Senators skeptical on future of Defense Travel System

The Defense Department's electronic travel booking system came under fire at a congressional hearing Thursday, with senators and panelists drawing comparisons to the FBI's failed Virtual Case File program.

The Pentagon should consider cutting its losses and scrapping the $474 million Defense Travel System, witnesses told the Senate Homeland Security and Governmental Affairs Subcommittee on Investigations.

Zack Gaddy, director of the Defense Finance and Accounting Service, defended the travel system, but no one from the program management office or from DTS contractor Northrop Grumman Mission Systems testified on the system's behalf.

The pressure to cancel DTS originates from travel industry groups that want the system re-bid under the General Services Administration's eTravel Service, DTS Program Manager Col. Brandy Johnson told Government Executive. Johnson said that she was not asked to testify and that the witnesses presented old and misleading data.

"DTS has had very serious problems," said Sen. Norm Coleman, R-Minn., chairman of the subcommittee.

The Defense Department has been unresponsive to questions on whether the system -- which is projected to save the government $56 million a year when fully deployed in 2007 -- is effective, Coleman said.

Pentagon officials renegotiated the DTS contract with Northrop Grumman in 2002, arriving at a deal in which the department would pay most of the development costs. Coleman and other panelists repeatedly questioned whether the Defense Department fully owns the program, saying that if the Pentagon contracted with another company, the development work completed by Northrop would be lost.

But Gaddy confirmed that another company could take over the DTS contract without any waste of development money because the 2002 agreement stated that the Pentagon owned the software developed specifically for DTS and would have an unrestricted license to Northrop's off-the-shelf software.

No one disputed that DTS would ultimately save the government money on transactional costs. Booking an airline ticket using DTS costs about $5 compared to $25 using a travel agency, for instance.

But senators questioned whether the system consistently found the lowest airfares. An independent test in February 2005 showed that the GSA's city pair fares were excluded 7 percent to 8 percent of the time, though DTS officials said during the hearing that the problem had been resolved.

Robert Langsfeld, a partner of the Corporate Solutions Group, a Menlo Park, Calif.-based research firm holding a GSA contract to audit DTS and eTravel, was critical of DTS' ability to find the lowest fare. When CSG told DTS and eTravel officials about this problem, they reduced the scope of the audit contract significantly, he testified.

"DTS development and implementation have been problematic" and "critical flaws" have caused the program to fall behind schedule, said McCoy Williams, director of the GAO financial management and assurance team. While DTS is connected to 32 Defense systems, 17 remain unconnected, Williams testified. Where DTS has been deployed, it has been underused, he added.

Sen. Tom Coburn, R-Okla., the chairman of the Senate financial management subcommittee, questioned DTS' value, submitting five pages of queries to the DTS program management office and saying he wants them answered within two weeks. Coburn is considering legislation that would require the Pentagon to use one of GSA's eTravel contractors.

Thomas Schatz, president of the Washington, D.C.-based government watchdog group Citizens Against Government Waste, also recommended canceling the DTS contract in favor of the services provided on GSA's eTravel contract. DTS is "nothing more than a government-subsidized monopoly," he said, citing a year-old report that detailed DTS cost overruns and unmet expectations.

But Northrop and DTS have repeatedly said that the travel systems provided under eTravel are not adequate for the Defense Department's complex financial and managerial systems and that all four major computer reservation systems are capable of plugging into DTS.

Rich Fabbre, Northrop's DTS program manager, told Government Executive that when DTS development is complete next year, the Pentagon would pay Northrop about $25 million to $30 million a year to operate the system.

"[DTS] is sixty percent of the federal government business, and the others want that business," Fabbre said. "I think a lot of the testimony today is based on very dated information."

The Society of Government Travel Professionals issued a statement supporting both DTS and eTravel, but Marc Stec, the group's president, was not permitted to testify. He was originally scheduled to appear on the second of three panels.