Agency Halts Bidding on Government Phone System, to Split Job With 2 Firms

Bowing to pressure from Congress, the General Services Administration on Friday suspended bidding on a contract for a $4.65-billion government telecommunications network five days before the bid deadline.

The agency said it will abandon its winner-take-all approach and revise the contract to divide the work between two competing contractors, a strategy favored by Rep. Jack Brooks (D-Tex.), chairman of the House Government Operations Committee.

The delay is the fourth since the contract--one of the biggest ever let by the government--was sent to bid last January. The previous three delays postponed the deadline by one month each time, but Friday’s action is likely to set the process back at least six months.

The new telecommunications system, called FTS-2000, will replace the government’s existing 25-year-old phone system with a state-of-the-art network for voice, data, video conferencing and other communications services.

In letters to Brooks and the companies competing for the contract, GSA Administrator Terence C. Golden said he was reluctantly abandoning his single-vendor approach in favor of the multivendor strategy sought by Brooks and other members of Congress.

Two teams of companies developed bids for the project, one led by American Telephone & Telegraph Co. and the other by Martin Marietta Corp. with MCI Communications Corp.