GSA's $101M IT support contract to Booz Allen Hamilton shows fair value, but limited competition raises concerns

Contract Overview

Contract Amount: $100,956,281 ($101.0M)

Contractor: Booz Allen Hamilton Inc

Awarding Agency: General Services Administration

Start Date: 2009-09-28

End Date: 2014-10-27

Contract Duration: 1,855 days

Daily Burn Rate: $54.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: THE OBJECTIVE OF THIS TASK ORDER (TO) IS TO OBTAIN SUPPORT IN SEVEN AREAS: TASK ORDER MANAGEMENT; CUSTOMER SUPPORT; OPERATIONS, SYSTEM INSTALLATIONS AND MAINTENANCE; INFORMATION TECHNOLOGY (IT) ENGINEERING AND SOFTWARE DEVELOPMENT; INFORMATION ASSURANCE; CONFIGURATION MANAGEMENT; AND ACQUISITION AND IT PROPERTY MANAGEMENT

Place of Performance

Location: NOVI, OAKLAND County, MICHIGAN, 48376

State: Michigan Government Spending

Plain-Language Summary

General Services Administration obligated $101.0 million to BOOZ ALLEN HAMILTON INC for work described as: THE OBJECTIVE OF THIS TASK ORDER (TO) IS TO OBTAIN SUPPORT IN SEVEN AREAS: TASK ORDER MANAGEMENT; CUSTOMER SUPPORT; OPERATIONS, SYSTEM INSTALLATIONS AND MAINTENANCE; INFORMATION TECHNOLOGY (IT) ENGINEERING AND SOFTWARE DEVELOPMENT; INFORMATION ASSURANCE; CONFIGURATION MANAGEMENT;… Key points: 1. The contract provided essential IT support across multiple domains, indicating a broad scope of services. 2. Booz Allen Hamilton, a large established contractor, likely leveraged its existing infrastructure and expertise. 3. The cost-plus-fixed-fee structure can incentivize cost control, but requires careful oversight. 4. The contract's duration of over five years suggests a need for stable, long-term IT support. 5. Performance was rated 'satisfactory' by the agency, indicating general fulfillment of requirements. 6. The contract's value falls within a typical range for large-scale IT support services.

Value Assessment

Rating: good

This contract's total value of approximately $101 million over five years for comprehensive IT support services appears reasonable when benchmarked against similar large-scale IT service contracts awarded by federal agencies. The cost-plus-fixed-fee (CPFF) pricing structure, while common for complex IT services, necessitates diligent oversight to ensure cost efficiency. Without specific performance metrics or detailed cost breakdowns, a precise value-for-money assessment is challenging, but the satisfactory performance rating suggests the services met agency needs within the allocated budget.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to compete. However, the data shows only two bids were received. While full and open competition is the preferred method, a low number of bids can sometimes suggest barriers to entry or a lack of widespread interest from potential contractors, which could indirectly impact price discovery.

Taxpayer Impact: A low number of bids, even under full and open competition, may mean taxpayers did not benefit from the most competitive pricing possible, as fewer companies vied for the contract.

Public Impact

Federal agencies, including the General Services Administration (GSA), benefited from enhanced IT operations, system maintenance, and information assurance. The contract supported critical IT functions such as system installations, software development, and configuration management. Geographic impact is likely nationwide, given the nature of federal IT support services. The contract supported a workforce of IT professionals, contributing to the federal IT sector employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Fixed Fee contracts if not managed tightly.
Limited competition (2 bids) may have resulted in a higher price than if more bidders had participated.
Long contract duration could lead to vendor lock-in or slower adoption of newer technologies if not managed proactively.

Positive Signals

Contract awarded through full and open competition, adhering to federal procurement principles.
Satisfactory performance rating indicates the contractor met or exceeded expectations.
Booz Allen Hamilton is a well-established contractor with a proven track record in federal IT services.

Sector Analysis

This contract falls within the Computer Systems Design Services sector, a significant segment of the federal IT market. This sector encompasses a wide range of services from custom software development to IT infrastructure management. Spending in this area is consistently high across federal agencies as they modernize systems and enhance cybersecurity. The $101 million value positions this as a substantial contract within this domain, comparable to other large IT support vehicles.

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside goal, and the contractor, Booz Allen Hamilton, is a large business. There is no explicit information on subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific contract appears minimal, though large prime contractors often engage small businesses for specialized support.

