VA awards Deloitte $30.6M for BARS support, raising questions on value and competition

Contract Overview

Contract Amount: $30,664,766 ($30.7M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-03-29

End Date: 2025-08-06

Contract Duration: 861 days

Daily Burn Rate: $35.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: TASK ORDER FOR BARS SUPPORT SERVICES | 101

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20006

State: District of Columbia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $30.7 million to DELOITTE CONSULTING LLP for work described as: TASK ORDER FOR BARS SUPPORT SERVICES | 101 Key points: 1. Contract value appears high relative to duration, suggesting potential for cost efficiencies. 2. Full and open competition was utilized, but the number of bids warrants scrutiny. 3. Risk indicators are moderate, with a focus on performance management and timely delivery. 4. This contract supports administrative management, a common but critical function for agency operations. 5. The IT consulting sector sees significant investment, with this contract representing a small fraction of overall spending.

Value Assessment

Rating: fair

The contract's total value of $30.6 million over approximately 2.4 years (861 days) averages to roughly $1.06 million per month. Benchmarking against similar administrative management consulting contracts is challenging without more specific service details. However, the duration and scope suggest a need for careful cost management to ensure value for money. The firm fixed-price nature provides cost certainty, but the overall price point warrants comparison with industry standards for comparable services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. However, with only 5 bids received, the level of competition may not have been as robust as ideal for driving the lowest possible prices. A higher number of bidders typically leads to more competitive pricing and a wider range of innovative solutions. The VA should ensure the solicitation process was designed to attract a broad base of qualified offerors.

Taxpayer Impact: While full and open competition is a positive signal for taxpayers, the limited number of bids suggests that the price may not have been driven down as aggressively as it could have been with more robust competition.

Public Impact

The Department of Veterans Affairs (VA) is the primary beneficiary, receiving support for its Business Activity Reporting System (BARS). Services delivered include administrative management and general management consulting, crucial for efficient agency operations. The contract's impact is primarily concentrated within the District of Columbia, where the VA's central administration is located. Workforce implications are likely internal to Deloitte, with potential for specialized consultants to be assigned to this task order.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if scope creep occurs within the fixed-price contract.
Reliance on a single contractor for critical administrative support could pose continuity risks.
Ensuring adequate performance monitoring to guarantee service quality and value.

Positive Signals

Awarded under full and open competition, promoting a fair marketplace.
Firm fixed-price contract provides cost certainty for the VA.
Deloitte Consulting LLP is a large, established firm with significant federal contracting experience.

Sector Analysis

Administrative Management and General Management Consulting Services (NAICS 541611) is a significant segment within the broader professional services market. Federal agencies frequently procure these services to enhance operational efficiency, implement new systems, and manage complex programs. The total federal spending in this sector is substantial, reflecting its critical role in supporting government functions. This contract fits within the VA's ongoing efforts to modernize and streamline its administrative processes.

Small Business Impact

There is no indication that this contract included small business set-asides. Given the nature of the services and the prime contractor, it is unlikely that significant subcontracting opportunities for small businesses will be a primary focus, unless specifically mandated or pursued by Deloitte. The impact on the small business ecosystem is likely minimal for this specific award.

Oversight & Accountability

Oversight for this contract will be managed by the Department of Veterans Affairs, likely through a Contracting Officer's Representative (COR) who will monitor performance against the contract requirements. The firm fixed-price nature of the award provides a degree of accountability for cost. Transparency is facilitated by the contract's public availability, allowing for scrutiny of its terms and value.

Related Government Programs

VA IT Support Services
Federal Management Consulting Contracts
Administrative Operations Support
Business Process Improvement Services

Risk Flags

Limited competition despite full and open solicitation.
Potential for cost escalation if scope is not tightly managed.
Dependence on contractor performance for critical administrative functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $30.7 million to DELOITTE CONSULTING LLP. TASK ORDER FOR BARS SUPPORT SERVICES | 101

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $30.7 million.

What is the period of performance?

Start: 2023-03-29. End: 2025-08-06.

What is Deloitte Consulting LLP's track record with the Department of Veterans Affairs?

Deloitte Consulting LLP has a substantial history of contracting with the Department of Veterans Affairs across various service areas. They have been awarded numerous contracts for IT modernization, healthcare solutions, financial management, and administrative support. Their performance history with the VA is generally characterized by large-scale engagements, often involving complex system implementations and strategic consulting. While specific performance ratings for individual task orders are not publicly detailed, their continued success in securing significant VA contracts suggests a generally positive working relationship and perceived capability to meet the agency's needs. However, as with any large contractor, there may be instances of performance issues or disputes on specific projects that are not widely publicized.

How does the $30.6 million value compare to similar VA administrative support contracts?

Directly comparing the $30.6 million value to similar VA administrative support contracts is challenging without granular data on the specific services rendered, duration, and complexity. However, the average monthly cost of approximately $1.06 million ($30.6M / 29 months) for administrative management and general management consulting services appears to be within a reasonable range for large-scale, specialized support required by a federal agency of the VA's size. Many large federal consulting contracts, especially those involving system integration, process re-engineering, or strategic planning, can reach tens or even hundreds of millions of dollars. The key for value assessment lies in the specific deliverables, the expertise required, and the outcomes achieved relative to the investment.

What are the primary risks associated with this contract for the VA?

The primary risks for the VA associated with this contract include potential cost overruns if the scope of work expands beyond the initial fixed-price agreement (scope creep), although the fixed-price nature mitigates this to some extent. There's also a risk related to contractor performance; if Deloitte fails to deliver the required administrative support effectively, it could disrupt VA operations. Over-reliance on a single contractor for critical functions poses a continuity risk should the relationship terminate unexpectedly or if performance issues arise. Ensuring robust oversight and clear performance metrics are crucial to mitigating these risks and ensuring the VA receives the intended value.

How effective is the 'full and open competition' strategy when only 5 bids are received?

The effectiveness of 'full and open competition' when only five bids are received is debatable and depends on the specific market conditions for the services solicited. While 'full and open' theoretically allows all qualified vendors to compete, a low number of bids can indicate several things: the market for these specialized services might be limited, the solicitation requirements could have inadvertently deterred potential bidders, or the incumbent contractor (if applicable) may have had a significant advantage. For taxpayers, fewer bids generally mean less price pressure, potentially leading to a higher-than-optimal price. To maximize effectiveness, agencies should ensure solicitations are widely publicized, requirements are clear and achievable, and the market is adequately understood to encourage broader participation.

What is the historical spending pattern for administrative management consulting services at the VA?

The Department of Veterans Affairs historically spends significant amounts on administrative management and general management consulting services, reflecting the complexity and scale of its operations. Annual spending in this category can fluctuate based on agency priorities, modernization efforts, and specific program needs. Over the past decade, the VA has increasingly focused on improving its administrative efficiency and leveraging technology, often leading to substantial investments in consulting services. While specific year-over-year figures for NAICS code 541611 are not provided here, it is understood that the VA consistently ranks among the top federal agencies procuring these types of services, with contracts often awarded to large, established consulting firms.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $30,664,766

Exercised Options: $30,664,766

Current Obligation: $30,664,766

Actual Outlays: $30,664,766

Subaward Activity

Number of Subawards: 5

Total Subaward Amount: $9,345,419

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 47QRAA18D001P

IDV Type: FSS

Timeline