Treasury cancels TCE procurement

The Treasury Department has decided to cancel its controversial Treasury Communications Enterprise (TCE) contract, and will instead use the General Services Administration’s Networx contract, agency officials confirmed.

“The department believes where we stand today, Networx makes the most sense for the taxpayer and the department when considered over the 10 year contract period,” said Treasury spokeswoman Eileen Gilligan. Networx meets our needs, she said.

The decision marks a significant turn for the agency that had resisted many calls to use the Networx contract, which is slated to be awarded next year and is a governmentwide contract vehicle.

The move also comes as Ira Hobbs, Treasury’s chief information officer, is set to retire early next year.

This is the latest turn in the history of TCE, which often has been at the center of controversy. A Treasury Inspector General audit in February found TCE deficient. In 2005, Treasury officials ended the TCE procurement, terminating the deal with AT&T and pledging to use GSA contracts, only to reverse their decision several months later.

Rep. Tom Davis (R-Va.), chairman of the House Government Reform Committee, was one of the most vocal opponents of TCE. He even warned that he would seek to eliminate funding for the Treasury telecommunications system. Davis has said he favors a governmentwide approach to issues such as network telecom rather than allowing individual agencies to manage it on their own.

“He's extremely pleased, not just because reason has finally prevailed and there's now consensus behind the approach he's been pushing for years,” said Davis spokesman Dave Marin. "But more importantly because this is a win for good government, for all those who care about getting the biggest bang for the taxpayers buck."

GSA Administrator Lurita Doan has argued that TCE made it more difficult for GSA to get the best prices on its Networx contract.

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