How does a $2 million project end up costing the government $124 million? Just ask the Department of Homeland Security

June 25, 2007
How does a $2 million project end up costing the government $124 million? Just ask the Department of Homeland Security

Payments to the firm, one of the country's biggest government contractors, soared by millions of dollars a month, the Post says, reaching $30 million, or 15 times the contract's original value, by December 2004. At that point, DHS lawyers warned that the deal had gone "grossly beyond" estimates and advised the department to end the contract and allow other companies to bid for the work.

But it was more than a year before any competitive bidding took place. In the meantime, payments to Booz Allen more than doubled again, thanks to another no-bid deal, to $73 million. Finally, in spring 2006, DHS broke the work into five separate contracts, worth an additional $50 million, and solicited bids.