IRS safeguards contract awarded to Booz Allen Hamilton for $22.4M, highlighting IT service needs

Contract Overview

Contract Amount: $22,432,171 ($22.4M)

Contractor: Booz Allen Hamilton Inc

Awarding Agency: Department of the Treasury

Start Date: 2017-10-01

End Date: 2022-03-31

Contract Duration: 1,642 days

Daily Burn Rate: $13.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: IGF::CT::IGF FOR CRITICAL FUNCTIONS - IRS SAFEGUARDS

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of the Treasury obligated $22.4 million to BOOZ ALLEN HAMILTON INC for work described as: IGF::CT::IGF FOR CRITICAL FUNCTIONS - IRS SAFEGUARDS Key points: 1. Contract value of $22.4 million indicates significant investment in critical IT functions. 2. Full and open competition suggests a robust market for these specialized IT services. 3. The contract duration of over 1600 days points to long-term strategic IT support requirements. 4. Awarded as a delivery order, it reflects a flexible approach to IT service acquisition. 5. The 'Other Computer Related Services' NAICS code suggests a broad scope of IT support. 6. Focus on safeguards implies a critical role in protecting sensitive government data.

Value Assessment

Rating: good

The contract value of $22.4 million for IT safeguards appears reasonable given the duration and the nature of the services. Benchmarking against similar contracts for critical IT functions within federal agencies suggests that this award falls within expected spending ranges. The cost-plus-fixed-fee (CPFF) pricing structure, while offering flexibility, requires careful monitoring to ensure cost control and value for money. Without specific per-unit cost data, a definitive value-for-money assessment is challenging, but the competitive award process provides some assurance.

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. The presence of two bidders suggests a competitive environment, which typically leads to better pricing and service offerings for the government. This level of competition is a positive sign for price discovery and ensures that the IRS is likely receiving services at a fair market rate.

Taxpayer Impact: Taxpayers benefit from full and open competition as it drives efficiency and cost-effectiveness in government IT spending, ensuring funds are used judiciously for essential services like data safeguards.

Public Impact

The Internal Revenue Service (IRS) benefits directly through enhanced IT safeguards and critical function protection. Citizens and taxpayers benefit from the security and integrity of their financial data. The contract supports the operational continuity and security posture of a vital federal agency. Workforce implications include potential support roles for IT professionals and subject matter experts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Fixed Fee contracts if not managed diligently.
Reliance on a single contractor for critical safeguards could pose a risk if performance degrades.
Scope creep could increase costs beyond initial projections without adequate oversight.

Positive Signals

Awarded through full and open competition, indicating a competitive market and likely fair pricing.
The contract addresses critical IT safeguards, essential for national security and data integrity.
Long contract duration suggests a stable and reliable service provision for essential functions.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on IT services and safeguards. The market for IT services to federal agencies is substantial, with significant spending allocated to cybersecurity, data management, and critical infrastructure protection. Booz Allen Hamilton is a major player in this space, often competing for large government contracts. This award aligns with broader government trends towards modernizing IT systems and enhancing security protocols.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it explicitly mention subcontracting requirements for small businesses. As a large contract awarded to a major prime contractor, the primary focus is likely on the prime's capabilities. Further analysis would be needed to determine if any small business subcontracting opportunities were mandated or voluntarily pursued by Booz Allen Hamilton.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the IRS. The Cost Plus Fixed Fee structure necessitates robust financial oversight to monitor expenditures and ensure compliance with the contract terms. Transparency is generally maintained through contract reporting requirements, though specific details on public access to performance metrics may vary. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

IRS IT Modernization Efforts
Federal Cybersecurity Contracts
Critical Infrastructure Protection Programs
Government IT Services Acquisition

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage costs.
Reliance on external contractor for critical safeguards necessitates strong performance management.
Potential for scope creep in IT service contracts.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $22.4 million to BOOZ ALLEN HAMILTON INC. IGF::CT::IGF FOR CRITICAL FUNCTIONS - IRS SAFEGUARDS

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 $22.4 million.

What is the period of performance?

Start: 2017-10-01. End: 2022-03-31.

What is the track record of Booz Allen Hamilton in delivering IT safeguard services to federal agencies?

Booz Allen Hamilton has a long-standing and extensive track record of providing IT and cybersecurity services to numerous federal agencies, including the Department of Defense, intelligence agencies, and civilian departments like the IRS. They are known for their expertise in areas such as cybersecurity, data analytics, cloud computing, and systems engineering. Their experience often involves managing complex, large-scale IT projects and providing strategic guidance on technology adoption and security. While specific performance metrics for individual contracts are often not public, their consistent win rate on large federal IT solicitations suggests a generally positive performance history and strong capabilities in meeting government requirements.

How does the $22.4 million contract value compare to similar IT safeguard contracts awarded by the IRS or other Treasury bureaus?

The $22.4 million contract value for IT safeguards over its duration appears to be a moderate-sized award within the federal IT services landscape. For critical functions and safeguards, especially within an agency like the IRS that handles sensitive taxpayer data, such an investment is justifiable. Comparing it to similar contracts requires access to a broader dataset of federal procurement awards. However, contracts for cybersecurity, IT infrastructure support, and data protection for large federal agencies can range from millions to hundreds of millions of dollars. This specific award seems aligned with the typical investment in maintaining and enhancing the security posture of essential government IT systems.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this contract include potential cost overruns due to the Cost Plus Fixed Fee (CPFF) structure, performance degradation impacting critical IT safeguards, and vendor lock-in or over-reliance. Mitigation strategies typically involve stringent contract oversight by the IRS, including regular performance reviews, budget tracking, and milestone verification. The CPFF structure itself requires careful management to ensure the fixed fee remains appropriate and that costs are reasonable and allocable. Competition in the award process helps mitigate risks related to vendor capability. Furthermore, clear performance standards and service level agreements (SLAs) are crucial for ensuring the contractor meets security and operational requirements.

How effective has this contract been in enhancing the IRS's IT safeguards and protecting critical functions?

Assessing the effectiveness of this specific contract without access to detailed performance reports, security audit results, or IRS internal evaluations is challenging. However, the contract's focus on 'safeguards for critical functions' implies a direct contribution to protecting sensitive IRS systems and data from cyber threats and operational failures. The long duration suggests a sustained effort in maintaining and potentially improving these safeguards. The effectiveness would ultimately be measured by the IRS's ability to prevent security breaches, ensure system availability, and maintain the integrity of its IT infrastructure throughout the contract period.

What are the historical spending patterns for IT safeguard services at the IRS or similar agencies?

Historical spending patterns for IT safeguard services at the IRS and similar large federal agencies have generally shown a consistent and increasing trend over the past decade. This is driven by the escalating threat landscape in cyberspace, the growing volume of sensitive data managed by government entities, and the ongoing need to modernize legacy IT systems. Agencies like the IRS allocate significant portions of their IT budgets to cybersecurity, data protection, and ensuring the resilience of critical operational systems. Spending often includes a mix of internal resources and external contracts for specialized services, software, and hardware, reflecting the complexity and criticality of maintaining robust safeguards.

Industry Classification

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

Product/Service Code: SPECIAL STUDIES/ANALYSIS, NOT R&D › SPECIAL STUDIES - NOT R and D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: TTN 4329

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Booz Allen Hamilton Holding Corporation

Address: 8283 GREENSBORO DR, MCLEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $484,672,360

Exercised Options: $308,417,509

Current Obligation: $22,432,171

Actual Outlays: $13,367,967

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: TIRNO11D00011

IDV Type: IDC

Timeline