Congress just passed a year-end appropriations bill for the Department of Defense and it contained a funding provision that will help save taxpayers money. On September 28, 2018, President Donald Trump signed into law an appropriations bill (H.R. 6157) that prevents the cloud computing contract for Defense to be awarded to a single provider. Reports indicate that Amazon was at the top of the list to get this contract because of blatant cronyism.
The law is extraordinary because it specifically prevents the Department of Defense from giving a contract to Amazon. The cloud-computing proposal is over one thousand pages long and “contains a host of technical stipulations that only Amazon can meet,” according to Vanity Fair.
Specifically, the contract stipulates that a company already has to generate $2 billion a year in commercial revenues from cloud computing and this narrows the field to Amazon to the exclusion of others. The contract is expected to be in excess of $10 billion, therefore it is one of the most sought-after contracts by tech companies in the history of federal contracting.
The provision of the law states the following:
“SEC. 8137. None of the funds appropriated or otherwise made available by this or any other Act may be obligated or expended by the Department of Defense to migrate data and applications to the proposed Joint Enterprise Defense Infrastructure or the Defense Enterprise Office Solutions cloud computing services until a period of 90 days has elapsed following the date on which the Secretary of Defense submits to the congressional defense committees—
(1) a proposed plan to establish a budget accounting system that provides transparency across the Department, including all military Services and Defense Agencies, for funds requested and expended for all cloud computing services procured by the Department and funds requested and expended to migrate to a cloud computing environment; and
(2) a detailed description of the Department’s strategy to implement enterprise-wide cloud computing, including the goals and acquisition strategies for all proposed enterprise-wide cloud computing service procurements; the strategy to sustain competition and innovation throughout the period of performance of each contract, including defining opportunities for multiple cloud service providers and insertion of new technologies; and an assessment of potential threats and security vulnerabilities of the proposed cloud computing strategy, and plans to mitigate such risks.”
Converted from federal contracting lingo into plain English, the Pentagon can’t give Amazon the contract until the company proposes a plan for transparency in spending taxpayer dollars and provides a description of the strategy to implement on how the winning contractor(s) will get the job done.
Simply put, the perceived problem is that this contract was rigged for Amazon with no real plan to implement the technology.
Congress has done an excellent job here to restrict bureaucrats’ power to dole out billion dollar contracts with little accountability to taxpayers. All signs point to Amazon rigging the system with a team of lobbyists and influence peddlers helping to have the contract written for Amazon’s specifications. The contract reads as if Amazon’s Jeff Bezos wrote it himself.
Amazon has become one of the biggest companies on the earth in a very short period of time, yet they should not be allowed a monopoly on government contracts because of their size. The best contractor should get the contract on merit alone. The new law signed by President Trump should help make sure that taxpayers are provided some transparency and protection from cronyism.