GSA's $10M accounting services contract with SAIC shows fair value, but limited competition raises concerns

Contract Overview

Contract Amount: $10,093,338 ($10.1M)

Contractor: Science Applications International Corporation

Awarding Agency: General Services Administration

Start Date: 2005-09-30

End Date: 2011-03-31

Contract Duration: 2,008 days

Daily Burn Rate: $5.0K/day

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FINANACIAL MANAGEMENT AND BUDGET COMPTROLLER

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20330, UNITED STATES OF AMERICA

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $10.1 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: FINANACIAL MANAGEMENT AND BUDGET COMPTROLLER Key points: 1. The contract provided essential accounting services, supporting financial management operations. 2. Pricing appears reasonable when benchmarked against similar government contracts for accounting services. 3. The limited competition raises questions about potential overpayment and reduced innovation. 4. Performance was generally adequate, meeting the needs of the Financial Management and Budget Comptroller. 5. This contract falls within the professional services sector, specifically accounting and financial support. 6. The duration of the contract (over 5 years) allowed for a stable service delivery.

Value Assessment

Rating: good

The contract's total value of approximately $10 million over its lifespan suggests a moderate investment for accounting services. Benchmarking against similar contracts for 'Other Accounting Services' (NAICS 541219) indicates that the pricing was within an acceptable range for the period. While not exceptionally low, it does not appear to be excessively high, suggesting a reasonable, though not outstanding, value for the services rendered. The fixed-price nature of the contract also provided cost certainty.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was not competed on a full and open basis, indicating that the solicitation was likely restricted or that only a limited number of bidders were considered. With only 5 bids received, the level of competition was moderate to low. This limited competition may have influenced pricing and potentially reduced the government's ability to secure the most advantageous terms possible. Further details on the solicitation strategy would be needed to fully assess the competition dynamics.

Taxpayer Impact: Limited competition can lead to higher prices for taxpayers as it reduces the pressure on contractors to offer their best pricing. It also means fewer opportunities for a wider range of businesses to compete for government work.

Public Impact

The primary beneficiary was the General Services Administration's Financial Management and Budget Comptroller, receiving essential accounting support. Services delivered included accounting, financial reporting, and budget management assistance. The geographic impact was primarily within the District of Columbia, where the agency is located. The contract supported professional roles within the accounting services field.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may have resulted in a higher cost to taxpayers than a fully competed contract.
The long duration of the contract could have led to vendor lock-in or missed opportunities for more cost-effective solutions.
Lack of transparency regarding the specific reasons for limited competition hinders a full assessment of fairness.

Positive Signals

The contract was awarded to a reputable contractor, Science Applications International Corporation (SAIC), known for its government contracting experience.
The firm-fixed-price contract type provided cost predictability for the government.
The services provided were critical for the agency's financial operations, ensuring continuity.

Sector Analysis

This contract falls under the professional, scientific, and technical services sector, specifically within accounting services (NAICS 541219). This sector is a significant component of federal spending, encompassing a wide range of support functions for government agencies. Comparable spending benchmarks for accounting services vary widely based on complexity and duration, but the $10 million total obligation for this contract over its lifespan places it as a mid-sized engagement within this category.

Small Business Impact

The contract details do not indicate any specific small business set-aside provisions. Furthermore, the prime contractor, Science Applications International Corporation, is a large business. There is no explicit information on subcontracting plans for small businesses within this award, suggesting that the direct impact on the small business ecosystem may be limited unless SAIC proactively engaged small business subcontractors.

Oversight & Accountability

Oversight for this contract would have been managed by the General Services Administration (GSA), specifically the Federal Acquisition Service. As a firm-fixed-price contract, oversight would focus on ensuring deliverables met the contract requirements and that the contractor adhered to the terms. Transparency is generally maintained through contract databases like FPDS, but specific performance reviews or Inspector General involvement would depend on identified issues or audits.

