Treasury to receive Networx fee discount: GSA

The Treasury Department will receive a discount on fees for using the governmentwide Networx contract because it brings some new requirements for services that the General Services Administration does not already provide.

John Johnson, assistant commissioner for integrated technology services in GSA's Federal Acquisition Service, described that and other details of its agreement with Treasury to cancel the departmentwide Treasury Communications Enterprise contract and move to Networx. Treasury signed the agreement the day before it canceled TCE last month.

'This is a good thing for government because we are now beginning to integrate disparate networks across the government into a homogeneous platform that will provide improved interoperability, improved security and other improvements,' he told reporters in a teleconference yesterday.

GSA expects to award the Universal component of Networx in March and the Enterprise component in May.

Among the provisions of the agreement, GSA will share in costs due the bidders related to Treasury canceling the RFP if any are awarded, reduce by half Treasury's Networx service fee and give Treasury the ability to place orders under Networx within 30 days of the contract being awarded.

Treasury is bringing over new requirements for services that are currently not part of FTS 2001, which satisfies about 50 percent of its requirements. The FTS 2001 requirements will not receive the fee reduction, but the new requirements will.

'That means Treasury will not be receiving some of the value-added support that GSA provides in helping to massage the requirements and working with them to make sure that their statements of work are solid. Treasury will have to do that on its own,' Johnson said.

GSA will apply the reduced fee only when Treasury completes its migration to Networx.

Johnson does not anticipate other agencies negotiating for special fee arrangements because Treasury is bringing some unique requirements.

'I think we have a strong relationship with other agencies in providing assistance and support for them. They understand that, strategically, bringing Treasury to the table is a very good thing in terms of helping to achieve that seamless, secure, interoperable government that we envision. The issue of fees, while important, is not as important as that strategic objective,' he said.

Treasury's requirements for services will add about 5 percent more volume to the overall Networx requirements package. It's not expected to raise the total value of Networx above the currently estimated $20 billion over 10 years.

'There could be the potential for the Treasury requirements to have some positive influence on pricing for Networx Enterprise. But there is no guarantee of that. And as far as future fees post-transition, it has long been our intent to develop some type of tiered arrangement. But we're still in the conceptual stages of that,' Johnson said.

GSA also has agreed to share in the costs associated with the cancellation of TCE if costs are awarded. Three bidders have filed with the Government Accountability Office to recoup their expenses under the protest process.

The funds would not be taken from the Networx transition account for the customer agencies who participated in the FTS 2001 program. It would come from GSA, Johnson said. But he couldn't answer from where in GSA.

About the Author

Mary Mosquera is a reporter for Federal Computer Week.

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