IBM SRO Recompete Contract Awarded to Four LLC for Over $180M by SSA

Contract Overview

Contract Amount: $180,555,525 ($180.6M)

Contractor: Four LLC

Awarding Agency: Social Security Administration

Start Date: 2011-12-31

End Date: 2014-12-30

Contract Duration: 1,095 days

Daily Burn Rate: $164.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IBM SRO RECOMPETE

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20814

State: Maryland Government Spending

Plain-Language Summary

Social Security Administration obligated $180.6 million to FOUR LLC for work described as: IBM SRO RECOMPETE Key points: 1. Contract value of $180.5M over three years suggests significant investment in software publishing services. 2. Awarded under full and open competition, indicating a potentially competitive bidding process. 3. The firm-fixed-price contract type aims to control costs and provide predictable spending. 4. The contract duration of 1095 days (3 years) allows for sustained service delivery. 5. The primary NAICS code 511210 points to a focus on software publishing. 6. The contract was awarded as a delivery order, suggesting it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar framework.

Value Assessment

Rating: fair

Benchmarking the value of this $180.5 million contract for software publishing is challenging without specific service details or comparable contract data. The firm-fixed-price structure is generally favorable for cost control. However, the absence of detailed performance metrics or comparisons to similar large-scale software publishing contracts makes a definitive value assessment difficult. The price per year is approximately $60 million, which, while substantial, needs to be evaluated against the scope and criticality of the software services provided.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION,' suggesting that all responsible sources were permitted to submit a bid. The presence of two bidders (no: 2) indicates some level of competition, but it is on the lower end for a contract of this magnitude. A higher number of bidders typically leads to more competitive pricing and a wider range of innovative solutions. The limited number of bidders here might suggest a specialized market or high barriers to entry.

Taxpayer Impact: For taxpayers, full and open competition is generally beneficial as it aims to secure the best value through market forces. However, with only two bidders, the potential for significant cost savings might be constrained compared to a more robustly competed contract.

Public Impact

The Social Security Administration (SSA) is the primary beneficiary, receiving software publishing services. The contract supports the ongoing operations and technological needs of the SSA. The geographic impact is primarily within Maryland (ST: MD), where the contractor is located. The contract likely supports a workforce involved in software development, maintenance, and publishing.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (2 bidders) may have restricted price discovery and potentially led to a higher-than-optimal price.
Lack of detailed service scope makes it difficult to assess if the $180.5M represents optimal value for money.
The contract is a delivery order, implying it might be part of a larger, potentially less scrutinized, contracting vehicle.

Positive Signals

Firm-fixed-price contract type provides cost certainty for the government.
Full and open competition, even with limited bidders, is a positive sign for market engagement.
The contract duration allows for stable service provision to the SSA.

Sector Analysis

The software publishing industry is a significant segment of the technology sector, encompassing the development, marketing, and distribution of software. This contract falls within the IT services and software development sub-sector. The market for government IT services is vast, with agencies increasingly relying on external vendors for specialized software solutions. Benchmarking this contract's value against industry averages for similar large-scale software projects would require detailed service specifications, but $180.5 million over three years represents a substantial investment.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Consequently, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. The primary contractor, FOUR LLC, is likely a large business, and the contract's scale suggests it is not geared towards small business participation unless explicitly mandated through subcontracting goals, which are not detailed here.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officers and program managers within the Social Security Administration. Accountability measures are inherent in the firm-fixed-price structure, which obligates the contractor to deliver specific services within the agreed budget. Transparency is facilitated by the public availability of contract award data. The extent of Inspector General (IG) involvement would depend on any audits, investigations, or specific concerns raised regarding performance or financial integrity.

Related Government Programs

Software Development Services
IT Services for Government Agencies
Cloud Computing Services
Data Management Solutions
Cybersecurity Services

Risk Flags

Limited Competition
Lack of Detailed Service Scope
Potential for Scope Creep in FFP Contracts

Frequently Asked Questions

What is this federal contract paying for?

Social Security Administration awarded $180.6 million to FOUR LLC. IBM SRO RECOMPETE

Who is the contractor on this award?

The obligated recipient is FOUR LLC.

Which agency awarded this contract?

Awarding agency: Social Security Administration (Social Security Administration).

What is the total obligated amount?

The obligated amount is $180.6 million.

What is the period of performance?

Start: 2011-12-31. End: 2014-12-30.

What specific software publishing services does FOUR LLC provide under this contract?

The provided data does not specify the exact nature of the software publishing services rendered by FOUR LLC. The NAICS code 511210, 'Software Publishers,' broadly covers the development, marketing, and distribution of software. For this contract, it could encompass a wide range of activities such as custom software development, software maintenance and support, licensing of proprietary software, or the development and deployment of new software applications critical to the Social Security Administration's operations. Without further details on the Statement of Work (SOW), it is impossible to ascertain the precise services.

How does the $180.5 million contract value compare to similar software publishing contracts awarded by the SSA or other large federal agencies?

Direct comparison of the $180.5 million contract value is difficult without knowing the specific scope and duration of services. However, for a three-year period, this represents an average annual expenditure of approximately $60 million. Large federal agencies, particularly those with significant IT infrastructure needs like the SSA, often award multi-million dollar contracts for software development and publishing. Contracts of this size are typical for major system overhauls, ongoing support for critical legacy systems, or the development of new, large-scale software platforms. A more precise comparison would require identifying contracts with similar NAICS codes, service descriptions, and agency missions.

What are the key performance indicators (KPIs) used to evaluate FOUR LLC's performance under this contract?

The provided contract data does not include specific Key Performance Indicators (KPIs) for this contract. Typically, for software publishing and development contracts, KPIs might include metrics such as software defect rates, on-time delivery of milestones, system uptime and availability, user satisfaction, adherence to security protocols, and successful implementation of new features or updates. The effectiveness of oversight and performance evaluation would depend on the detailed Service Level Agreements (SLAs) and performance standards established within the contract's Statement of Work (SOW), which are not publicly available in this dataset.

What is the historical spending pattern for software publishing services by the Social Security Administration?

Analyzing the historical spending patterns for software publishing by the Social Security Administration (SSA) requires access to historical contract databases and budget allocations. This single contract award of $180.5 million provides a snapshot for the period between late 2011 and late 2014. To understand broader trends, one would need to examine spending across multiple fiscal years, identify other major software contracts awarded by the SSA, and assess whether spending has increased or decreased over time, potentially correlating with technological modernization efforts or shifts in IT strategy.

What are the potential risks associated with a firm-fixed-price contract of this magnitude for software publishing?

While firm-fixed-price (FFP) contracts offer cost certainty, risks can still arise, especially for complex software projects. For a contract of this magnitude ($180.5M), potential risks include scope creep if requirements are not clearly defined upfront, leading to potential disputes or change orders. The contractor might be incentivized to cut corners on quality to maximize profit if oversight is insufficient. Furthermore, if the initial price was set too low due to competitive pressures, the contractor might struggle to deliver the full scope, potentially impacting performance or leading to contract termination. The limited competition (2 bidders) could also mean the fixed price doesn't fully reflect the market's true cost.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: SSA-RFQ-12-1102

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 15413 SNOWHILL LN, CENTREVILLE, VA, 20120

Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $180,555,525

Exercised Options: $180,555,525

Current Obligation: $180,555,525

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS35F0312U

IDV Type: FSS

Timeline