Treasury's IRS Awards $197M for Critical Function Integration Support to Deloitte

Contract Overview

Contract Amount: $197,234,461 ($197.2M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of the Treasury

Start Date: 2014-06-01

End Date: 2018-01-31

Contract Duration: 1,340 days

Daily Burn Rate: $147.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::CT::IGF FOR CRITICAL FUNCTIONS CADE 2 LONG TERM INTEGRATION SUPPORT FOR PROGRAM MANAGEMENT OPERATIONS/INTEGRATION SUPPORT

Place of Performance

Location: LANHAM, PRINCE GEORGES County, MARYLAND, 20706

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $197.2 million to DELOITTE CONSULTING LLP for work described as: IGF::CT::IGF FOR CRITICAL FUNCTIONS CADE 2 LONG TERM INTEGRATION SUPPORT FOR PROGRAM MANAGEMENT OPERATIONS/INTEGRATION SUPPORT Key points: 1. Significant contract value for long-term integration support. 2. Deloitte Consulting LLP is the sole awardee. 3. Potential risks associated with long-term sole-source contracts. 4. IT services sector, specifically Other Computer Related Services.

Value Assessment

Rating: fair

The contract value of $197.2 million over approximately 4 years appears substantial for integration support. Benchmarking against similar long-term IT integration contracts is needed to assess value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is positive for price discovery. However, the data indicates this is a delivery order, suggesting it might be part of a larger IDIQ, and the specific competition for this order needs further clarification.

Taxpayer Impact: Full and open competition generally leads to better pricing for taxpayers. The total value suggests a significant investment.

Public Impact

Ensures continuity of critical IRS functions through integrated systems. Supports program management and operational integration. Long-term nature of the contract implies ongoing reliance on external expertise.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long-term contract duration
Sole awardee for critical functions

Positive Signals

Awarded under full and open competition
Supports critical government functions

Sector Analysis

This contract falls within the IT services sector, specifically 'Other Computer Related Services'. Spending in this area is common for government agencies requiring specialized integration and program management support for complex systems.

Small Business Impact

The data indicates that small businesses were not directly involved in this specific award, as the prime contractor is Deloitte Consulting LLP. Further analysis would be needed to determine if small businesses were utilized as subcontractors.

Oversight & Accountability

Oversight of this contract would involve monitoring performance against service level agreements and ensuring adherence to the firm fixed price. The IRS should have mechanisms in place to track deliverables and manage contractor performance effectively.

Related Government Programs

Other Computer Related Services
Department of the Treasury Contracting
Internal Revenue Service Programs

Risk Flags

Long-term reliance on a single contractor for critical functions.
Potential for vendor lock-in.
Need for robust ongoing oversight to ensure continued value.
Lack of transparency on subcontractor utilization.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $197.2 million to DELOITTE CONSULTING LLP. IGF::CT::IGF FOR CRITICAL FUNCTIONS CADE 2 LONG TERM INTEGRATION SUPPORT FOR PROGRAM MANAGEMENT OPERATIONS/INTEGRATION SUPPORT

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $197.2 million.

What is the period of performance?

Start: 2014-06-01. End: 2018-01-31.

What is the specific nature of the 'critical functions' being supported by this integration contract?

The contract supports 'CRITICAL FUNCTIONS CADE 2 LONG TERM INTEGRATION SUPPORT FOR PROGRAM MANAGEMENT OPERATIONS/INTEGRATION SUPPORT'. CADE 2 likely refers to the Customer Account Data Engine 2, a major IRS modernization initiative. This integration support is crucial for ensuring the seamless operation and management of taxpayer data and related IRS processes.

What are the key performance indicators (KPIs) used to measure the success of this long-term integration support?

Specific KPIs are not detailed in the provided data. However, typical KPIs for such contracts would include system uptime, data accuracy, successful integration of new functionalities, timely completion of program management tasks, and adherence to security protocols. Regular performance reviews would assess these metrics.

How does the IRS ensure ongoing value and prevent cost overruns with a long-term, firm-fixed-price contract like this?

The IRS can ensure ongoing value through robust contract management, including regular performance reviews, milestone tracking, and scope management. While firm-fixed-price limits cost overruns for the contractor, the IRS must vigilantly oversee that the scope remains aligned with original objectives and that the services delivered meet evolving needs without scope creep.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte Financial Advisory Services LLP (UEI: 216754602)

Address: 1725 DUKE ST, ALEXANDRIA, VA, 22314

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $203,558,473

Exercised Options: $197,306,768

Current Obligation: $197,234,461

Subaward Activity

Number of Subawards: 19

Total Subaward Amount: $39,462,345

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: TIRNO11D00016

IDV Type: IDC

Timeline