Peraton Inc. awarded $9.5M for IT services, with a 2-year duration and full and open competition
Contract Overview
Contract Amount: $9,557,224 ($9.6M)
Contractor: Peraton Inc.
Awarding Agency: Department of the Treasury
Start Date: 2021-03-12
End Date: 2025-03-11
Contract Duration: 1,460 days
Daily Burn Rate: $6.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: DATA ANALYTICS
Place of Performance
Location: LANHAM, PRINCE GEORGES County, MARYLAND, 20706
State: Maryland Government Spending
Plain-Language Summary
Department of the Treasury obligated $9.6 million to PERATON INC. for work described as: DATA ANALYTICS Key points: 1. Value for money appears fair given the IT services scope and contract type. 2. Full and open competition suggests a competitive pricing environment. 3. Risk indicators are moderate, with a cost-plus-fixed-fee structure requiring careful oversight. 4. Performance context is within IT systems design, a common government need. 5. Sector positioning is within IT services, a significant area of federal spending.
Value Assessment
Rating: fair
The contract value of $9.56 million for a two-year period for computer systems design services is within a reasonable range for federal IT contracts. The cost-plus-fixed-fee (CPFF) structure, while common, necessitates close monitoring to ensure costs remain controlled and the fixed fee is justified by the scope of work. Benchmarking against similar IT services contracts would provide a clearer picture of value, but the initial assessment suggests a fair, albeit not exceptional, price point.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The presence of two bids suggests a moderate level of competition for this specific award. While two bidders is better than a sole-source award, a higher number of competitors typically leads to more aggressive pricing and a wider range of innovative solutions.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a more competitive environment, which can lead to lower prices and better quality services. The presence of two bidders suggests some level of price discovery, but taxpayers may not be realizing the full potential savings that could be achieved with a larger pool of interested contractors.
Public Impact
The Department of the Treasury, specifically the Internal Revenue Service, benefits from these IT services. Services delivered include computer systems design, crucial for agency operations. The geographic impact is primarily in Maryland, where the contractor is located. Workforce implications include employment for IT professionals involved in systems design and implementation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts can incentivize cost overruns if not managed tightly.
- Limited competition (2 bidders) may mean less aggressive pricing than a more crowded field.
- The fixed fee component needs clear definition and justification to ensure fair value.
Positive Signals
- Awarded under full and open competition, maximizing potential bidder pool.
- Contract duration of two years provides stability for service delivery.
- The contractor, Peraton Inc., is an established entity in the federal contracting space.
Sector Analysis
The federal IT services market is vast and highly competitive, with agencies consistently seeking support for systems design, development, and maintenance. This contract falls within the Computer Systems Design Services category (NAICS 541512), a segment that consistently sees significant federal investment. Comparable spending benchmarks for similar IT services contracts vary widely based on scope, complexity, and agency, but this $9.56 million award over two years is a moderate-sized engagement within this sector.
Small Business Impact
This contract was not set aside for small businesses, and the data does not indicate any specific subcontracting requirements for small businesses. As a result, the direct impact on the small business ecosystem for this particular award is likely minimal. However, larger prime contractors like Peraton Inc. often engage small businesses for specialized support, which could indirectly benefit them.
Oversight & Accountability
Oversight for this contract would typically fall under the contracting officer and the relevant program managers within the IRS. The cost-plus-fixed-fee structure necessitates robust financial oversight to monitor expenditures and ensure the fixed fee remains appropriate for the work performed. Transparency is generally maintained through contract reporting mechanisms, and while no specific Inspector General jurisdiction is mentioned, the Treasury OIG would have oversight authority over potential fraud, waste, or abuse.
Related Government Programs
- IT Systems Modernization
- Computer Systems Design Services
- Federal IT Services
- IRS Technology Modernization
Risk Flags
- Cost-plus-fixed-fee contract type requires diligent oversight to manage costs.
- Limited number of bidders (2) may indicate potential for better pricing with more competition.
