Treasury's IRS Awards $225.6M MIDS Contract to Peraton for IT Infrastructure

Contract Overview

Contract Amount: $225,616,426 ($225.6M)

Contractor: Peraton Enterprise Solutions LLC

Awarding Agency: Department of the Treasury

Start Date: 2021-05-04

End Date: 2026-05-03

Contract Duration: 1,825 days

Daily Burn Rate: $123.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: MANAGED INFRASTRUCTURE DATA SERVICE (MIDS) COVID-19

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20170

State: Virginia Government Spending

Plain-Language Summary

Department of the Treasury obligated $225.6 million to PERATON ENTERPRISE SOLUTIONS LLC for work described as: MANAGED INFRASTRUCTURE DATA SERVICE (MIDS) COVID-19 Key points: 1. Significant award of $225.6M for managed infrastructure data services. 2. Peraton Enterprise Solutions LLC is the sole awardee. 3. Contract duration is 5 years, ending May 2026. 4. The award falls under the IT sector, specifically electronic computer manufacturing. 5. This contract aims to support IRS operations through data services.

Value Assessment

Rating: good

The contract value of $225.6M over 5 years suggests a substantial investment in IT infrastructure. Benchmarking against similar managed infrastructure contracts would be necessary for a precise pricing assessment, but the firm-fixed-price structure indicates cost certainty for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This competitive process is expected to drive favorable pricing and ensure the government receives best value.

Taxpayer Impact: The competitive award process is designed to ensure taxpayer funds are used efficiently for essential IT services.

Public Impact

Ensures continued operation of critical IRS data infrastructure. Supports tax processing and taxpayer services through reliable IT. Potential impact on taxpayer data security and privacy. Contributes to the modernization of government IT systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific performance metrics in provided data.
Potential vendor lock-in after contract completion.
Dependence on a single vendor for critical data services.

Positive Signals

Awarded through full and open competition.
Firm-fixed-price contract provides cost predictability.
Long-term contract ensures stable service delivery.

Sector Analysis

This contract falls within the Information Technology sector, specifically related to electronic computer manufacturing and managed infrastructure services. Spending in this area is critical for government operations, with benchmarks varying widely based on the scope and complexity of the services provided.

Small Business Impact

The provided data does not indicate any specific set-asides for small businesses. Further analysis would be needed to determine if small businesses were involved as subcontractors or if opportunities were missed.

Oversight & Accountability

The award was made by the Department of the Treasury's Internal Revenue Service. Standard government oversight processes for contract performance and financial management are expected to be in place.

Related Government Programs

Electronic Computer Manufacturing
Department of the Treasury Contracting
Internal Revenue Service Programs

Risk Flags

Potential for vendor lock-in.
Dependence on a single provider for critical infrastructure.
Lack of explicit small business participation.
Need for detailed performance metrics review.
Cybersecurity risks associated with managed data services.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $225.6 million to PERATON ENTERPRISE SOLUTIONS LLC. MANAGED INFRASTRUCTURE DATA SERVICE (MIDS) COVID-19

Who is the contractor on this award?

The obligated recipient is PERATON ENTERPRISE SOLUTIONS LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $225.6 million.

What is the period of performance?

Start: 2021-05-04. End: 2026-05-03.

What specific performance metrics are included in the contract to ensure service quality and value for money?

The provided data does not detail specific performance metrics. A thorough review of the contract document is necessary to ascertain the Service Level Agreements (SLAs) and Key Performance Indicators (KPIs) established. These metrics are crucial for evaluating the vendor's performance, ensuring the IRS receives the expected value, and holding Peraton accountable for delivering high-quality managed infrastructure data services.

How does the pricing compare to industry benchmarks for similar managed infrastructure data services, considering the firm-fixed-price structure?

While the firm-fixed-price structure offers cost certainty, a direct comparison to industry benchmarks requires detailed knowledge of the specific services rendered. Factors like data volume, security requirements, and uptime guarantees influence pricing. Without these specifics, it's difficult to definitively assess if $225.6M represents optimal value. Further analysis of the contract's scope of work against market rates is recommended.

What is the potential impact on IRS operational continuity and taxpayer services if Peraton fails to meet contractual obligations?

Failure to meet obligations could significantly disrupt IRS operations, potentially impacting tax processing, data management, and taxpayer services. The contract's duration and critical nature necessitate robust contingency plans and clear remedies for non-performance. The IRS likely has clauses for service level failures, but the extent of disruption depends on the severity of the breach and the effectiveness of mitigation strategies.

Industry Classification

NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - DATA CENTER

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Veritas Capital Fund Management, L.L.C.

Address: 15050 CONFERENCE CENTER DR, CHANTILLY, VA, 20151

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $418,633,079

Exercised Options: $331,384,648

Current Obligation: $225,616,426

Actual Outlays: $218,479,516

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $371,867

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: HHSN316201500009W

IDV Type: GWAC

Timeline