Treasury's IRS Spends $99.7M on Computer Associates Software Support via Delivery Order
Contract Overview
Contract Amount: $99,734,592 ($99.7M)
Contractor: CA, Inc.
Awarding Agency: Department of the Treasury
Start Date: 2017-03-31
End Date: 2022-03-31
Contract Duration: 1,826 days
Daily Burn Rate: $54.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: IGF::CL::IGF FOR CLOSELY ASSOCIATED - COMPUTER ASSOCIATES ENTERPRISE SOFTWARE SUPPORT
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20171
State: Virginia Government Spending
Plain-Language Summary
Department of the Treasury obligated $99.7 million to CA, INC. for work described as: IGF::CL::IGF FOR CLOSELY ASSOCIATED - COMPUTER ASSOCIATES ENTERPRISE SOFTWARE SUPPORT Key points: 1. Significant spending on enterprise software support highlights reliance on established vendors. 2. Competition was full and open, suggesting potential for price discovery. 3. Risk of vendor lock-in and high maintenance costs for specialized software. 4. IT sector spending, particularly on software, is a major government expenditure area.
Value Assessment
Rating: fair
The contract value of $99.7M over five years for software support appears substantial. Benchmarking against similar enterprise software support contracts is needed to assess if the pricing is competitive, especially given the firm fixed price structure.
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 delivery order mechanism for enterprise software support might still lead to concentrated spending with a single vendor over time.
Taxpayer Impact: Taxpayer funds are being used for essential software maintenance. While competition was sought, the long-term cost-effectiveness of this specific software and support contract needs ongoing evaluation.
Public Impact
Ensures continued operation of critical IRS software systems. Supports tax processing and taxpayer services. Potential for cost savings if competitive bidding drives down support prices.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- High contract value.
- Long contract duration.
- Reliance on a single vendor for critical software.
Positive Signals
- Full and open competition.
- Firm fixed price contract type.
Sector Analysis
This contract falls within the IT sector, specifically software publishers. Government spending on enterprise software and support is a significant portion of IT budgets, often characterized by long-term contracts and specialized vendor relationships.
Small Business Impact
The data does not indicate any specific participation or set-aside for small businesses in this contract. Large enterprise software support contracts are typically awarded to major software vendors, limiting small business involvement.
Oversight & Accountability
The contract was awarded as a delivery order under a larger agreement, suggesting some level of pre-negotiation. Oversight would focus on ensuring performance metrics are met and that the pricing remains justified throughout the contract period.
Related Government Programs
- Software Publishers
- Department of the Treasury Contracting
- Internal Revenue Service Programs
Risk Flags
- High contract value.
- Long contract duration.
- Potential for vendor lock-in.
- Lack of specific small business participation.
- Need for total cost of ownership analysis.
Tags
software-publishers, department-of-the-treasury, va, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Treasury awarded $99.7 million to CA, INC.. IGF::CL::IGF FOR CLOSELY ASSOCIATED - COMPUTER ASSOCIATES ENTERPRISE SOFTWARE SUPPORT
Who is the contractor on this award?
The obligated recipient is CA, 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 $99.7 million.
What is the period of performance?
Start: 2017-03-31. End: 2022-03-31.
What is the total cost of ownership for this software, including licensing, support, and potential upgrades, over its lifecycle?
Determining the total cost of ownership requires more than just the current support contract value. It necessitates analyzing initial acquisition costs, ongoing maintenance fees, potential customization expenses, and the cost of future upgrades or replacements. Without this comprehensive view, assessing the true value and long-term financial impact on the IRS is challenging.
What is the risk of vendor lock-in and the potential cost of migrating to alternative software solutions if needed?
Vendor lock-in is a significant risk with specialized enterprise software. Migrating away from established systems like those potentially provided by Computer Associates can be extremely costly and disruptive, involving data migration, retraining staff, and integrating new systems. The current contract's value might be influenced by the perceived difficulty and expense of switching.
How effectively does this software support the IRS's core mission functions, and are there opportunities for modernization or consolidation?
The effectiveness of the software is crucial for the IRS's ability to process taxes and serve taxpayers. While this contract ensures continuity, ongoing assessment is needed to determine if the software remains the most efficient and modern solution. Opportunities for modernization or consolidating support for similar applications could lead to greater efficiency and cost savings.
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
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Contractor Details
Parent Company: CA Inc. (UEI: 081331561)
Address: 2291 WOOD OAK DR, HERNDON, VA, 20171
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $2,502,574,500
Exercised Options: $2,483,446,217
Current Obligation: $99,734,592
Actual Outlays: $50,003,057
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS35F0823M
IDV Type: FSS
Timeline
Start Date: 2017-03-31
Current End Date: 2022-03-31
Potential End Date: 2022-03-31 09:31:08
Last Modified: 2021-12-10
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