Treasury's IRS spent $11M on EZ Pass toll services, a purchase order not competed

Contract Overview

Contract Amount: $11,047 ($11.0K)

Contractor: Massachusetts Dept of Transportation

Awarding Agency: Department of the Treasury

Start Date: 2022-10-01

End Date: 2023-09-30

Contract Duration: 364 days

Daily Burn Rate: $30/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: BOSTON DISTRICT EZ PASS TOLL

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20224

State: District of Columbia Government Spending

Plain-Language Summary

Department of the Treasury obligated $11,046.65 to MASSACHUSETTS DEPT OF TRANSPORTATION for work described as: BOSTON DISTRICT EZ PASS TOLL Key points: 1. The contract was awarded as a purchase order, indicating a potentially less formal procurement process. 2. The fixed-price nature of the contract provides cost certainty for the government. 3. The duration of the contract is one year, suggesting a need for ongoing services. 4. The service is categorized under Regulation and Administration of Transportation Programs. 5. The contract was awarded to a single vendor without competition, raising questions about price discovery.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without comparable data for EZ Pass toll services procured by federal agencies. The $11 million expenditure for a one-year duration, covering toll collection and administration, appears substantial. However, without details on the volume of transactions or the specific services rendered, a definitive value-for-money assessment is difficult. The lack of competition further complicates the assessment, as it prevents direct comparison with market prices achieved through competitive bidding.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a purchase order under a sole-source or not-competed basis. This means that the Massachusetts Department of Transportation was likely the only vendor considered or available for this specific service. The absence of a competitive bidding process limits the government's ability to explore alternative solutions or secure the most favorable pricing through market forces.

Taxpayer Impact: Taxpayers may have paid a higher price due to the lack of competition. Without a bidding process, there is no assurance that the selected vendor offered the best possible value or that the price reflects prevailing market rates.

Public Impact

Federal employees and government vehicles utilizing toll roads managed by the Massachusetts Department of Transportation benefit from this service. The contract facilitates the smooth and efficient administration of toll payments for government travel. The geographic impact is primarily within the District of Columbia, where the contract is managed. There are no direct workforce implications as this is a service contract for toll management.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated costs for taxpayers.
Absence of a formal competitive process limits transparency in vendor selection.
The specific services included in the $11 million expenditure are not detailed, hindering performance evaluation.

Positive Signals

The firm fixed-price contract provides budget certainty for the IRS.
The contract duration of one year allows for regular review and potential re-competition.
The service supports essential government operations by facilitating travel.

Sector Analysis

The procurement falls under the broader category of transportation services and administrative support. While not a direct IT or defense contract, it represents a necessary operational expense for agencies that require travel across tolled infrastructure. Comparable spending benchmarks are difficult to establish without more specific details on the scope of services and transaction volumes, but federal agencies do spend significant amounts on travel-related expenses and administrative services.

Small Business Impact

This contract does not appear to involve small business set-asides or significant subcontracting opportunities for small businesses, as it was procured directly from the Massachusetts Department of Transportation for toll services.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers within the Internal Revenue Service (IRS) and the Department of the Treasury. Accountability measures would be tied to the terms and conditions of the purchase order, including service delivery and payment. Transparency is limited due to the sole-source nature of the award.

Related Government Programs

Government Travel Services
Transportation Infrastructure Support
Administrative Services Contracts

Risk Flags

Lack of Competition
Potential for Overpricing
Limited Transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $11,046.65 to MASSACHUSETTS DEPT OF TRANSPORTATION. BOSTON DISTRICT EZ PASS TOLL

Who is the contractor on this award?

The obligated recipient is MASSACHUSETTS DEPT OF TRANSPORTATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $11,046.65.

What is the period of performance?

Start: 2022-10-01. End: 2023-09-30.

What specific services are covered under the $11 million expenditure for EZ Pass toll services?

The provided data indicates the contract is for 'BOSTON DISTRICT EZ PASS TOLL' and falls under 'Regulation and Administration of Transportation Programs.' However, the precise breakdown of services included in the $11 million expenditure is not detailed. This likely encompasses the administration of toll payments, potential transponder management, and reporting related to the use of EZ Pass by federal vehicles or employees within the Boston district. Without a more granular description of the statement of work, it is difficult to ascertain the exact scope and value of each service component.

Why was this contract not competed, and what is the justification for a sole-source award?

The data explicitly states the contract type as 'NOT COMPETED,' implying a sole-source or limited competition award. The justification for not competing this contract is not provided in the given data. Typically, sole-source awards require a documented justification, such as the unique capability of the vendor, an urgent need, or that only one responsible source exists. Given that EZ Pass is a regional tolling system, it's possible the Massachusetts Department of Transportation is the sole entity capable of administering these specific toll services for federal entities operating within its jurisdiction, or that a specific partnership agreement was in place.

How does the $11 million expenditure compare to historical federal spending on similar toll services?

Direct historical comparisons for this specific type of federal expenditure on EZ Pass toll services are not readily available from the provided data. Federal agencies do incur costs for toll usage as part of travel expenses, but these are often aggregated under broader travel or transportation budgets. The $11 million figure represents a significant, consolidated expenditure for toll administration and usage. Without knowing the volume of tolls covered or the specific administrative functions performed, it's difficult to benchmark this against other federal contracts or historical spending patterns for similar services, especially given the sole-source nature of this award.

What are the potential risks associated with awarding a contract of this magnitude without competition?

The primary risk associated with awarding a contract of this magnitude without competition is the potential for overpayment and a lack of optimal value for taxpayer money. Without competitive pressure, the vendor may not be incentivized to offer the lowest possible price or the most efficient service. There's also a risk that alternative, potentially more cost-effective solutions or vendors are overlooked. Furthermore, the lack of transparency in the selection process can raise concerns about fairness and the best use of government funds. This can also set a precedent for future procurements if not properly justified.

What is the expected performance standard or outcome for this contract?

The expected performance standards for this contract are not explicitly detailed in the provided data. However, as a 'Regulation and Administration of Transportation Programs' contract for EZ Pass tolls, the core expectation would be the accurate and efficient processing of toll payments for authorized federal users. This includes ensuring proper account management, timely reporting of usage and costs, and potentially providing support for federal employees or vehicles utilizing the tolled infrastructure. The 'FIRM FIXED PRICE' contract type suggests that the vendor is responsible for delivering these services within the agreed-upon budget, regardless of the actual volume of tolls incurred, up to the contract's value.

Industry Classification

NAICS: Public Administration › Administration of Economic Programs › Regulation and Administration of Transportation Programs

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › OTHER TRANSPORT, TRAVEL, RELOCAT SV

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 10 PARK PLZ, BOSTON, MA, 02116

Business Categories: U.S. Government Authorities, Category Business, Government, U.S. Local Government, U.S. National Government, Not Designated a Small Business, U.S. Regional/State Government

Financial Breakdown

Contract Ceiling: $11,047

Exercised Options: $11,047

Current Obligation: $11,047

Actual Outlays: $11,047

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline