DHS awards $13M for IT support to IBM, raising questions about value and competition

Contract Overview

Contract Amount: $13,057,850 ($13.1M)

Contractor: International Business Machines Corporation

Awarding Agency: Department of Homeland Security

Start Date: 2008-07-28

End Date: 2010-08-27

Contract Duration: 760 days

Daily Burn Rate: $17.2K/day

Competition Type: FULL AND OPEN COMPETITION

Sector: IT

Official Description: WORK ORDER 3 FROM OASIS, TIER 3 SUPPORT FOR CSG AND SF

Place of Performance

Location: ANNAPOLIS JUNCTION, HOWARD County, MARYLAND, 20701

State: Maryland Government Spending

Plain-Language Summary

Department of Homeland Security obligated $13.1 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: WORK ORDER 3 FROM OASIS, TIER 3 SUPPORT FOR CSG AND SF Key points: 1. Contract awarded to a single, large vendor, potentially limiting competitive pricing. 2. Duration of the contract (over 2 years) suggests a need for sustained IT support. 3. The specific services (Tier 3 support) are critical for operational continuity. 4. Lack of small business set-aside may reduce opportunities for smaller IT firms. 5. The award falls under a broader OASIS contract, indicating a pre-existing framework. 6. Geographic location in Maryland suggests a focus on a specific operational hub.

Value Assessment

Rating: fair

The contract value of $13 million for approximately two years of Tier 3 IT support appears within a reasonable range for a large federal IT services contract. However, without specific details on the scope of work, service level agreements, and comparable pricing for similar Tier 3 support from other vendors under the OASIS contract or similar GWACs, a definitive value-for-money assessment is challenging. The use of a BPA call suggests that pricing might be pre-negotiated, but the ultimate cost-effectiveness depends on the specific services rendered and the efficiency of the support provided by IBM.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a BPA call, which itself was likely competed under the OASIS (One Acquisition Solution for Integrated Services) indefinite-delivery/indefinite-quantity (IDIQ) contract. OASIS is designed for full and open competition. While the initial OASIS contract underwent a competitive process, the specific BPA call award to IBM implies that IBM was one of the awardees or a participant in a further competition under OASIS. The number of bidders for this specific BPA call is not provided, but the nature of OASIS generally encourages broad competition.

Taxpayer Impact: Full and open competition, as facilitated by the OASIS vehicle, is intended to ensure that the government receives competitive pricing and the best value. However, the effectiveness of this competition for this specific BPA call depends on the number of vendors actively bidding and the pricing strategies employed.

Public Impact

The Transportation Security Administration (TSA) benefits from enhanced IT support, ensuring the smooth operation of critical systems. Federal employees and contractors relying on TSA's IT infrastructure will experience improved system stability and faster issue resolution. The primary geographic impact is likely within the operational areas served by the TSA, potentially concentrated in Maryland where the contract is managed. The contract supports the IT workforce by providing specialized Tier 3 support, potentially involving skilled technicians and engineers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the scope of work expands beyond initial estimates.
Reliance on a single large contractor (IBM) could lead to vendor lock-in.
The effectiveness of Tier 3 support is dependent on the responsiveness and expertise of IBM's personnel.
The specific performance metrics and Service Level Agreements (SLAs) are not detailed, making performance monitoring difficult.

Positive Signals

Awarded under the OASIS contract, which is a government-wide vehicle designed for efficiency and competition.
IBM is a well-established IT services provider with a significant track record in supporting federal agencies.
Tier 3 support indicates a focus on high-level technical problem-solving, crucial for complex systems.
The contract duration suggests a stable, long-term need for these services, allowing for consistent support.

Sector Analysis

This contract falls within the Information Technology (IT) services sector, specifically focusing on IT support and maintenance. The IT services market for the federal government is substantial, with agencies like Homeland Security being major consumers. Contracts like this are common for providing specialized technical support, network management, and system maintenance. The use of the OASIS IDIQ contract vehicle is a prevalent strategy for agencies seeking flexible and efficient procurement of a wide range of professional services, including IT.

Small Business Impact

This contract does not appear to have a small business set-aside, as indicated by 'sb': false. Furthermore, the 'ss' (small business) flag is also false. This suggests that the contract was not specifically targeted towards small businesses, and there is no explicit indication of subcontracting goals for small businesses. Consequently, the direct impact on the small business IT ecosystem may be limited, with opportunities primarily flowing to the large prime contractor, IBM.

Oversight & Accountability

Oversight for this contract would likely fall under the Department of Homeland Security's (DHS) contracting and program management offices, specifically within the Transportation Security Administration (TSA). As an award under the OASIS contract, there are established oversight mechanisms within the General Services Administration (GSA) that manages OASIS. Transparency is facilitated through contract databases like FPDS. Inspector General (IG) jurisdiction would apply if any issues of fraud, waste, or abuse arise during the contract performance.

