The Homeland Security Department hasn't even selected a contractor for its ambitious departmentwide enterprise resource planning project and already the DHS inspector general is worried.

The effort, known as Transformation and Systems Consolidation, or TASC, will almost certainly cost more than the $450 million DHS has said it will and key planning documents have yet to be completed even as DHS moves forward on evaluating contractor proposals, a July 8 IG report states.

DHS issued a request for proposals for "end-to-end business processes in support of financial, acquisition and asset management," as well as for integration services and program management support with the intention of making an award by the second quarter of fiscal 2010--which ended March 31--the report states.

Among the missing planning steps DHS has, as of October 2009, to complete is an acquisition program baseline against which progress toward goals could be measured and a concept of operations, the IG report states.

Also missing has been a life cycle cost estimate. DHS did come up with a cost estimate as part of annual budget submissions to the Office of Management and Budget, but the estimate "does not identify any cost estimates for the project's hardware, software, and sunk costs."

DHS has kept to program management best practices by hiring an independent verification and validation contractor--except that the contractor is not independent, the IG states. Under the TASC program organization structure, the IV&V team reports to the project director, and the TASC program is responsible itself for paying the IV&V contractor.

TASC program managers have also limited the role of the DHS chief information officer in the project, in part because TASC has faced several protests in federal court, the report states.

In the department's official response to the audit, Peggy Sherry, the deputy chief financial officer, mostly agreed with the audit's findings. The IV&V reporting chain has changed so now the team reports to the CIO, she wrote, and the program management office "is in the process of finalizing several documents working in conjunction with the [office of the] CIO," she added.

For more:
- download the report, OIG-10-95 (.pdf)

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