DHS awarded IBM $23M for application support, raising questions about value and competition

Contract Overview

Contract Amount: $23,030,168 ($23.0M)

Contractor: International Business Machines Corporation

Awarding Agency: Department of Homeland Security

Start Date: 2010-02-01

End Date: 2013-12-03

Contract Duration: 1,401 days

Daily Burn Rate: $16.4K/day

Competition Type: FULL AND OPEN COMPETITION

Sector: IT

Official Description: SUBJECT: APPLICATION SUPPORT TEAM (AST) (FY09 CONTRACT HSTS03-09-J-CIO502) SPEND PLAN INFORMATION BRANCH/OFFICE: OIT / SYSTEMS INNOVATION DIVISION; SPEND PLAN PORTFOLIO: APPLICATIONS DEVELOPMENT; SPEND PLAN LINE ITEM: APPLICATIONS SUPPORT TEAM (AST) THE OBJECTIVE OF THIS PROCUREMENT IS TO PROVIDE ONGOING SUSTAINMENT OF APPLICATIONS SUPPORT AND RELATED ACTIVITIES, INCLUDING LEVEL 2 APPLICATION SUPPORT, LEVEL 3 APPLICATION SUPPORT, BREAK/FIX SUPPORT, CONFIGURATION MANAGEMENT, TESTING, AND RELEASE MANAGEMENT.

Place of Performance

Location: HERNDON, LOUDOUN County, VIRGINIA, 20598, UNITED STATES OF AMERICA

State: Virginia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $23.0 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: SUBJECT: APPLICATION SUPPORT TEAM (AST) (FY09 CONTRACT HSTS03-09-J-CIO502) SPEND PLAN INFORMATION BRANCH/OFFICE: OIT / SYSTEMS INNOVATION DIVISION; SPEND PLAN PORTFOLIO: APPLICATIONS DEVELOPMENT; SPEND PLAN LINE ITEM: APPLICATIONS SUPPORT TEAM (AST) THE OBJECTIVE OF THI… Key points: 1. The contract's duration of 1401 days (nearly 4 years) suggests a long-term need for application support. 2. IBM's role in providing Level 2 and Level 3 support, break/fix, configuration, testing, and release management indicates a comprehensive scope of services. 3. The contract was awarded under a Blanket Purchase Agreement (BPA), which can offer some efficiencies but may limit direct price comparison. 4. The absence of specific performance metrics or outcome-based measures makes it difficult to assess the true value for money. 5. The contract's focus on sustaining existing applications rather than developing new ones suggests a maintenance-heavy operational environment. 6. The total value of $23M over the contract period averages to approximately $5.9M per year, requiring further benchmarking.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without more detailed service level agreements and performance data. The total award of $23M over nearly four years, while substantial, needs to be evaluated against the specific services provided and the complexity of the applications supported. Comparing this to similar application sustainment contracts within DHS or other agencies would be necessary to determine if the pricing is competitive. The lack of readily available performance metrics makes a definitive value-for-money assessment difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. However, the specific details of the competition, such as the number of bids received and the evaluation criteria, are not provided. Awarding under a BPA suggests that a pre-negotiated framework was in place, which could influence the competitive landscape.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to better pricing and service quality. However, the ultimate benefit depends on the rigor of the competition and the effectiveness of the evaluation process.

Public Impact

Federal employees within the Department of Homeland Security, particularly the Transportation Security Administration, benefit from the sustained operation of critical applications. The contract ensures the availability of Level 2 and Level 3 application support, break/fix services, configuration management, testing, and release management. The geographic impact is primarily within the operational areas of the TSA, likely supporting nationwide functions. The contract supports IT professionals, potentially including both government personnel and contractor staff, involved in application sustainment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific performance metrics makes it difficult to assess contractor effectiveness and value.
The long contract duration without clear performance benchmarks could lead to complacency or reduced incentive for innovation.
Limited transparency on the competitive bidding process beyond 'full and open' hinders a thorough assessment of price reasonableness.

Positive Signals

Awarded under full and open competition, suggesting a broad market solicitation.
The contract covers a comprehensive suite of application sustainment services, indicating a thorough understanding of agency needs.
The use of a BPA may streamline procurement and potentially offer cost efficiencies for ongoing support.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on application sustainment and support. The market for IT support services is highly competitive, with numerous large and small businesses offering a wide range of capabilities. Spending on application maintenance and support is a significant portion of IT budgets across federal agencies, as it is crucial for the continued operation of essential government functions. Comparable spending benchmarks would typically involve analyzing the average cost of application support per system or per user across similar federal agencies.

Small Business Impact

The data indicates that small business participation was not a primary focus, as the contract was awarded to IBM, a large corporation, and there is no explicit mention of small business set-asides or subcontracting goals. This suggests that the primary contract was not specifically targeted towards small businesses. The impact on the small business ecosystem would likely be indirect, potentially through subcontracting opportunities if IBM chose to engage small businesses, which is not detailed in the provided information.

