Treasury's $36M IT contract with Booz Allen Hamilton for computer systems design services awarded in 2009

Contract Overview

Contract Amount: $36,097,441 ($36.1M)

Contractor: Booz Allen Hamilton Inc.

Awarding Agency: Department of the Treasury

Start Date: 2009-05-26

End Date: 2014-08-01

Contract Duration: 1,893 days

Daily Burn Rate: $19.1K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: TIPPS 3 CONTRACT W/BAH

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of the Treasury obligated $36.1 million to BOOZ ALLEN HAMILTON INC. for work described as: TIPPS 3 CONTRACT W/BAH Key points: 1. Contract awarded to a large, established firm with significant federal contracting experience. 2. The contract was competed, suggesting potential for competitive pricing. 3. The duration of the contract (over 5 years) indicates a long-term need for these services. 4. The fixed-price contract type shifts some risk to the contractor. 5. The services fall under computer systems design, a common IT requirement for government agencies. 6. The contract was awarded to a prime contractor, with no specific small business set-aside mentioned.

Value Assessment

Rating: good

The contract's total value of approximately $36 million over its 5-year period represents a significant investment in IT services. Benchmarking this against similar large-scale IT system design contracts within the federal government would provide a clearer picture of its value. The firm-fixed-price structure suggests that the contractor assumed the risk for cost overruns, which can be a positive indicator of value if the project was completed within budget. However, without detailed performance metrics or cost breakdowns, a definitive value-for-money assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a competitive delivery order, indicating that it was part of a larger, competed vehicle. The presence of 6 bidders suggests a healthy level of competition for this specific task order. A competitive process generally leads to better price discovery and ensures that the government receives proposals from multiple qualified vendors, fostering a more efficient allocation of resources.

Taxpayer Impact: The competitive nature of this award is beneficial for taxpayers as it likely resulted in a more favorable price compared to a sole-source or limited competition scenario.

Public Impact

The primary beneficiaries are the Department of the Treasury and the Internal Revenue Service, receiving essential IT systems design services. The services delivered likely supported the modernization or maintenance of critical IRS IT infrastructure. The geographic impact is primarily within Virginia, where the contractor is located and services were likely performed. The contract supported skilled IT professionals within Booz Allen Hamilton, contributing to the federal IT workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in long-term IT system design contracts if not managed tightly.
Reliance on a single large contractor for critical IT functions could pose a risk if performance falters.
The complexity of IT systems design can lead to unforeseen technical challenges and potential delays.

Positive Signals

Awarded through a competitive process, indicating multiple vendors vied for the work.
Firm-fixed-price contract type aligns contractor incentives with cost control.
Booz Allen Hamilton is a well-established contractor with a strong track record in federal IT services.
The contract duration suggests a stable, ongoing need that the contractor is positioned to meet.

Sector Analysis

This contract falls within the Computer Systems Design Services sector, a critical component of the IT industry. This sector encompasses a wide range of activities, from custom software development to IT infrastructure management. The federal government is a major consumer of these services, with spending often driven by the need to modernize legacy systems, enhance cybersecurity, and improve operational efficiency. Comparable spending benchmarks for IT system design services can vary widely based on project complexity, duration, and the specific technologies involved.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). Booz Allen Hamilton is a large prime contractor. While this specific award doesn't directly benefit small businesses through a set-aside, large prime contractors often engage small businesses as subcontractors. The extent of subcontracting would be a key factor in assessing the broader impact on the small business ecosystem for this contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the Department of the Treasury's Internal Revenue Service. Performance reviews, regular reporting, and adherence to contract terms would be key accountability measures. Transparency is generally maintained through contract databases like FPDS-NG, which provide public access to award details. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

IRS IT Modernization Programs
Treasury Department IT Services
General Services Administration (GSA) IT Schedule Contracts
Computer Systems Design Services Federal Spending

Risk Flags

Long-term IT contract duration requires sustained oversight.
Complexity of system design can lead to unforeseen issues.
Reliance on a single large contractor for critical functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $36.1 million to BOOZ ALLEN HAMILTON INC.. TIPPS 3 CONTRACT W/BAH

Who is the contractor on this award?

The obligated recipient is BOOZ ALLEN HAMILTON INC..

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $36.1 million.

What is the period of performance?

Start: 2009-05-26. End: 2014-08-01.

What was Booz Allen Hamilton's performance history on similar federal IT system design contracts prior to and during this award period?

Booz Allen Hamilton has a long and extensive history as a federal contractor, particularly in the IT and management consulting space. Prior to and during the period of this contract (2009-2014), the firm was a major player, holding numerous large-scale IT contracts across various civilian and defense agencies. Their track record generally includes experience in complex system design, integration, and modernization efforts. Specific performance metrics for individual contracts are often not publicly detailed, but their continued success in winning competitive bids suggests a generally positive performance history. However, like any large contractor, they have also faced scrutiny and occasional performance issues on specific projects, which would require a deeper dive into individual contract performance reports if available.

How does the per-hour billing rate or total cost compare to industry benchmarks for similar computer systems design services during the 2009-2014 period?

Determining precise per-hour billing rates or comparing the total cost to industry benchmarks for this specific contract is challenging without access to the detailed contract line-item data and the specific labor categories involved. Federal IT contracts, especially those awarded under large IDIQ vehicles, can have complex pricing structures. Booz Allen Hamilton, as a large, established firm, typically commands rates at the higher end of the market due to its expertise and overhead. However, the competitive nature of the award and the firm-fixed-price structure suggest an effort to control costs. To perform a robust benchmark, one would need to compare the negotiated rates for specific labor categories (e.g., senior systems architect, junior developer) against GSA Schedule rates or other publicly available benchmark data for similar services during that timeframe.

What were the primary risks identified for this contract, and how were they mitigated?

For a contract of this nature (large-scale IT system design over several years), common risks include technical challenges in integrating new systems with legacy infrastructure, potential for scope creep as requirements evolve, contractor performance issues, and cybersecurity vulnerabilities. Given the firm-fixed-price structure, a primary risk for the contractor would be cost overruns if the project scope expanded or technical hurdles proved more difficult than anticipated. Mitigation strategies would likely involve rigorous project management, clear definition and control of scope, regular performance reviews, robust testing and quality assurance processes, and strong cybersecurity protocols implemented by both the contractor and the agency. The agency's oversight would be crucial in identifying and addressing risks proactively.

What was the overall effectiveness of the computer systems designed or implemented under this contract for the IRS?

Assessing the overall effectiveness of the computer systems designed or implemented under this contract requires specific performance data and user feedback related to the IRS systems that were supported. Without access to post-implementation reviews, system uptime statistics, user satisfaction surveys, or metrics on improved processing times or efficiency gains, it's impossible to definitively state the contract's effectiveness. The fact that the contract was awarded competitively and fulfilled over its duration suggests a baseline level of success. However, true effectiveness would be measured by how well the new or updated systems met the IRS's operational needs, improved taxpayer services, or enhanced internal processes.

How has federal spending on computer systems design services, particularly by the IRS and Treasury, trended before, during, and after this contract period?

Federal spending on computer systems design services, especially by large agencies like the IRS and Treasury, has generally seen an upward trend over the past two decades, driven by the increasing reliance on technology and the need to modernize aging IT infrastructure. During the 2009-2014 period (when this contract was active), government-wide IT spending was substantial, often focused on efficiency improvements and security enhancements. Post-2014, there has been a continued emphasis on digital transformation, cloud adoption, and cybersecurity, likely leading to sustained or increased spending in this category. The IRS, in particular, has faced significant challenges with its legacy systems, necessitating ongoing investments in IT modernization, which would reflect in its spending patterns for computer systems design services.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

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

Competition & Pricing

Extent Competed: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Booz Allen Hamilton Holding Corporation (UEI: 964725688)

Address: 1953 GALLOWS RD STE 600, VIENNA, VA, 11

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $36,103,949

Exercised Options: $36,103,949

Current Obligation: $36,097,441

Parent Contract

Parent Award PIID: TIRNO06D00026

IDV Type: IDC

Timeline