USAID's $24.8M CGI Federal contract for critical IT functions saw cost-plus incentives, awarded via full and open competition

Contract Overview

Contract Amount: $24,792,555 ($24.8M)

Contractor: CGI Federal Inc.

Awarding Agency: Agency for International Development

Start Date: 2015-06-30

End Date: 2022-02-15

Contract Duration: 2,422 days

Daily Burn Rate: $10.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: COST PLUS INCENTIVE FEE

Sector: IT

Official Description: IGF::CT::IGF CRITICAL FUNCTIONS PHOENIX UPGRADE AND GLAAS INTEGRATION

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20523

State: District of Columbia Government Spending

Plain-Language Summary

Agency for International Development obligated $24.8 million to CGI FEDERAL INC. for work described as: IGF::CT::IGF CRITICAL FUNCTIONS PHOENIX UPGRADE AND GLAAS INTEGRATION Key points: 1. The contract utilized a cost-plus incentive fee structure, suggesting a focus on performance and cost control. 2. Awarded under full and open competition, this indicates a broad market solicitation for the services. 3. The contract duration of over 2400 days points to a long-term need for these IT services. 4. The North American Industry Classification System (NAICS) code 541519 suggests a broad scope of computer-related services. 5. The contract was a BPA Call, indicating it was likely part of a larger pre-competed agreement. 6. The contract was not set aside for small businesses, suggesting the scope or nature of services favored larger entities.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics and detailed cost breakdowns. The cost-plus incentive fee (CPIF) structure implies that both the contractor and the agency had incentives to manage costs effectively, but it can also lead to higher final costs if not tightly managed. Comparing it to similar large-scale IT integration projects within USAID or other agencies would provide better context on whether the final cost was competitive for the services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This specific designation suggests that while the competition was intended to be open, there might have been prior exclusions or specific circumstances that led to this phrasing. Typically, full and open competition aims to solicit offers from all responsible sources. The number of bidders and the specific evaluation criteria would be crucial to fully assess the competitive landscape and its impact on pricing.

Taxpayer Impact: A full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation. It ensures that the government is not limited to a single provider, increasing the likelihood of obtaining the best value.

Public Impact

The primary beneficiaries are likely USAID's internal operations, benefiting from upgraded critical IT functions and integrated systems. The services delivered support the agency's mission-critical IT infrastructure, ensuring continuity and potentially enhancing efficiency. The contract's impact is primarily concentrated within the District of Columbia, where USAID's headquarters are located. The contract likely supported a workforce of IT professionals, including developers, system administrators, and project managers, both within CGI Federal and potentially subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' in the competition type warrants further investigation to understand if it limited potential bidders.
Cost-plus incentive fee contracts can sometimes lead to cost overruns if not meticulously monitored.
The long contract duration could indicate potential for scope creep or evolving requirements that may impact overall cost-effectiveness.

Positive Signals

The use of full and open competition suggests an effort to leverage market competition for best value.
The incentive fee structure implies a mechanism to reward contractor performance and cost efficiency.
The contract's focus on critical IT functions and integration indicates a strategic investment in essential agency infrastructure.

Sector Analysis

This contract falls within the Information Technology (IT) services sector, specifically focusing on IT system integration, maintenance, and upgrade services. The IT services market is vast and highly competitive, with numerous firms offering specialized solutions. Contracts of this nature are common across federal agencies requiring robust IT infrastructure to support their operations. Benchmarks for similar large-scale IT modernization projects can vary significantly based on complexity, duration, and specific technologies involved.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the scope, complexity, or nature of the required IT services may have been better suited for larger contractors, or that the competition was structured in a way that did not prioritize small business participation. There is no explicit information on subcontracting plans, but in large IT contracts, there is often an expectation or requirement for prime contractors to engage small businesses for specific components or services.

Oversight & Accountability

Oversight for this contract would typically fall under USAID's contracting officers and program managers. The Inspector General (IG) of USAID would likely have jurisdiction for audits and investigations related to potential fraud, waste, or abuse. Transparency is often facilitated through contract award databases and reporting requirements, though detailed performance and cost data may not always be publicly accessible. The CPIF structure necessitates close monitoring of costs and performance against established targets.

Related Government Programs

USAID IT Modernization Programs
Federal Civilian Agency IT Infrastructure Support
Large-Scale System Integration Contracts
Cost-Plus Incentive Fee Contracts

Risk Flags

Potential for cost overruns due to CPIF structure.
Risk of technology obsolescence over the long contract duration.
Ambiguity in competition type ('exclusion of sources').
Lack of transparency on specific performance metrics and outcomes.