Oversight & Accountability

The contract was managed by the General Services Administration (GSA), which has established oversight mechanisms for its task orders. Performance was monitored, and the contractor received a satisfactory rating. Transparency is generally maintained through federal procurement databases like FPDS. Inspector General oversight would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

IT Infrastructure Support Services
Information Technology Professional Services
Computer Systems Design Services
IT Management and Support

Risk Flags

Low number of bids received under full and open competition.
Cost-plus-fixed-fee structure requires diligent cost oversight.
Potential for vendor lock-in due to long contract duration.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $101.0 million to BOOZ ALLEN HAMILTON INC. THE OBJECTIVE OF THIS TASK ORDER (TO) IS TO OBTAIN SUPPORT IN SEVEN AREAS: TASK ORDER MANAGEMENT; CUSTOMER SUPPORT; OPERATIONS, SYSTEM INSTALLATIONS AND MAINTENANCE; INFORMATION TECHNOLOGY (IT) ENGINEERING AND SOFTWARE DEVELOPMENT; INFORMATION ASSURANCE; CONFIGURATION MANAGEMENT; AND ACQUISITION AND IT PROPERTY MANAGEMENT

Who is the contractor on this award?

The obligated recipient is BOOZ ALLEN HAMILTON INC.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $101.0 million.

What is the period of performance?

Start: 2009-09-28. End: 2014-10-27.

What was the specific nature of the IT support provided under this contract?

The task order aimed to provide support in seven key areas: Task Order Management, Customer Support, Operations, System Installations and Maintenance, Information Technology (IT) Engineering and Software Development, Information Assurance, Configuration Management, and Acquisition and IT Property Management. This broad scope indicates comprehensive support for the agency's IT infrastructure and operations, covering everything from day-to-day maintenance to more complex engineering and development tasks.

How does the pricing structure (Cost Plus Fixed Fee) typically affect value for money in IT contracts?

A Cost Plus Fixed Fee (CPFF) contract reimburses the contractor for allowable costs incurred plus a fixed fee representing profit. This structure is often used for research and development or complex IT services where the scope may evolve. While it allows for flexibility, it can incentivize contractors to incur more costs to increase their fee if the fee is a percentage of costs. For value for money, rigorous cost monitoring and control by the agency are crucial to prevent overspending and ensure the fixed fee remains appropriate for the services rendered.

What are the implications of only two bids being submitted for a 'full and open' competition?

Receiving only two bids in a 'full and open' competition, despite the contract's substantial value and duration, suggests potential limitations in the market or the solicitation process. This could be due to high barriers to entry for smaller firms, specific technical requirements that only a few contractors could meet, or perhaps the solicitation was not widely publicized or attractive enough. While the competition was technically open, a low number of bidders generally reduces competitive pressure, potentially leading to less favorable pricing for the government compared to a scenario with multiple, robust bids.

What is Booz Allen Hamilton's track record with similar federal IT contracts?

Booz Allen Hamilton is a major government contractor with extensive experience in IT services, systems engineering, and consulting across various federal agencies. They have a long history of managing large, complex IT contracts, including those involving system design, development, integration, and maintenance. Their track record generally includes successful delivery on numerous high-value contracts, though like any large firm, they have also faced scrutiny on specific projects. Their established presence suggests they possess the resources and expertise to handle significant IT support requirements.

How does this contract's spending compare to overall federal IT spending trends?

This contract, valued at approximately $101 million over five years, represents a portion of the vast federal IT spending. Federal IT spending typically runs into the tens of billions of dollars annually, covering a wide array of services including infrastructure, software development, cybersecurity, and cloud migration. While $101 million is a significant sum for a single task order, it is in line with the scale of IT support contracts awarded to large system integrators and IT service providers by major agencies like GSA, DOD, and DHS, reflecting the ongoing need for robust IT capabilities within the government.

Were there any specific performance issues or risks identified during the contract period?

The provided data indicates a 'satisfactory' performance rating from the agency. This suggests that while requirements were met, there may not have been exceptional performance that would warrant a rating higher than satisfactory. Specific performance issues or risks are not detailed in the summary data. However, for CPFF contracts, risks often revolve around cost control, schedule adherence, and ensuring the delivered technical solution meets evolving requirements. Without detailed performance reports, it's difficult to ascertain specific risks encountered.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Parent Company: Booz Allen Hamilton Holding Corporation (UEI: 964725688)

Address: 8283 GREENSBORO DR # 700, MC LEAN, VA, 22102

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $114,317,955

Exercised Options: $114,317,955

Current Obligation: $100,956,281

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS00T99ALD0202

IDV Type: GWAC

Timeline