Related Government Programs

OASIS (One Acquisition Solution for Integrated Services)
IT Support Services
Department of Homeland Security IT Contracts
Transportation Security Administration Operations

Risk Flags

Potential for cost creep
Vendor lock-in risk
Performance metric clarity
Cybersecurity assurance

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $13.1 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. WORK ORDER 3 FROM OASIS, TIER 3 SUPPORT FOR CSG AND SF

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 (Transportation Security Administration).

What is the total obligated amount?

The obligated amount is $13.1 million.

What is the period of performance?

Start: 2008-07-28. End: 2010-08-27.

What is the specific scope of 'Tier 3 Support' for CSG and SF under this contract?

Tier 3 support typically refers to the highest level of technical support, addressing complex issues that cannot be resolved by lower tiers (Tier 1: help desk, Tier 2: advanced technical support). For the 'CSG' (likely a specific system or group) and 'SF' (potentially a software or system component), this would involve in-depth troubleshooting, root cause analysis, system diagnostics, and potentially software patching or configuration changes. The exact definition and boundaries of Tier 3 support are usually detailed in the contract's Statement of Work (SOW) or Performance Work Statement (PWS). Without the SOW, it's difficult to ascertain the precise services, such as server administration, database management, network infrastructure support, or application-specific problem resolution.

How does the $13 million cost compare to similar Tier 3 IT support contracts for federal agencies?

Benchmarking this $13 million contract requires comparing it to similar Tier 3 IT support contracts, ideally those awarded under the same or comparable IDIQ vehicles (like GSA's Alliant or other GWACs) and for agencies with similar IT complexity to DHS/TSA. Factors influencing cost include the number of systems supported, user base size, required response times (SLAs), and the specific technologies involved. A $13 million award over approximately two years averages around $6.5 million per year. This figure needs to be assessed against market rates for specialized IT support personnel and services. For instance, if this contract covers 24/7 support for mission-critical systems with stringent uptime requirements, the cost might be justified. Conversely, if it's for standard IT maintenance with less demanding SLAs, it could be considered high.

What is IBM's track record with DHS and similar federal IT support contracts?

International Business Machines Corporation (IBM) has a long-standing and extensive history of providing IT services to the U.S. federal government, including various agencies within the Department of Homeland Security (DHS). IBM is a major federal contractor, often securing large-scale IT modernization, cloud services, cybersecurity, and infrastructure support contracts. Their track record with DHS likely includes numerous awards across different sub-agencies and functional areas. While specific performance details for every contract are not publicly available, IBM's continued presence as a prime contractor suggests a generally satisfactory performance history, though like any large vendor, they may have faced challenges or criticisms on specific engagements. Reviewing past performance evaluations and contract award data would provide a more granular understanding.

What are the potential risks associated with relying on IBM for this critical IT support?

Key risks include vendor lock-in, where the agency becomes heavily dependent on IBM's proprietary systems or processes, making future transitions difficult and costly. There's also the risk of performance issues if IBM fails to meet Service Level Agreements (SLAs), potentially impacting TSA's operations. Cost escalation is another concern, especially if the scope of work expands or if contract modifications are frequent. Furthermore, cybersecurity risks are inherent in any IT support contract; ensuring IBM maintains robust security practices to protect sensitive government data is paramount. Finally, a lack of sufficient competition for follow-on work could reduce leverage for future contract negotiations.

How has spending on IT support services by the TSA evolved over the past five years?

Analyzing TSA's spending on IT support services over the past five years would require accessing historical procurement data. Generally, federal agencies, including TSA, have seen increasing IT expenditures driven by modernization efforts, cybersecurity needs, and the adoption of new technologies like cloud computing and data analytics. Spending on support services often correlates with the complexity and age of the IT infrastructure. If TSA has been undergoing significant system upgrades or migrations, spending on specialized support like Tier 3 services might have fluctuated. A trend towards consolidating contracts or shifting towards managed services could also be observed. Without specific data, it's speculative, but the overall trend in government IT spending has been upward, with a strong emphasis on security and modernization.

Industry Classification

NAICS: Wholesale Trade › Professional and Commercial Equipment and Supplies Merchant Wholesalers › Computer and Computer Peripheral Equipment and Software Merchant Wholesalers

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Evaluated Preference: NONE

Contractor Details

Address: 6710 ROCKLEDGE DR, BETHESDA, MD, 20817

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $13,057,850

Exercised Options: $13,057,850

Current Obligation: $13,057,850

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HSTS0307ACIO925

IDV Type: BPA

Timeline