IRS awards $24.5M contract to General Dynamics for Modernized E-File system development

Contract Overview

Contract Amount: $24,555,366 ($24.6M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2012-09-13

End Date: 2014-11-30

Contract Duration: 808 days

Daily Burn Rate: $30.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: CRITICIAL FUNCTION - THE INTERNAL REVENUE SERVICE (IRS) REQUIRES THE SERVICES OF THE PRIME SYSTEMS INTEGRATION CONTRACTOR (PRIME) TO CONTINUE MANAGEMENT AND DEVELOPMENT FOR THE MODERNIZED E-FILE (MEF) SYSTEM INFRASTRUCTURE. THE CONTRACTOR S PRIMARY FOCUS WILL BE ON MANAGING THE DEVELOPMENT PROCESS AND DESIGNING, DEVELOPING, TESTING, AND IMPLEMENTING THE RETURN REVIEW PROGRAM (RRP) INTERFACE, THE 1041 (U.S. INCOME TAX RETURN FOR ESTATES AND TRUSTS), AND THE 94X (EMPLOYMENT/UNEMPLOYMENT TAX RETURNS) ON THE IRS ENTERPRISE ARCHITECTURE.

Place of Performance

Location: LANHAM, PRINCE GEORGES County, MARYLAND, 20706

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $24.6 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: CRITICIAL FUNCTION - THE INTERNAL REVENUE SERVICE (IRS) REQUIRES THE SERVICES OF THE PRIME SYSTEMS INTEGRATION CONTRACTOR (PRIME) TO CONTINUE MANAGEMENT AND DEVELOPMENT FOR THE MODERNIZED E-FILE (MEF) SYSTEM INFRASTRUCTURE. THE CONTRACTOR S PRIMARY FOCUS WILL BE ON MANAGING THE D… Key points: 1. Contract focuses on critical IRS systems for tax return processing. 2. General Dynamics Information Technology is the incumbent contractor. 3. Risk of system disruption if development is not managed effectively. 4. Sector is IT services, specifically computer systems design.

Value Assessment

Rating: fair

The contract value of $24.5M over two years for complex system integration appears reasonable, but without specific performance metrics or comparable contract data, a precise valuation is difficult. The Cost Plus Fixed Fee structure can lead to cost overruns if not closely monitored.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the specific details of the competition and how price discovery was achieved are not provided, making it difficult to assess if the best possible price was secured.

Taxpayer Impact: Taxpayer funds are being used for essential IRS IT infrastructure, aiming to improve tax processing efficiency. The success of this investment will ultimately benefit taxpayers through better service delivery.

Public Impact

Ensures continued operation and modernization of critical tax filing systems. Potential for improved efficiency and accuracy in tax return processing. Supports the IRS's ability to manage and implement new tax regulations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type can incentivize contractor to increase costs.
Limited information on specific performance metrics and oversight.
Potential for vendor lock-in if system becomes highly specialized.

Positive Signals

Awarded under full and open competition.
Focus on critical IRS functions ensures essential services continue.
Incumbent contractor likely possesses deep system knowledge.

Sector Analysis

This contract falls within the IT sector, specifically Computer Systems Design Services. Spending in this area is substantial across government, with benchmarks varying widely based on project complexity and scope. The $24.5M value for a two-year modernization effort is significant but not unusual for large-scale federal IT projects.

Small Business Impact

The data indicates this contract was not set aside for small businesses and the prime contractor is a large business. There is no information provided on subcontracting opportunities for small businesses within this award.

Oversight & Accountability

The contract is managed by the Internal Revenue Service, a component of the Department of the Treasury. Oversight would typically involve program managers monitoring performance, costs, and adherence to contract terms. The effectiveness of this oversight is not detailed in the provided data.

Related Government Programs

Computer Systems Design Services
Department of the Treasury Contracting
Internal Revenue Service Programs

Risk Flags

Potential for cost overruns due to CPFF contract type.
Dependency on a single prime contractor for critical system development.
Lack of detailed performance metrics in the provided data.
Risk of schedule delays impacting IRS operations.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $24.6 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. CRITICIAL FUNCTION - THE INTERNAL REVENUE SERVICE (IRS) REQUIRES THE SERVICES OF THE PRIME SYSTEMS INTEGRATION CONTRACTOR (PRIME) TO CONTINUE MANAGEMENT AND DEVELOPMENT FOR THE MODERNIZED E-FILE (MEF) SYSTEM INFRASTRUCTURE. THE CONTRACTOR S PRIMARY FOCUS WILL BE ON MANAGING THE DEVELOPMENT PROCESS AND DESIGNING, DEVELOPING, TESTING, AND IMPLEMENTING THE RETURN REVIEW PROGRAM (RRP) INTERFACE, THE 1041 (U.S. INCOME TAX RETURN FOR ESTATES AND TRUSTS), AND THE 94X (EMPLOYMENT/UNEMPLOYMENT TAX RETURN

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, 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 $24.6 million.

What is the period of performance?

Start: 2012-09-13. End: 2014-11-30.

What specific performance metrics are in place to ensure the successful development and implementation of the RRP interface and tax forms?

The provided data does not specify the performance metrics for this contract. A thorough review would require access to the contract's Statement of Work (SOW) and any associated performance work statements (PWS). These documents would detail the measurable outcomes and standards the contractor must meet for successful delivery of the system components.

How will the Cost Plus Fixed Fee structure be managed to prevent cost overruns and ensure value for taxpayer money?

Managing a Cost Plus Fixed Fee contract requires rigorous oversight from the government contracting officer and program team. This includes detailed tracking of all incurred costs, regular audits, and strict adherence to the defined scope of work. Any deviations must be formally approved, and the fixed fee ensures the contractor has an incentive to control costs within the agreed-upon parameters.

What is the IRS's contingency plan if General Dynamics Information Technology fails to meet the development deadlines or quality standards for the MEF system?

Contingency plans for critical IT projects typically involve phased rollouts, parallel development efforts, or pre-identified alternative contractors for specific components. The IRS would likely have clauses within the contract addressing remedies for non-performance, which could include termination for default and seeking damages, or potentially bringing in another vendor to complete the work.

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: FULL AND OPEN COMPETITION

Solicitation ID: RFP 085

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Parent Company: Csra LLC (UEI: 080011988)

Address: MARYLAND TECHNOLOGY CENTER, LANHAM, MD, 20706

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $27,815,817

Exercised Options: $27,769,793

Current Obligation: $24,555,366

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: TIRNO99D00001

IDV Type: IDC

Timeline