Tags
it-services, computer-systems-design, department-of-the-treasury, internal-revenue-service, peraton-inc, cost-plus-fixed-fee, full-and-open-competition, delivery-order, maryland, moderate-value
Frequently Asked Questions
What is this federal contract paying for?
Department of the Treasury awarded $9.6 million to PERATON INC.. DATA ANALYTICS
Who is the contractor on this award?
The obligated recipient is PERATON 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 $9.6 million.
What is the period of performance?
Start: 2021-03-12. End: 2025-03-11.
What is Peraton Inc.'s track record with the federal government, particularly in IT services?
Peraton Inc. has a significant track record as a federal contractor, often securing large and complex IT and mission support contracts across various agencies. Their history includes work in areas such as enterprise IT, cybersecurity, and mission systems. While specific performance details for every contract are not publicly available, their continued success in winning competitive bids suggests a generally positive performance record and capability to meet government requirements. It is advisable to review specific contract performance reports (e.g., CPARS) for a more granular understanding of their past performance on similar IT services engagements.
How does the $9.56 million value compare to similar IT services contracts awarded by the IRS or Treasury?
The $9.56 million value for a two-year computer systems design services contract is a moderate-sized award within the federal IT landscape. The IRS and Treasury, like many large federal agencies, award a wide spectrum of IT contracts ranging from small, specialized task orders to multi-billion dollar enterprise-wide solutions. For a contract focused on systems design over a two-year period, this value appears reasonable, especially considering it was awarded under full and open competition. However, without specific details on the scope and complexity of the systems being designed, a precise comparison is challenging. Benchmarking against contracts with similar NAICS codes (541512) and durations would provide a more accurate assessment of its relative value.
What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for IT services?
The primary risk with a Cost Plus Fixed Fee (CPFF) contract is the potential for cost overruns. While the contractor is reimbursed for allowable costs, the fixed fee provides a guaranteed profit margin regardless of the final cost. This can disincentivize the contractor from aggressively controlling costs, as higher costs (within allowable limits) do not reduce their profit. For the government, the risk is paying more than necessary if the contractor is not efficient. Effective oversight, detailed cost tracking, and clear performance metrics are crucial to mitigate these risks and ensure the government receives good value. The fixed fee itself must also be carefully negotiated to reflect the level of risk and effort involved.
How effective is full and open competition in ensuring competitive pricing for IT services?
Full and open competition is generally the most effective method for ensuring competitive pricing for IT services. By allowing all responsible sources to bid, it maximizes the potential for multiple offers, which drives down prices through market forces. The more bidders there are, the greater the pressure on each contractor to offer competitive rates and innovative solutions to win the contract. While this contract had two bidders, which is a form of competition, a larger number of bidders would typically yield even more favorable pricing outcomes for the government and, by extension, the taxpayer. The effectiveness is also dependent on the clarity of the solicitation and the evaluation criteria.
What is the historical spending trend for Computer Systems Design Services (NAICS 541512) within the Department of the Treasury?
Historical spending on Computer Systems Design Services (NAICS 541512) within the Department of the Treasury has generally trended upwards over the past decade, mirroring the broader federal government's increasing reliance on IT for operational efficiency and service delivery. Agencies like the IRS, which fall under Treasury, consistently invest in modernizing their systems, developing new applications, and maintaining existing infrastructure. While specific year-over-year figures fluctuate based on agency priorities and budget allocations, the overall demand for these services remains robust. This sustained spending indicates a consistent need for external expertise in designing and implementing complex IT systems to support the Treasury's diverse mission.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - IT MANAGEMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 2
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 12975 WORLDGATE DR STE 7322, HERNDON, VA, 20170
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $13,768,990
Exercised Options: $11,117,904
Current Obligation: $9,557,224
Actual Outlays: $9,464,234
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: 47QTCK18D0011
IDV Type: GWAC
Timeline
Start Date: 2021-03-12
Current End Date: 2025-03-11
Potential End Date: 2026-03-11 14:39:30
Last Modified: 2026-02-11
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