Audit of controversial TSA contract due out next month

An audit of a contract awarded shortly after the 9/11 terrorist attacks to assist in hiring Transportation Security Administration workers remains held up in the Homeland Security Department inspector general's office.

The IG's review of the controversial contract has been in the "final stages" since September, but has yet to appear. Tamara Faulkner, a spokeswoman, would not give a reason for the delay, but said the review is now expected to be released in early January. The final report first will be distributed to department officials, then to Congress and then to the public.

The contract to hire about 55,000 screeners, awarded to Pearson Government Solutions in early 2002, already has been scrutinized by the Defense Contract Audit Agency, an arm of the Defense Department that provides auditing services to outside agencies. In June, The Washington Post reported that the DCAA audit questioned $303 million of the $741 million contract.

Among the challenged costs were $1,180 for 20 gallons of Starbucks coffee, $1,540 to rent 14 extension cords for three weeks, and $8,100 for elevator operators in Manhattan, the Post reported.

Pearson has publicly disagreed with DCAA's findings, and spokeswoman Eileen Rivera says media stories on the contract have sensationalized it. "Information was presented in a way that was not accurate," she said.

The IG audit is expected to provide a much broader look at TSA's acquisition management than the DCAA audit, which focused on invoices and contract costs.

Lee Kair, assistant administrator for acquisition at TSA, said in August that the contract was structured appropriately and was monitored closely. "TSA does not believe that procurement regulations were violated in the management of the NCSP contract, though resources limited our ability to implement best practices," he said.

When the contract was awarded in February 2002, TSA's acquisition office did not yet exist, Kair said. Since then, it has expanded significantly, he added.

Kair said some of the contract's cost increases could be explained by changes in requirements and deadline pressure. At first, TSA estimated that the contract would require between 30,000 and 55,000 screeners to be hired. In the end, about 55,000 were hired in 150 days, but only after more than 328,000 candidates were assessed.

"The contract demanded performance and schedule," Kair said, "which came at a cost that exceeded initial estimates."