Questions on the impact of contract protests arise after JEDI

Sen. Kevin Cramer (R-N.D.) said protests and lawsuits that can delay or lead to program cancellation could be holding up the Defense Department's technological progress, naming JEDI as the latest example.

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The Pentagon cancelled its embattled $10 billion Joint Infrastructure Defense Enterprise cloud program, and now questions about whether extended contract protests harm warfighter needs are resurfacing.

Sen. Kevin Cramer (R-N.D.) said protests and lawsuits that can delay or lead to program cancellation could be holding up the Defense Department’s progress when it comes to advancing its technological capabilities -- particularly when it comes to the cloud services JEDI was designed to deliver.

“Some of the protests and lawsuits can delay or even cancel a very important program -- and of course, just recently, the most recent victim is the JEDI Program, which has now been canceled,” Cramer said during a July 13 Senate Armed Services Committee nomination hearing for several Defense Department positions, including deputy comptroller.

“Some of these protests and lawsuits do a more effective job of holding up our progress than our enemies could do if they were working that hard at it.”

When asked, from a financial perspective, how a perpetually delayed or cancelled program could affect military readiness, Kathleen Miller, the Biden administration’s pick to be the deputy under secretary of defense (comptroller), said there was likely room to revisit applicable laws.

“You raise a really important point about how do we continue to deliver cutting-edge technology quickly to our fighting forces and how do we do so economically,” Miller said. “At the present we have to follow the rule of law in terms of contracts and contract disputes, and that there may be room inside of there for re-looking [at] that given the kinds of delays that we have experienced, moving forward.”

Miller also highlighted alternative contracting methods, such as other transaction agreements, that DOD has used to speed tech adoption and could help streamline contracting and acquisition. In submitted responses to advanced policy questions, Miller wrote that she would prioritize updating financial management regulations to help DOD “take advantage of emerging technologies” with existing authorities.

“In many cases, the budget process is neutral with respect to what type of contracting vehicle or process is used given the current appropriation structures,” Miller wrote.

“If confirmed, I will work with the Comptroller and the Under Secretary for Acquisition and Sustainment and other key stakeholders to ensure the financial management regulations are updated to enable any specific permissions or flexibilities afforded the Department and to look for opportunities for additional innovations or improvements to take advantage of emerging technologies and to address emerging threats.”

But Cramer seemed unsatisfied, saying that even OTA contracts can face legal trouble.

“I appreciate all that, I do appreciate your optimism -- and all those alternatives still get menaced by lawyers, of which you dodged that bullet, I understand,” he said. “But thank you.”

The line of questioning comes after DOD announced it was cancelling the JEDI contract nearly two years after its initial award to Microsoft. The award had endured legal challenges, including accusations of political interference and preferential treatment for certain vendors.

But the issue of trying to limit the potential disruptions caused by procurement protests isn’t new. Brad Smith, Microsoft’s president, raised the issue earlier this year, telling senators that JEDI’s progress was hampered by the meandering protest process. "How do you move quickly when the protest process moves slowly?" he asked.

Smith suggested legal reforms and tighter, enforced deadlines to speed the protest process, rather than getting rid of it altogether.

"We don't think that others should be denied an opportunity to protest," Smith said. “Maybe for better and worse, that is a part of the American way to some degree. But it sure would be beneficial if it could move faster.”

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