Treasury's IRS awarded $35.6M for software training, with Software AG Government Solutions Inc. as the sole awardee

Contract Overview

Contract Amount: $35,567,937 ($35.6M)

Contractor: Software AG Government Solutions, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2017-11-13

End Date: 2022-12-12

Contract Duration: 1,855 days

Daily Burn Rate: $19.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF:OT:IGF - SOFTWARE AG WEBMETHOD

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20170

State: Virginia Government Spending

Plain-Language Summary

Department of the Treasury obligated $35.6 million to SOFTWARE AG GOVERNMENT SOLUTIONS, INC. for work described as: IGF:OT:IGF - SOFTWARE AG WEBMETHOD Key points: 1. The contract's value of $35.6 million over five years suggests a significant investment in specialized software training. 2. Full and open competition was utilized, indicating a broad market solicitation for these services. 3. The contract type is Firm Fixed Price, which transfers cost risk to the contractor. 4. The duration of 1855 days (approximately 5 years) points to a long-term need for this training. 5. The North American Industry Classification System (NAICS) code 611420 suggests a focus on computer training services. 6. The award was a Delivery Order, implying it was part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar framework.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without knowing the specific software and the scope of training. However, a $35.6 million expenditure over five years for software training indicates a substantial commitment. Comparing this to other government contracts for similar specialized software training would be necessary for a precise value-for-money assessment. The firm fixed-price nature provides cost certainty for the government, but the overall value depends on the effectiveness and breadth of the training delivered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' suggesting that all responsible sources were permitted to submit offers. The data indicates only one award was made, which could mean that while competition was open, only one offer was deemed suitable or competitive enough to win. The level of competition, in terms of the number of bids received, is not explicitly stated but the 'full and open' designation implies an intention to maximize market participation.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the best possible pricing and quality by allowing a wide range of vendors to bid, potentially driving down costs through market forces.

Public Impact

The primary beneficiaries are IRS employees who will receive training on specific software, enhancing their technical skills and operational efficiency. The services delivered are computer training, likely focused on software used for tax administration and processing. The geographic impact is primarily within the IRS, affecting its workforce across various locations where the software is utilized. Workforce implications include upskilling of IRS personnel, potentially leading to improved service delivery and internal process optimization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on the software being trained on makes it difficult to assess the criticality and uniqueness of the training.
The duration of the contract (5 years) could lead to vendor lock-in if the software becomes deeply integrated into IRS workflows.
Without knowing the number of bidders, it's hard to definitively say if 'full and open' competition resulted in optimal pricing.
The 'Delivery Order' nature suggests this might be one of many task orders under a larger contract, making it harder to assess the overall value and competition in isolation.

Positive Signals

The use of 'full and open competition' indicates an effort to leverage the broadest possible market for services.
A Firm Fixed Price contract structure provides budget certainty for the government, protecting against cost overruns.
The contract duration suggests a sustained commitment to developing critical software skills within the IRS workforce.
The award to 'SOFTWARE AG GOVERNMENT SOLUTIONS, INC.' implies a specialized provider with potentially deep expertise in the relevant software.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on computer training. The market for specialized software training is diverse, ranging from large IT consulting firms to niche training providers. Government spending on IT training is substantial, driven by the need to maintain and upgrade complex systems. Comparable spending benchmarks would involve looking at other federal agencies' investments in training for enterprise software solutions, particularly those related to financial management and data processing.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. The primary focus appears to be on securing specialized training services, likely from larger, established vendors capable of providing such expertise, rather than specifically fostering small business participation through this particular award.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Treasury's contracting officers and program managers. The IRS likely has internal audit and compliance functions to monitor performance and ensure adherence to contract terms. Given the nature of IT training, performance metrics related to course completion, user proficiency, and satisfaction would be key oversight indicators. Transparency is generally facilitated through contract databases like FPDS, where basic award information is publicly available.

