Efficiency vs. fairness

The Federal Aviation Administration's attempt to streamline the acquisition of a modern air traffic control system by awarding a single-source contract is drawing scrutiny for its unorthodox approach.

On Feb. 6, the FAA announced on its Web site its intention to award a single-source contract to Lockheed Martin Corp. and its subcontractor, Computer Sciences Corp., to modernize the computer hardware and software at its 20 en route centers. En route centers take over air traffic control after an aircraft leaves an airport's airspace, typically a 50-mile radius around the airport.

The agency may be forced to reconsider its plan and open competition for the En Route Automation Modernization (ERAM) program when Raytheon Co. submits its proposal to the FAA later this month. Raytheon countered the Feb. 6 notice and is preparing a statement of its qualifications and capabilities to meet the FAA's requirements.

"We felt we would come down to one vendor anyway," said Steven Zaidman, FAA associate administrator for research and acquisitions. "We wanted to save time and bid-and-proposal costs."

Although Zaidman said that this is not the typical way the FAA awards proj-ects, he said Lockheed Martin's years of experience with the FAA's en route environment and the time sensitivity of the program made Lockheed Martin the safest choice.

The situation highlights how the FAA is struggling to use the acquisition reform it instituted in 1996, which allows it to make procurements more quickly and efficiently while still meeting government and industry expectations of fairness. Recent FAA acquisitions call for nondevelopmental items that require little modification. For instance,the procurement of a replacement for the agency's oceanic air traffic control system, which will be awarded this summer, requires the bidders to demonstrate an existing oceanic system.

About a year after the FAA finished replacing the computer hardware and controller display systems at the en route centers, the agency has already focused on how to keep pace with technology by replacing them again and rewriting the software they use. Mainframe computer manufacturer IBM Corp. has told the agency that by 2008, its operating system will not be able to process the applications that move airplanes around in the National Airspace System, Zaidman said.

"It's time to move on and modernize the larger part," Zaidman said. "We looked at the requirements and the complexity of air traffic control, and we felt we needed a systems integrator. We felt that we needed to retain some expertise."

Lockheed Martin has replaced the FAA's host computer system — the primary air traffic control automation computers — and completed the Display System Replacement, which replaced air traffic controllers' consoles. CSC designed much of the software that runs the host computers.

"Every contract milestone over the five-year, $800 million effort was met on or before schedule and on or under budget," said Julie Vass, a Lockheed Martin spokeswoman.

The FAA had been exploring options since late last fall for how to modernize the en route system and decided on Lockheed Martin before the end of the year, Zaidman said.

The stakes are high, with an estimate by Zaidman that the contract could be worth several hundred million dollars. The FAA has budgeted $33 million for ERAM in fiscal 2001. Transportation Department Inspector General Kenneth Mead said in a hearing before a House subcommittee March 8 that the value could be $1 billion.

That's why Raytheon, which is designing the FAA's satellite-based navigation system, stepped in. Raytheon objected to the sole-source award to Lockheed Martin and is preparing to submit its qualifications by March 21, said Blanche Necessary, a Raytheon spokeswoman.

Frank Marchilena, an executive vice president of Raytheon, said in a statement that Raytheon has already delivered modern air traffic control solutions to Canada and Germany and supplies the FAA's en route backup system, the Direct Access Radar Channel.

Rep. Martin Olav Sabo (D-Minn.), ranking member of the House Appropriations Committee's Transportation Subcommittee, asked Mead why the FAA preferred to hand the business to Lockheed Martin without a competition. "Congress gave FAA exemptions from the procurement laws to act more like business," Mead responded. The "FAA would point to its procurement reformauthority as its reason."

Mead said that the FAA's performance in the last few years on acquisitions has improved, as long as they did not involve extensive software development — which ERAM does. Mead said he advocates an independent review board to assess the ERAM acquisition. "The host needs to be done," Mead said. "Whether it should be a competitive procurement, the jury's still out, and we'll see what other contractors say their capabilities are."

After the FAA reviews Raytheon's submission, it can decide to open competition to any company, open a limited competition between Lockheed Martin and Raytheon or "go with a single-source like we originally proposed," Zaidman said.

The air traffic controllers who will use ERAM support the proposal to award Lockheed Martin a sole-source contract in which one company integrates all the products and serves as the interface with the users, said Scott Ginsburg, technical representative from the National Air Traffic Controllers Association.

En route to a new system

The Federal Aviation Administration's En Route Automation Modernization (ERAM) program will update the hardware and software used to operate the agency's 20 en route centers, which provide air traffic control services for aircraft when they leave an airport's airspace. The goal is to create a cohesive system for flight data and surveillance data processing.

The current system's software is written in outdated languages. Under ERAM, the code would be rewritten in a modern language. The system would also be designed to enable upgrades to the air traffic control system, such as satellite-based navigation systems.


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