GAO: ACE NEEDS FURTHER ACQUISITION MANAGEMENT IMPROVEMENTS

GAO: ACE NEEDS FURTHER ACQUISITION MANAGEMENT IMPROVEMENTS    A new multibillion-dollar computer system to manage the U.S. government’s customs activities meets the general requirements for funding appropriations, but federal regulators believe further improvements are needed in its acquisitions management.
   The Customs Service, now part of the Bureau of Customs and Border Protection, is seeking the release of $314 million from Congress for on-going development of its Automated Commercial Environment (ACE).
   Senate and House appropriators asked the Government Accounting Office, a federal watchdog agency, to ensure that Customs’ systems budget request is justified.
   GAO said the agency satisfies the legislative conditions specified in Customs’ appropriations act, such as meeting the capital planning and investment control review requirements of the Office of Management and Budget, and complying with the agency’s “enterprise architecture.”
   On April 27, 2001, Customs awarded its ACE development contract to an IBM Global Logistics-led systems team, called “e-Customs Partnership.” The core of the team includes IBM, Lockheed-Martin Corp., KPMG Consulting, Computer Sciences Corp., and Sandler & Travis Trade Advisory Services.
   In August 2001, Customs created a Modernization Office in Washington to oversee the ACE contract, which the GAO praised.
   However, the GAO said more work is needed by the agency to improve the development of its “human capital strategy” and implementation of certain acquisition practices, including “project office management and acquisition risk management,” which had been recommended by the GAO in 1999.
   While the GAO noted the ACE contractor’s field tests using “best practices” are positive, the agency said Customs does not use independent verification and validation to oversee these tests.
   “Customs states that it is relying on the contractor’s reputation and maturity level as guarantors of system quality, which is not adequate for a complex and risky program like ACE,” the GAO said.
   The agency is expected to build ACE over the next four to five years, but it’s uncertain what impact Customs’ move to the new Homeland Security Department will have on the system’s development. “(T)here is the potential for existing ACE cost and schedule commitments to change,” the GAO said.