the order was awarded, some contractors took offense that Energy secretary Spencer Abraham had noted that creating opportunities for small businesses was a priority at his department.

'Saying this is a boon to small business is an affront to the entire small-business community in Washington,' said a manager of one Washington-area IT company.

But under the contract rules, Energy did award to a small business, spokeswoman Corry Schiermeyer said.

'The company is considered a small business,' she said. 'Our goal is to have the most-qualified people doing the work.'

Some observers said the RSIS award is proof that the COMMITS vehicle does what it was designed to do'provide good IT contracting opportunities for small businesses, and in the process let them grow over a five-year period.

Bigger, but not big enough

'Vendors are becoming big during this five-year period, but it's not necessarily giving them the leverage they need to compete against larger businesses,' COMMITS program manager Tina Burnette said. 'The five-year performance period allows them to become more competitive by establishing their performance record in the industry, thereby increasing their opportunity for success.'

Rodney Hunt, RSIS president and chief executive officer, said his company will provide opportunities for other small businesses under the Energy task order. RSIS will perform 50 percent to 55 percent of the work; its four large subcontractors will share 30 percent of the work; and its 10 small-business subcontractors will share the remaining 15 percent of the work.

'Out of $409 million, 15 percent for other small businesses is roughly $61 million. Not bad over five years,' he said.

Gail Repsher Emery is a staff writer for Washington Technology, a Post Newsweek Tech Media publication.

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