Two Republican members of Congress have called on the Department of Defense's inspector general to investigate the Pentagon's Joint Enterprise Defense Infrastructure (JEDI) commercial cloud contract, which is set to be awarded to one company, could last up to 10 years, and be worth as much as $10bn.
The letter, which the IG office confirmed it is reviewing, highlighted a common complaint - that the contract appears to favor one company, namely Amazon Web Services.
There can only be one
"Of particular concern are the 'gating' or restricting provisions and the structure of the proposed contract, that seem to be tailored to one specific contractor," representatives Steve Womack (R-AR) and Tom Cole (R-OK) wrote in a letter to acting inspector general Glenn Fine.
"An example of one of these provisions is the requirement that the Cloud Service Provider meets the Defense Information Systems Agency Impact Level 6. Currently, this unnecessary requirement, along with many others, can only be met by one specific contractor."
While not named, that one contractor is almost certainly AWS, which is the only company able to meet all the requirements of JEDI.
The congressmen noted that the recently-passed Department of Defense and Labor, Health and Human Services, and Education Appropriations Act of 2019 requires the Secretary of Defense to provide "a detailed description of the Department's strategy to implement enterprise-wide cloud computing," which must include "the strategy to sustain competition and innovation throughout the period of performance of each contract, including defining opportunities for multiple cloud service providers."
A similar provision was included by Congress in the Consolidated Appropriations Act of 2018, with the legislature having "expressed concerns with the Department's acquisition strategy multiple times in both formal and informal meetings. The Department has not provided any adequate explanation as to why they continue to insist on a contract structure that has been widely criticized by Congress and industry," Womack and Cole wrote.
The pair added: "It has come to our attention through media reports that individuals who held, or hold, high ranking positions in the Department have significant connections to the specific contractor. Our current understanding is that these individuals, in direct contrast with the Federal Acquisition Regulation and DoD Ethics Policy, had involvement in the development of the JEDI program."
Womack’s office confirmed to FedScoop that “examples” of those individuals include Sally Donnelly, a former senior adviser to Defense Secretary James Mattis, who had financial ties to AWS through a consulting firm she founded, but has since sold, that did work with the cloud service provider when the $10 billion contract was developed.
The alleged links, which were reported by Vanity Fair and The Daily Caller, may have originated in a 100+ page dossier created by private investigative firm RosettiStarr and sent to Washington reporters earlier this year. In it, the firm noted Donnelly's ties and claimed she helped arrange a meeting last year between Mattis and Amazon CEO Jeff Bezos.
Speaking to NextGov, Donnelly's attorney, Michael Levy, denied the allegations: "While at the Department of Defense, Ms. Donnelly had no role in acquisition or procurement. She played no role, and exercised no influence, in connection with any government contract, including – as the Department of Defense has confirmed repeatedly – the JEDI contract.
"To suggest otherwise not only reflects an absence of even the most rudimentary understanding of the government contracting process but also insults the dedicated career men and women at the Department of Defense who have spent countless hours developing and refining this and hundreds of other contracts with the sole purpose of protecting the safety and security of the United States."
RosettiStarr has declined requests to reveal which person or organization funded its work.
In April, Bloomberg reported that Oracle was leading lobbying efforts against AWS and JEDI, with assistance from Microsoft and IBM. The company was said to be holding regular calls with tech allies, courting press and lobbying lawmakers, defense officials and the White House. Around that time, DCD was invited to a talk on the contract by the Hudson Institute - a think tank located just a few minutes from the White House, and funded by Oracle.
The same month, Oracle Co-CEO Safra Catz met with President Trump over a dinner organized by Peter Thiel, and discussed her views the deal: “I talked to him about what commercial customers are doing in their move to the cloud and what I understand the Pentagon’s plan was to have one cloud,” she told reporters in Tel Aviv (via Reuters).
It is unclear whether lobbying efforts had any sway on Womack and Cole's letter. Federal Election Commission data shows that so far this year, the Oracle America Political Action Committee has donated $1,135 to the Womack for Congress Committee.
Oracle is not alone. This year, IBM has already invested millions in lobbying ($1.45m in the first quarter, $1.6m in the second, and $900,000 in the third). Among the specific lobbying issues raised is "FY19 Defense Appropriations: provisions related to DoD cloud programs, including the Joint Enterprise Defense Infrastructure (JEDI)."