[saic] Contractor has close ties with staff of NSA

[Daily SAIC News]

29 January 2006 ; Baltimore Sun
Contractor has close ties with staff of NSA
http://www.baltimoresun.com/news/nationworld/bal-te.saic29jan29,1,5221259.story

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By Siobhan Gorman
Sun reporter

When the National Security Agency went shopping for a private contractor
to help it build a state-of-the-art tool for plucking key threats to the
nation from a worldwide sea of digital communication, the company it chose
was Science Applications International Corp.

More than three years later, the project, code-named Trailblazer, still
hasn't gotten off the ground. And intelligence experts inside and outside
the agency say that the NSA and SAIC share some of the blame.

Investigations of Trailblazer's early years by Congress and the NSA
inspector general criticized the agency for its "confusion" about what
Trailblazer would ultimately accomplish and for "inadequate management and
oversight" of the program to improve collection and analysis of mountains
of digital information.

Unsolved problems

When SAIC came on board as the lead contractor in 2002, NSA had not solved
those problems, said intelligence officials with extensive knowledge of
the program.

But SAIC did not provide computer experts with the technical or management
skills to pull off a system as complex as Trailblazer, the intelligence
experts said. Moreover, they said, SAIC did not say no when NSA made
unrealistic demands.

Trailblazer has cost taxpayers an estimated $1.2 billion, former
intelligence officials told The Sun.

"The system in the Pentagon and defense-related agencies is notoriously
susceptible to slippage and overruns," said Gordon Adams, director for
security policy studies at George Washington University.

"A lot of the [information technology projects] are traffic accidents
waiting to happen," said Adams, who was speaking generally. "There's a
penchant, particularly in the [information technology] area, to overdesign
things, promise it will deliver all kinds of things and not be able to
deliver on the project."

SAIC is among the fastest-growing government contractors in the country,
expanding from an annual revenue of $243,000 in 1970 to more than $7.2
billion today.

43,000 employees

The federal government accounts for two-thirds of San Diego-based SAIC's
work, and the company has offices in 29 Maryland communities.

Some of SAIC's 43,000 employees worldwide could become millionaires if the
company follows through on its plans to go public this year.

As SAIC has grown, it has forged close ties to several key defense and
intelligence agencies, including the NSA. Among those who have served on
SAIC's board of directors are former NSA Director Bobby Ray Inman; former
CIA Directors John M. Deutch and Robert M. Gates; and former Defense
Secretaries Melvin R. Laird and William J. Perry.

The door swings so regularly between the NSA and SAIC that the company has
earned the nickname "NSA West" inside the intelligence community.

The Trailblazer project illustrates that point. William B. Black Jr.
retired from his position in the elite senior cryptologic executive
service at the NSA in 1997 to take a job as assistant vice president at
SAIC.

Three years later, NSA Director Michael V. Hayden called Black back to the
spy agency. By 2002, Black was overseeing NSA's Trailblazer project, with
SAIC as its prime contractor.

Two other top NSA managers who worked on Trailblazer - Hal Smith and Sam
Visner - also left the spy agency for jobs at SAIC. There, Smith worked on
Trailblazer and the FBI's Virtual Case File program, according to a former
senior intelligence official who spoke only on the condition of anonymity.

The FBI pulled the plug last year on the $170 million Virtual Case File
program, which was supposed to bring the bureau's computer system into the
21st century, after it was criticized as unworkable by the Justice
Department's inspector general and members of Congress.

The inspector general said the bulk of the program's problems were the
fault of the bureau.

Black, Smith and Visner declined requests for interviews. An NSA
spokesman denied repeated requests for comment.

An NSA spokeswoman told The Sun in 2003 that Black sold his SAIC stock
when he returned to the agency in 2000 and recused himself for a year from
"involvement in any matter affecting the financial interests" of the
company.

Varied criteria

The spokeswoman said SAIC, which was selected as the prime contractor for
Trailblazer in 2002, was one of three companies seeking the contract. The
choice, she said, was based on a "formal source selection process" that
looked at technical issues, management, cost and past performance.

SAIC officials declined requests for interviews for this article,
referring questions to the NSA.

In 2003, Mark V. Hughes, then executive vice president of SAIC, told The
Sun that the company hires former government officials not for influence
but for their expertise. "We do a much better job for our customers if we
have people in the company who really know the customers," he said then.

Hughes also said the company is scrupulous about obeying laws designed to
prevent conflicts of interest. "As a government contractor," he said then,
"just one or two violations could cause us to be suspended from government
contracts. That would destroy our company."

Hughes has since left the company.

Jacques Gansler, a former undersecretary of defense who is now vice
president for research at the University of Maryland, said the revolving
door between government agencies and private government contractors has an
upside.

Without former government officials in their ranks, he said, companies
would have a difficult time navigating the labyrinth of the government
procurement process. Before he took his Pentagon job dealing with
acquisitions, Gansler was a senior executive with TASC, a major defense
contractor.