Frequently Asked Questions

What is this federal contract paying for?

Agency for International Development awarded $24.8 million to CGI FEDERAL INC.. IGF::CT::IGF CRITICAL FUNCTIONS PHOENIX UPGRADE AND GLAAS INTEGRATION

Who is the contractor on this award?

The obligated recipient is CGI FEDERAL INC..

Which agency awarded this contract?

Awarding agency: Agency for International Development (Agency for International Development).

What is the total obligated amount?

The obligated amount is $24.8 million.

What is the period of performance?

Start: 2015-06-30. End: 2022-02-15.

What specific critical IT functions were covered under this contract, and what was the primary objective of the Phoenix upgrade and GLAAS integration?

The contract, identified by the data string 'IGF::CT::IGF CRITICAL FUNCTIONS PHOENIX UPGRADE AND GLAAS INTEGRATION,' indicates a focus on maintaining and enhancing critical IT functions for the Agency for International Development (USAID). The 'Phoenix upgrade' likely refers to a system modernization or replacement initiative, possibly related to core financial, operational, or data management systems. The 'GLAAS integration' suggests the incorporation of the Global Acquisition and Assistance System, a platform used by USAID for managing its programs and awards. The primary objective was likely to improve the efficiency, security, and interoperability of USAID's IT infrastructure, ensuring seamless data flow and operational continuity for its global mission.

How did the 'cost-plus incentive fee' (CPIF) structure influence the contractor's performance and the final cost of the contract?

A Cost-Plus Incentive Fee (CPIF) contract is designed to share risks and rewards between the government and the contractor. Under a CPIF arrangement, the final negotiated fee is adjusted upward or downward based on whether the final costs are below or above the target cost, within an agreed-upon sharing ratio. This structure incentivizes the contractor (CGI Federal Inc.) to control costs and perform efficiently to achieve a higher fee. For USAID, it offers potential cost savings if the contractor meets or exceeds performance targets and stays within cost parameters. However, it also requires robust oversight from USAID to ensure that cost targets are realistic and that performance metrics are clearly defined and measurable to prevent potential manipulation or excessive cost escalation.

What does 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' imply about the bidding process for this contract?

The designation 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' is somewhat unusual and requires careful interpretation. Typically, 'full and open competition' means offers are solicited from all responsible sources and the contract is awarded to the responsible source submitting the lowest price technically acceptable offer, or other best value criteria. The addition of 'after exclusion of sources' suggests that prior to this specific solicitation, certain potential sources may have been excluded, perhaps due to previous performance issues, specific requirements not met, or other contractual reasons. It implies that while the final competition was open to all remaining eligible responsible sources, the pool of potential bidders might have been narrowed down beforehand. This could potentially limit the breadth of competition compared to a standard full and open process.

Given the contract's duration of over 2400 days (approximately 6.6 years), what are the potential risks and benefits associated with such a long-term IT services agreement?

A long-term IT services agreement like this one presents both significant benefits and risks. Benefits include potential cost savings through economies of scale, consistent support for critical systems, and the ability for the contractor to develop deep institutional knowledge, leading to more efficient service delivery over time. It also provides stability and predictability for both the agency and the contractor. However, risks are also substantial. Technology evolves rapidly, and a long-term contract might lock the agency into outdated solutions, requiring costly modifications or early termination. There's also the risk of vendor lock-in, reduced flexibility to adapt to changing requirements, and potential for complacency or decreased innovation from the contractor over time. Effective contract management, including regular reviews and potential for renegotiation, is crucial to mitigate these risks.

How does the NAICS code 541519 ('Other Computer Related Services') align with the described contract activities (Phoenix upgrade and GLAAS integration)?

The North American Industry Classification System (NAICS) code 541519, 'Other Computer Related Services,' is a broad category that encompasses a wide range of IT services not specifically classified under other codes. This includes services such as IT consulting, systems integration, disaster recovery services, and IT support. The description of the contract involving a 'Phoenix upgrade' and 'GLAAS integration' aligns well with this NAICS code. These activities typically involve complex system design, development, implementation, and integration, which fall under the umbrella of 'other computer related services' when they don't fit more specific categories like custom software development (541511) or computer facilities management (541512).

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Parent Company: CGI Inc

Address: 12601 FAIR LAKES CIRCLE, FAIRFAX, VA, 22033

Business Categories: Category Business, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $24,831,394

Exercised Options: $24,831,394

Current Obligation: $24,792,555

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: SAQMMA10A0058

IDV Type: BPA

Timeline