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GSA awards 15-year contract to e-travel provider

Jun. 8, 2012 - 12:42PM   |  
By NICOLE BLAKE JOHNSON   |   Comments

The General Services Administration has selected a new contractor to provide e-travel services for all federal agencies, except the Defense Department, by the end of the year.

Following delays because of legal challenges, GSA this week awarded a 15-year contract to Washington-based Concur Technologies Inc. The company replaces three contractors that have provided government travel services under a 10-year contract that expires in November 2013.

GSA has promised that the new cloud-based system — which will look much like Travelocity and Orbitz — will be easier to navigate, offer a better display of pricing options and offer green travel alternatives such as Web-based conferencing.

That is welcome news to Bureau of Reclamation employee Marcia Jones. Though an infrequent traveler, she isn’t immune to the headaches of booking business trips through the current system.

While booking a flight from Denver to Boise, Idaho, the system forced her to select flights under the government’s prenegotiated rates, which would have taken an extra day of travel. Colleagues have been left in a bind after booking recommended hotels in rural areas that had gone out of business or closed due to natural disasters, she said.

“Trying to make adjustments is nearly impossible,” said Jones, whose agency uses GovTrip, one of three systems currently available.

Concur Technologies has more than 18 million users across major financial and auto manufacturing companies and other industries. Each year, it processes 55 million transactions worth more than $50 billion in travel and expense spending, according to Concur.

The GSA contract has a three-year base period and three four-year options, which could total $1.4 billion if all options are exercised and the system is used at all agencies.

Services will include travel planning and authorization and expense reimbursements. The company also offers a mobile application for feds to create and approve expense reports, book flights and hotels and do other tasks while traveling.

Most of a traveler’s expense report will be populated for him, based on charges to his government-issued credit card, Rajeev Singh, Concur president and chief operating officer, said in an interview.

The system will provide hotel and other recommendations based on past travel preferences to streamline searches, Singh said. Government rates will be listed prominently.

Federal employees have frequently griped about their current travel booking systems. Customer satisfaction ratings in 2010 for the current systems ranged from 49.5 on a scale of zero to 100 for GovTrip, operated by Northrop Grumman Mission Systems, to 51.5 for E2 Solutions, operated by CWT Sato Travel. FedTraveler, from HP Enterprise Services LLC, scored 50.7.

The cost to transition to the new system and the level of complexity and time will vary by agency.

“We are going to reach out to every single civilian agency … that’s covered underneath the terms of this agreement and present them with a strategy to move,” Singh said.

GSA has been working with agencies for two years to plan a timely transition. The first transaction could occur as early as late this year. GSA also has bridge contracts with current vendors to help agencies that can’t move to the new system before the existing contract ends in November 2013.

Getting to this point hasn’t been without complications.

The new contract was delayed by legal challenges from CWT Sato Travel. The company filed a claim with the U.S. Court of Federal Claims in May 2011 following two protests with the Government Accountability Office. The company argued that GSA’s solicitation for the new contract was ambiguous, contained overly restrictive provisions, improperly used Federal Acquisition Regulation policies and exposed contractors to excessive risks.

Although the judge agreed with some of the company’s objections, GSA got a waiver to move forward with the contract.

CWT Sato Travel teamed with Northrop Grumman to bid on the new contract but lost to Concur. Combined, they currently serve about 75 percent of federal travelers.

CWT Sato Travel has requested a formal debriefing statement from GSA to understand the basis of the award.

An industry source said he would be surprised if the award wasn’t protested, considering that one company will have a monopoly on federal e-travel for the next 15 years. Some agencies are considering whether to award their own e-travel contracts, he said.

Under GSA’s e-travel contracts, it receives a fee per transaction when feds book trips electronically.

A GSA spokesperson admitted that transactions under the new system may decline as travel budgets are slashed.

Concur’s Singh is optimistic but will have to answer to investors about the financial implications of the deal during the company’s third-quarter earnings call.

“The reality is you can’t stop travel entirely and expect to be able to get your job done,” he said about the government. “What you can do is say, ‘I want to be more efficient.’ ”

An executive order signed by President Obama in November calls on agencies to use travel sparingly, only when it requires workers to be away from their desks, such as for diplomatic missions and enforcement inspections.

Jones, who also serves as president of the International Federation of Professional and Technical Engineers Local 28, said the Bureau of Reclamation has cut most travel for employees who can use videoconferencing or webinars.

“If you don’t have a bona fide, rational reason to leave your office for travel purposes, you don’t leave it,” she said.

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