Oversight & Accountability

Oversight mechanisms for this contract would typically involve program managers within the TSA and DHS's Office of the Chief Information Officer (OCIO). Accountability would be driven by adherence to contract terms, service level agreements (if defined), and performance standards. Transparency is often facilitated through contract databases and reporting requirements, though specific details of ongoing oversight are not provided. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

DHS IT Modernization Efforts
Federal Application Development and Maintenance Contracts
Transportation Security Administration IT Operations
IT Services for Critical Infrastructure

Risk Flags

Lack of detailed performance metrics.
Limited transparency on competition specifics.
Potential for cost overruns in long-term sustainment contracts without clear benchmarks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $23.0 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. SUBJECT: APPLICATION SUPPORT TEAM (AST) (FY09 CONTRACT HSTS03-09-J-CIO502) SPEND PLAN INFORMATION BRANCH/OFFICE: OIT / SYSTEMS INNOVATION DIVISION; SPEND PLAN PORTFOLIO: APPLICATIONS DEVELOPMENT; SPEND PLAN LINE ITEM: APPLICATIONS SUPPORT TEAM (AST) THE OBJECTIVE OF THIS PROCUREMENT IS TO PROVIDE ONGOING SUSTAINMENT OF APPLICATIONS SUPPORT AND RELATED ACTIVITIES, INCLUDING LEVEL 2 APPLICATION SUPPORT, LEVEL 3 APPLICATION SUPPORT, BREAK/FIX SUPPORT, CONFIGURATION MANAGEMENT, TESTING, AN

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 $23.0 million.

What is the period of performance?

Start: 2010-02-01. End: 2013-12-03.

What specific applications are covered under the Application Support Team (AST) contract?

The provided data does not specify the exact applications covered under the Application Support Team (AST) contract. However, the contract's objective is to provide ongoing sustainment of applications support and related activities, including Level 2 and Level 3 support, break/fix, configuration management, testing, and release management. Given the awarding agency is the Department of Homeland Security (DHS) and the specific service area is the Transportation Security Administration (TSA), it is highly probable that these applications are critical to TSA's operational functions, such as passenger screening, baggage handling, cargo security, or internal administrative systems. A deeper dive into TSA's IT portfolio would be required to identify the specific systems.

How does the $23 million contract value compare to similar application support contracts within DHS or other federal agencies?

Directly comparing the $23 million contract value to similar contracts is challenging without more granular data on the scope of services, complexity of applications supported, and contract duration. However, for a nearly four-year contract (1401 days) providing comprehensive application sustainment, the average annual spend of approximately $5.9 million is within a plausible range for large federal IT support contracts. To provide a more precise benchmark, one would need to analyze contracts with similar service level agreements (SLAs), number of applications supported, and criticality levels within agencies of comparable size and mission. For instance, contracts for sustaining enterprise resource planning (ERP) systems or large-scale operational databases often command higher values due to their complexity and mission-critical nature.

What are the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract?

The provided data does not contain specific details regarding the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. Typically, application support contracts include metrics related to response times for incidents, resolution times for different severity levels of issues, system availability, patch management timeliness, and user satisfaction. The absence of this information in the summary data makes it difficult to objectively assess the contractor's performance and the overall value delivered. A thorough review of the contract's statement of work (SOW) or performance work statement (PWS) would be necessary to identify these critical performance measures.

What is IBM's track record with DHS for similar IT support services?

IBM has a long-standing history of providing a wide range of IT services to various federal agencies, including the Department of Homeland Security (DHS). While this specific contract (HSTS03-09-J-CIO502) was awarded to IBM for application support, IBM has likely held numerous other contracts with DHS and its components for IT infrastructure, software development, cybersecurity, and managed services. Assessing IBM's overall track record would involve reviewing past performance evaluations, contract awards, and any reported issues or successes on similar engagements. Without access to specific past performance reports for IBM on DHS contracts, a detailed assessment is not possible from the provided data alone.

What is the historical spending trend for Application Support Team (AST) services at DHS?

The provided data pertains to a specific contract awarded in FY09 and running through 2013. It does not offer a historical spending trend for Application Support Team (AST) services at DHS. To establish a trend, one would need to examine spending data for similar or predecessor contracts over multiple fiscal years. This would involve identifying all contracts related to application support within DHS, particularly for the TSA, and analyzing their award amounts, durations, and periods of performance. Such an analysis would reveal whether spending in this area has increased, decreased, or remained relatively stable over time, and could highlight any shifts in procurement strategies or technology adoption.

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: $23,030,168

Exercised Options: $23,030,168

Current Obligation: $23,030,168

Parent Contract

Parent Award PIID: HSTS0307ACIO925

IDV Type: BPA

Timeline