SSA's Acceptance Testing of a Mass Storage System for Computerized Data Was Adequate

In response to a congressional request, GAO provided information on a contract which the Social Security Administration (SSA) awarded for a mass storage system for computerized data, including information on the acceptance testing procedures used and whether mandatory requirements were waived.

GAO found that, during the procurement process, SSA waived one specification that it no longer needed. However, this waiver was within the boundaries of federal procurement regulations. In addition, acceptance testing of the awardee's equipment was delayed for 4 months while both parties worked to resolve a disagreement over the interpretation of a contract clause. After the contract award, SSA discovered that the awardee's system failed to comply with a solicitation specification, but the awardee argued that the specifications did not require the disputed feature. Ultimately, the awardee installed additional equipment to meet the requirement, reserving the right to bill SSA for the equipment, while SSA accepted the proposal subject to the conditions that the additional equipment would pass acceptance testing and would be provided at no additional cost to the government. After delivery, acceptance testing began. GAO believed that the testing provided reasonable assurance that the awardee's system met SSA contract requirements. The awardee has filed a damage claim against SSA for compensation for the extra equipment which it provided, and SSA has assessed the awardee with liquidated damages for the 121-day installation delay.