Treasury's IRS Awards $4.5M Mailroom Services Contract to ServiceSource Inc. with Limited Competition

Contract Overview

Contract Amount: $4,507,977 ($4.5M)

Contractor: Servicesource Inc

Awarding Agency: Department of the Treasury

Start Date: 2026-01-01

End Date: 2026-12-31

Contract Duration: 364 days

Daily Burn Rate: $12.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: NATIONWIDE CONTRACTED MAILROOM SERVICES POP: JANUARY 01, 2026 - DECEMBER 31, 2030

Place of Performance

Location: OAKTON, FAIRFAX County, VIRGINIA, 22124

State: Virginia Government Spending

Plain-Language Summary

Department of the Treasury obligated $4.5 million to SERVICESOURCE INC for work described as: NATIONWIDE CONTRACTED MAILROOM SERVICES POP: JANUARY 01, 2026 - DECEMBER 31, 2030 Key points: 1. The contract is for nationwide contracted mailroom services, valued at $4.5 million. 2. ServiceSource Inc. is the sole awardee, indicating a lack of broad competition. 3. The contract type is Firm Fixed Price, providing cost certainty. 4. The primary risk lies in the limited competition, potentially impacting price. 5. The sector is Business Support Services, with a PSC code of 561499.

Value Assessment

Rating: fair

The contract value of $4.5 million for a 1-year mailroom service contract appears reasonable given the scope. However, without specific details on the services provided and benchmarks for similar nationwide contracts, a precise valuation is difficult. The lack of competition makes direct price comparison challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract is listed as 'NOT AVAILABLE FOR COMPETITION,' suggesting a sole-source or limited competition award. This limits price discovery and may not yield the best value for taxpayers. The specific justification for this limitation is not provided.

Taxpayer Impact: The limited competition raises concerns about whether the government secured the most cost-effective solution, potentially leading to higher taxpayer costs than if a fully competitive process had been employed.

Public Impact

Taxpayers may be paying more than necessary due to the lack of competitive bidding. The IRS relies on this service for essential mailroom operations, impacting its efficiency. The contract's duration of one year limits long-term strategic planning but allows for re-evaluation. ServiceSource Inc. will manage mailroom operations across various IRS locations nationwide.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition
Lack of justification for limited competition
Potential for overpayment

Positive Signals

Firm Fixed Price contract type
Clear contract duration
Single, established vendor

Sector Analysis

This contract falls under Business Support Services, specifically mailroom management. Benchmarks for this sector can vary widely based on the scale and complexity of services. A $4.5 million contract for a year of nationwide mailroom services suggests a significant operational footprint.

Small Business Impact

The data indicates that small business participation (sb) is marked as false (false). This suggests that small businesses were not involved in this specific contract award, either as prime contractors or potentially as subcontractors.

Oversight & Accountability

The limited competition aspect warrants further oversight to ensure the justification for not seeking broader bids is sound and that the pricing remains fair. Accountability for service delivery and cost management rests with the IRS and ServiceSource Inc.

Related Government Programs

All Other Business Support Services
Department of the Treasury Contracting
Internal Revenue Service Programs

Risk Flags

Limited competition raises concerns about best value.
Lack of transparency regarding the justification for limited competition.
Potential for inflated costs due to lack of competitive pressure.
No clear indication of small business subcontracting opportunities.
Absence of specific performance metrics in the provided data.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $4.5 million to SERVICESOURCE INC. NATIONWIDE CONTRACTED MAILROOM SERVICES POP: JANUARY 01, 2026 - DECEMBER 31, 2030

Who is the contractor on this award?

The obligated recipient is SERVICESOURCE 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 $4.5 million.

What is the period of performance?

Start: 2026-01-01. End: 2026-12-31.

What is the specific justification for awarding this contract on a limited competition basis, and what steps were taken to ensure fair pricing?

The provided data states the contract is 'NOT AVAILABLE FOR COMPETITION,' but lacks the specific justification. Typically, this requires a detailed explanation, such as the existence of a unique capability or urgent need that only one vendor can meet. Without this, it's difficult to assess if fair pricing was achieved through adequate negotiation or if the government accepted a price without sufficient market validation.

How does the per-unit cost of mailroom services under this contract compare to industry benchmarks for similar-sized operations?

A direct per-unit cost benchmark is not available without more granular data on the services rendered (e.g., cost per piece processed, cost per pound handled, cost per location managed). The total contract value of $4.5 million for one year is a high-level figure. To assess value, a detailed breakdown of service components and their associated costs would be needed for comparison against industry standards for nationwide mailroom operations.

What are the key performance indicators (KPIs) for this contract, and how will ServiceSource Inc.'s performance be measured to ensure effectiveness?

The provided data does not specify the Key Performance Indicators (KPIs) or the measurement mechanisms for this contract. Effective oversight would require clearly defined metrics related to mail processing speed, accuracy, security, cost control, and customer satisfaction. The IRS should have a robust performance management plan in place to track ServiceSource Inc.'s adherence to these KPIs and ensure the mailroom services are delivered effectively.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Business Support Services › All Other Business Support Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › ADMINISTRATIVE SUPPORT SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 10467 WHITE GRANITE DR, OAKTON, VA, 22124

Business Categories: AbilityOne Program Participant, Category Business, Corporate Entity Tax Exempt, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $93,751,116

Exercised Options: $18,139,336

Current Obligation: $4,507,977

Actual Outlays: $1,488,129

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline