Education Dept. Spends $31M on G-5 Grants System IT Services with IBM

Contract Overview

Contract Amount: $31,047,676 ($31.0M)

Contractor: International Business Machines Corporation

Awarding Agency: Department of Education

Start Date: 2006-09-30

End Date: 2012-08-12

Contract Duration: 2,143 days

Daily Burn Rate: $14.5K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: INFORMATION TECHNOLOGY SERVICES TO DESIGN, DEVELOP AND DELIVER THE G-5 GRANTS MANAGEMENT SYSTEM

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20202

State: District of Columbia Government Spending

Plain-Language Summary

Department of Education obligated $31.0 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: INFORMATION TECHNOLOGY SERVICES TO DESIGN, DEVELOP AND DELIVER THE G-5 GRANTS MANAGEMENT SYSTEM Key points: 1. Significant investment of $31M for a grants management system. 2. Contract awarded to a single large vendor, IBM. 3. Long contract duration of 2143 days (approx. 6 years). 4. Firm Fixed Price contract type suggests cost certainty. 5. No small business participation noted.

Value Assessment

Rating: fair

The $31M price tag for a grants management system over nearly 6 years requires scrutiny. Benchmarking against similar large-scale IT development projects is necessary to assess value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: unknown

This was a competitive delivery order, indicating multiple bids were likely considered. However, the award to a single large vendor warrants examination of the competitive landscape and pricing.

Taxpayer Impact: Taxpayer funds were used for this contract. The value for money depends on the system's effectiveness and efficiency gains in grant management.

Public Impact

Impacts federal grant administration efficiency. Potential for improved data management and reporting for grants. Long-term system maintenance and upgrade costs are a consideration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of small business participation.
Long contract duration.
High total contract value.

Positive Signals

Competitive award process.
Firm Fixed Price contract.

Sector Analysis

Information Technology services for government systems are common. Benchmarks for similar grants management systems are difficult to ascertain without more specific details on functionality and scope.

Small Business Impact

The data indicates no small business participation in this contract. This represents a missed opportunity for small businesses to contribute to federal IT projects.

Oversight & Accountability

Oversight would focus on project milestones, performance metrics, and adherence to the firm fixed price. The Department of Education's internal controls would be key.

Related Government Programs

Computer and Software Stores
Department of Education Contracting
Department of Education Programs

Risk Flags

High contract value.
Long contract duration.
No small business participation.
Potential for vendor lock-in.

Frequently Asked Questions

What is this federal contract paying for?

Department of Education awarded $31.0 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. INFORMATION TECHNOLOGY SERVICES TO DESIGN, DEVELOP AND DELIVER THE G-5 GRANTS MANAGEMENT SYSTEM

Who is the contractor on this award?

The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Education (Department of Education).

What is the total obligated amount?

The obligated amount is $31.0 million.

What is the period of performance?

Start: 2006-09-30. End: 2012-08-12.

Was the $31M spent effectively to improve the G-5 Grants Management System's functionality and efficiency?

Assessing effectiveness requires examining system performance metrics, user satisfaction, and any documented improvements in grant processing times or accuracy. Without this data, it's difficult to definitively state if the $31M was well-spent, though the firm fixed price suggests a degree of cost control.

What were the primary risks associated with this long-term IT development contract, and how were they mitigated?

Risks likely included scope creep, technological obsolescence over the 6-year period, vendor performance issues, and integration challenges. Mitigation strategies would involve robust contract management, clear performance standards, phased delivery, and potentially contingency planning for unforeseen technical hurdles.

How did the competitive delivery order process ensure the best value was obtained for the taxpayer?

A competitive delivery order implies multiple vendors submitted proposals, allowing the Department of Education to compare technical solutions and pricing. The best value determination would depend on the evaluation criteria used, ensuring the chosen solution offered the optimal balance of cost, performance, and risk.

Industry Classification

NAICS: Retail Trade › Electronics and Appliance Stores › Computer and Software Stores

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

Competition & Pricing

Extent Competed: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: ED-06-Q-0006

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6710 ROCKLEDGE DRIVE, BETHESDA, MD, 20817

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

Financial Breakdown

Contract Ceiling: $31,047,676

Exercised Options: $31,047,676

Current Obligation: $31,047,676

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F4984H

IDV Type: FSS

Timeline