Related Government Programs

IRS IT Modernization Programs
Federal IT Training and Development Contracts
Software AG Product Support Contracts
Government-wide Acquisition Contracts (GWACs) for IT Services

Risk Flags

Potential for vendor lock-in due to long contract duration.
Uncertainty regarding the number of actual bidders despite 'full and open competition'.
Lack of specific software modules trained on hinders detailed value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $35.6 million to SOFTWARE AG GOVERNMENT SOLUTIONS, INC.. IGF:OT:IGF - SOFTWARE AG WEBMETHOD

Who is the contractor on this award?

The obligated recipient is SOFTWARE AG GOVERNMENT SOLUTIONS, INC..

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $35.6 million.

What is the period of performance?

Start: 2017-11-13. End: 2022-12-12.

What specific Software AG WebMethods modules or functionalities are covered by this training contract?

The provided data does not specify the exact Software AG WebMethods modules or functionalities covered by this training contract. The description 'SOFTWARE AG WEBMETHOD' is a general identifier. To understand the scope, one would need to examine the detailed statement of work (SOW) or contract line item numbers (CLINs) associated with this delivery order. This information is crucial for assessing the relevance and criticality of the training to the IRS's operations and for comparing its value against training for other specific software platforms.

How does the $35.6 million contract value compare to historical IRS spending on Software AG WebMethods training?

The provided data indicates a single award of $35,567,937 to SOFTWARE AG GOVERNMENT SOLUTIONS, INC. for 'IGF:OT:IGF - SOFTWARE AG WEBMETHOD' from 2017-11-13 to 2022-12-12. Without historical data on previous training contracts specifically for Software AG WebMethods at the IRS, a direct comparison is not possible. Analyzing past spending patterns would require searching federal procurement databases for similar contracts awarded to this vendor or for this specific software over a longer period. This would help determine if the current award represents an increase, decrease, or consistent level of investment in this area.

What is the assessed risk level associated with this contract, considering the contractor's performance and the nature of the services?

The provided data does not include specific performance ratings or risk assessments for this contract. However, general risk indicators can be inferred. The contract type (Firm Fixed Price) mitigates cost overrun risk for the government. The duration (over 5 years) introduces potential risks related to technology obsolescence or changes in IRS requirements. The fact that it was awarded under 'full and open competition' suggests an effort to mitigate risks associated with sole-sourcing. A comprehensive risk assessment would require reviewing past performance evaluations, any contract modifications, and the criticality of the software to IRS operations.

What are the key performance indicators (KPIs) used to measure the success of this software training contract?

The provided summary data does not detail the specific Key Performance Indicators (KPIs) for this contract. Typically, for training contracts, KPIs would focus on aspects such as the number of employees trained, completion rates, post-training assessment scores, user proficiency levels, and potentially improvements in task efficiency or error reduction attributed to the training. Client satisfaction surveys and feedback from trainees and their supervisors are also common metrics. The IRS contracting officer and program managers would be responsible for defining and monitoring these KPIs to ensure the training delivers the intended value.

How many bids were received for this contract, and what does this imply about the competitiveness of the market for Software AG WebMethods training?

The provided data states the contract was awarded under 'FULL AND OPEN COMPETITION' and lists one awardee ('SOFTWARE AG GOVERNMENT SOLUTIONS, INC.'). However, it does not explicitly state the total number of bids received. 'Full and open competition' means all responsible sources were allowed to compete, but it doesn't guarantee a high number of bids. If only one bid was received, it could indicate a lack of market interest, limited qualified vendors, or that other potential bidders chose not to submit offers for various reasons. This could potentially limit price discovery and negotiation leverage for the government.

Industry Classification

NAICS: Educational Services › Business Schools and Computer and Management Training › Computer Training

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Software AG

Address: 12950 WORLDGATE DR, STE 300, HERNDON, VA, 20170

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $35,567,937

Exercised Options: $35,567,937

Current Obligation: $35,567,937

Actual Outlays: $11,471,784

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS35F039BA

IDV Type: FSS

Timeline