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Friday, March 31, 2006

Management flaws cited for failed DHS contract

"A contract for a project to integrate financial data across the Homeland Security Department collapsed because management challenges were underestimated, a DHS official told lawmakers Wednesday.

BearingPoint Inc. in September 2004 won a blanket purchase agreement worth up to $229 million to work on the project, known as eMerge2. The contractor was to help fuse eight legacy financial systems, but within weeks the department realized that the project was unacceptably off schedule and the contract had problems, said Eugene Schied, DHS' acting chief financial officer.

Approximately $18.3 million was spent on the contract -- $9.4 million for the project's initial phase and $8.9 million under a task order that originally was worth $20 million, Schied testified at a joint hearing of House Government Reform and Homeland Security subcommittees. "

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