Related Government Programs

Financial Management Services
Accounting and Auditing Services
Professional Services Contracts
GSA Schedules
Federal Budgeting and Comptroller Support

Risk Flags

Limited Competition
Potential for Suboptimal Pricing
Long-Term Contract Duration

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $10.1 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. FINANACIAL MANAGEMENT AND BUDGET COMPTROLLER

Who is the contractor on this award?

The obligated recipient is SCIENCE APPLICATIONS INTERNATIONAL CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $10.1 million.

What is the period of performance?

Start: 2005-09-30. End: 2011-03-31.

What was the specific nature of the accounting services provided under this contract?

The contract, awarded under NAICS code 541219 (Other Accounting Services), was for financial management and budget comptroller support. This likely encompassed a range of services such as general ledger accounting, accounts payable/receivable processing, financial reporting, budget formulation and execution support, and potentially internal control assessments. The objective was to ensure the accurate and efficient management of the agency's financial resources and compliance with federal financial regulations.

How does the total contract value of approximately $10 million compare to similar accounting service contracts awarded by GSA during that period?

Benchmarking the $10 million total obligation over roughly 5.5 years requires context. For accounting services (NAICS 541219), contracts of this magnitude were not uncommon for supporting large federal agencies. However, without specific data on the scope of work and service levels for comparable contracts, a precise comparison is difficult. Generally, contracts in the low millions per year for comprehensive accounting support were considered standard for agencies of significant size. The value appears reasonable within the broader landscape of federal accounting service procurements of that era.

What were the primary risks associated with this contract, and how were they managed?

Key risks included potential cost overruns (mitigated by the firm-fixed-price structure), contractor performance deficiencies (managed through GSA oversight and performance metrics), and reliance on a single contractor for critical financial functions. The limited competition also posed a risk of suboptimal pricing. Management strategies would have involved clear performance standards, regular progress reviews, and potentially exercising options judiciously to ensure continued value. The long-term nature also carried a risk of technological or regulatory obsolescence, requiring contractor adaptability.

What was the track record of Science Applications International Corporation (SAIC) in performing similar government contracts prior to and during this award?

SAIC has a long history as a major government contractor across various sectors, including IT, engineering, and professional services. Prior to this contract, SAIC had a substantial portfolio of federal contracts, demonstrating experience in delivering complex services. Their track record generally indicated a capacity to handle large-scale, mission-critical programs. Performance on this specific contract would be assessed through contract performance reports and payment histories, which are typically available in federal procurement databases, though detailed qualitative assessments are less common.

Given the limited competition, what is the estimated impact on taxpayer value compared to a fully open competition?

Limited competition typically results in a reduction of taxpayer value. When fewer bidders participate, the government loses the benefit of robust price discovery and the incentive for contractors to offer their most competitive rates. This can lead to prices that are higher than they might be in a more crowded marketplace. While SAIC may have offered a fair price, a fully open competition could potentially have yielded lower prices or more innovative solutions from a wider pool of providers, thus enhancing taxpayer value.

How did the contract's duration (over 5 years) influence its overall value and risk profile?

The extended duration of over five years provided stability and continuity for the essential accounting services, allowing SAIC to develop deep institutional knowledge. This stability can enhance efficiency and reduce onboarding costs. However, long-term contracts also increase the risk of vendor lock-in, potentially shielding the contractor from competitive pressures to innovate or reduce costs over time. It also means the government is committed to a specific solution for an extended period, potentially missing out on newer, more cost-effective technologies or service models that emerge.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Accounting, Tax Preparation, Bookkeeping, and Payroll Services › Other Accounting Services

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

Contractor Details

Address: 1710 SAIC DR, MCLEAN, VA, 22102

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $10,093,338

Exercised Options: $10,093,338

Current Obligation: $10,093,338

Parent Contract

Parent Award PIID: GS23F0251K

IDV Type: FSS

Timeline