ACS wins 5-year state telecommunications contract

State officials have chosen Alaska Communications Systems Group Inc. to provide state government telecommunications services in a five-year, $92.5 million contract.

The Department of Administration issued a notice of intent to award the contract to Anchorage-based ACS Nov. 15.

The announcement started the clock on a 10-day period in which protests could be filed.

The earliest a contract with Anchorage-based ACS could be signed would be Nov. 26, said Administration Department Commissioner Jim Duncan. "We hope to be able to sign a contract as soon as possible," he said.

However, sealing the deal could depend on comments filed during the 10-day period, he said.

ACS could take over the state telecommunications services as soon as possible after signing the contract or perhaps Jan. 1, Duncan said.

State officials said the $18.5 million annual contract will upgrade telecommunications technology including video conferencing improvements.

"It really does allow the state of Alaska to access state-of-the-art technology much more quickly than we might have otherwise," Duncan said.

The new contract aims to streamline state telecommunications services. The state issued a request for proposals in August 2000, and bids were due that December.

After issuing the RFP, state and union officials negotiated an agreement signed in late August 2000 to ensure the stability of jobs for state workers affected by the new contract. The 26 employees affected will be able to choose whether to stay in state employment or accept a job offer from ACS, Duncan said.

Department of Administration and ACS representatives have met with the state employees, he said. They have 30 days after the contract is signed to choose to accept an ACS job or continue working for the state, Duncan said.

The original request estimated 42 state employees would be laid off as a result of the new contract. Also, initial figures listed the contract value at $26 million annually. Duncan said the change results from a decision that the state would continue to provide some services.

As a result of a vendor taking on the telecommunications services, Duncan said the state expects to save $12.9 million in operating costs over the next five years.

Tom Jensen, director of public affairs for ACS, said Nov. 15, "It would be very inappropriate to talk at this time" during the comment period.

Last December representatives from major Alaska telecommunications players AT&T Alascom, Alaska Communications Systems and General Communication Inc. told the Journal they submitted bids.

GCI public affairs manager David Morris said company employees were reviewing the contract award documents following the announcement of intent to award the contract to ACS.

"GCI is disappointed in losing the bid," he said. "We felt we made a very aggressive bid for the service."

However, GCI probably won’t see much of an impact without the contract, he said. "The margins were so thin, and it will not have much impact as far as operating costs go," he said.

GCI does not plan to lay off any employees in relation to the state contract.

Officials from AT&T Alascom were considering their next move.

"We are disappointed," said Meg Sudduth, the company’s external affairs manager. "We are certainly going to review our options and consider participating in the comment session."

ACS plans to provide $29 million in capital investments as part of the contract.

Key elements in the contract include improved broadband services to state offices in urban and rural Alaska and reduction of the state’s long-distance calling costs by allowing calls between state offices to be local calls. With final approval of the contract, ACS would provide improved cellular and satellite phone service.

The company also would maintain the state’s existing microwave and satellite earth stations, which are used for statewide emergency communications. The state has 231 such stations that also broadcast rural television and public radio, Duncan said.

Video conferencing was another major component of the contract, Duncan said.

As part of the contract, capital investment dedicated to video conferencing would be installed at 14 sites initially and several others later. The contract proposed to spend $1.4 million in five years on video conferencing services.

"I would hope that video conference sites would be up and operating by midlegislative session," Duncan said.

The largest portion of capital investment, nearly $17.6 million over five years, is scheduled to be dedicated to wired telephony services. In the first year the contract vendor would spend $16.6 million to replace existing phones with new ones capable of handling voice, data and video services. Other improvements would include installing new data cabinets, routers, cabling and switches. The contract also calls for a centralized voice mail system.

Other capital investments would provide equipment and labor to expand a paging system to 10 additional sites.

11/25/2001 - 8:00pm