DHS FEMA Awards $164.6M IT Services Contract to IBM, Replacing Expiring CDS Contract

Contract Overview

Contract Amount: $164,610,049 ($164.6M)

Contractor: International Business Machines Corporation

Awarding Agency: Department of Homeland Security

Start Date: 2011-09-30

End Date: 2017-09-30

Contract Duration: 2,192 days

Daily Burn Rate: $75.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIXED PRICE INCENTIVE

Sector: IT

Official Description: THE PURPOSE OF THIS CONTRACT IS TO OBTAIN CONTRACTED SUPPORT WHICH WILL REPLACE THE EXPIRING CUSTOMER AND DATA SERVIES (CDS) CONTRACT.

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20817

State: Maryland Government Spending

Plain-Language Summary

Department of Homeland Security obligated $164.6 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: THE PURPOSE OF THIS CONTRACT IS TO OBTAIN CONTRACTED SUPPORT WHICH WILL REPLACE THE EXPIRING CUSTOMER AND DATA SERVIES (CDS) CONTRACT. Key points: 1. Contract aims to replace an expiring IT services contract, ensuring continuity of customer and data services. 2. IBM, a major IT provider, secured this contract through full and open competition. 3. The contract's fixed-price incentive structure aims to align contractor performance with agency goals. 4. This award falls within the broad 'Information Services' NAICS code, a common area for federal IT spending.

Value Assessment

Rating: good

The contract value of $164.6M over its period of performance appears reasonable for comprehensive IT services. Benchmarking against similar large-scale IT support contracts would provide a more precise assessment of its value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a robust process for soliciting bids and achieving competitive pricing. This method generally leads to better price discovery and value for the government.

Taxpayer Impact: Full and open competition is intended to maximize taxpayer value by ensuring the government receives the best possible services at the most competitive prices.

Public Impact

Ensures continued critical customer and data services for FEMA operations. Supports FEMA's mission by providing necessary IT infrastructure and support. Potential for improved service delivery through a new, consolidated contract. IBM's involvement suggests a focus on established IT solutions and expertise.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Contract duration is substantial (2192 days).
Fixed Price Incentive (FPI) contracts can be complex to manage.
Reliance on a single large vendor for critical services.

Positive Signals

Awarded through full and open competition.
Aims to replace an expiring contract, ensuring service continuity.
IBM is a well-established IT services provider.

Sector Analysis

This contract falls under the Information Services sector, a significant area of federal IT spending. Benchmarks for similar large-scale IT support contracts can vary widely based on scope and duration.

Small Business Impact

The data indicates this contract was awarded to a large business (IBM) and does not specify any small business set-asides or subcontracting goals. Further analysis would be needed to determine the extent of small business participation.

Oversight & Accountability

The contract's fixed-price incentive structure implies performance metrics and potential adjustments based on outcomes. Oversight would focus on ensuring IBM meets service level agreements and cost targets.

Related Government Programs

All Other Information Services
Department of Homeland Security Contracting
Federal Emergency Management Agency Programs

Risk Flags

Potential for vendor lock-in with a large provider.
Complexity of managing Fixed Price Incentive contracts.
Risk of service disruption during contract transition.
Dependence on a single contractor for critical data services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $164.6 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. THE PURPOSE OF THIS CONTRACT IS TO OBTAIN CONTRACTED SUPPORT WHICH WILL REPLACE THE EXPIRING CUSTOMER AND DATA SERVIES (CDS) CONTRACT.

Who is the contractor on this award?

The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Federal Emergency Management Agency).

What is the total obligated amount?

The obligated amount is $164.6 million.

What is the period of performance?

Start: 2011-09-30. End: 2017-09-30.

What specific IT services are included under this contract, and how do they align with FEMA's current and future needs?

The contract aims to replace the expiring Customer and Data Services (CDS) contract, implying a broad scope of IT support. This likely includes maintaining existing systems, data management, and potentially new service integrations. A detailed review of the Statement of Work (SOW) is necessary to confirm alignment with FEMA's strategic IT roadmap and evolving operational requirements.

What are the key performance indicators (KPIs) and incentive mechanisms within this Fixed Price Incentive (FPI) contract, and how are they structured to mitigate risk?

The FPI structure suggests defined target costs, target profits, and ceiling prices, with adjustments based on performance against agreed-upon metrics. Specific KPIs would likely relate to system uptime, response times, data integrity, and project completion. The agency's oversight is crucial to ensure these metrics effectively drive desired outcomes and manage cost overruns.

How does the transition from the expiring CDS contract to this new IBM contract impact service continuity and potential disruptions for FEMA users?

The primary purpose is to ensure continuity, suggesting a planned transition. However, any large-scale IT contract transition carries inherent risks of disruption. FEMA's project management and IBM's transition plan would be critical in minimizing downtime and ensuring seamless service delivery to end-users throughout the changeover period.

Industry Classification

NAICS: Information › Other Information Services › All Other Information Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: HSFEHQ-11-R-0029

Offers Received: 3

Pricing Type: FIXED PRICE INCENTIVE (L)

Evaluated Preference: NONE

Contractor Details

Address: 6710 ROCKLEDGE DR, BETHESDA, MD, 20817

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

Financial Breakdown

Contract Ceiling: $176,102,618

Exercised Options: $165,036,825

Current Obligation: $164,610,049

Subaward Activity

Number of Subawards: 75

Total Subaward Amount: $21,707,904

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline