Treasury's IRS awarded $242.6M for software, with Presidio Networked Solutions as prime contractor

Contract Overview

Contract Amount: $242,644,042 ($242.6M)

Contractor: Presidio Networked Solutions, LLC

Awarding Agency: Department of the Treasury

Start Date: 2007-09-29

End Date: 2014-09-30

Contract Duration: 2,558 days

Daily Burn Rate: $94.9K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SOFTWARE RELATIONSHIP OFFER

Place of Performance

Location: HYATTSVILLE, PRINCE GEORGES County, MARYLAND, 20784

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $242.6 million to PRESIDIO NETWORKED SOLUTIONS, LLC for work described as: SOFTWARE RELATIONSHIP OFFER Key points: 1. The contract value represents a significant investment in IT infrastructure for the IRS. 2. Competition dynamics for this delivery order are not fully detailed but indicate a competitive process. 3. The contract duration of over 7 years suggests a long-term need for these software services. 4. The firm-fixed-price contract type aims to control costs for the government. 5. The award falls within the broader category of computer and software retail. 6. The contract was awarded as a delivery order under a larger contract vehicle.

Value Assessment

Rating: fair

Benchmarking the value of this specific delivery order is challenging without knowing the underlying contract vehicle and the specific software procured. However, a $242.6 million spend over seven years for IT software solutions is substantial. The firm-fixed-price structure suggests an attempt to manage cost certainty. Further analysis would require comparing the unit costs of the software and services to market rates and similar government procurements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded as a competitive delivery order, indicating that multiple vendors had the opportunity to bid. The presence of three bidders suggests a reasonable level of competition for this specific order. A competitive process generally leads to better price discovery and potentially more favorable terms for the government compared to sole-source or limited competition awards.

Taxpayer Impact: The competitive nature of this award is beneficial for taxpayers, as it likely resulted in a more efficient use of funds and potentially lower pricing than if it had been awarded without robust competition.

Public Impact

The Internal Revenue Service (IRS) is the primary beneficiary, receiving essential software solutions. These software solutions are critical for the IRS's operational efficiency and tax administration. The geographic impact is national, supporting the IRS's nationwide operations. The contract supports the IT workforce involved in software development, implementation, and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if the software becomes deeply integrated and difficult to replace.
Risk of cost overruns if the scope of work expands beyond the initial delivery order.
Dependence on a single contractor for critical software infrastructure could pose operational risks.

Positive Signals

The firm-fixed-price contract type helps mitigate cost uncertainty.
The competitive award process suggests a focus on achieving value for money.
The long contract duration indicates a stable and ongoing need, allowing for strategic IT planning.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on software procurement and related services. The IT sector is a major area of federal spending, with agencies constantly seeking to modernize their systems. The market for enterprise software solutions is large and diverse, with numerous vendors competing for government contracts. This award represents a significant portion of spending within the computer and software retail sub-sector for the IRS.

Small Business Impact

Information regarding small business set-asides or subcontracting plans for this specific delivery order was not provided in the data. Without this information, it's difficult to assess the direct impact on the small business ecosystem. However, as a competitive award, there's always a possibility for small businesses to participate as subcontractors to the prime contractor, Presidio Networked Solutions.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program officials within the Department of the Treasury's Internal Revenue Service. The firm-fixed-price nature of the contract provides a degree of cost control. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

IRS IT Modernization Programs
Federal Enterprise Software Licenses
Department of the Treasury IT Contracts
General Services Administration (GSA) Schedule Contracts

Risk Flags

Lack of specific software details hinders in-depth analysis.
Absence of performance metrics makes value assessment difficult.
No data on contract modifications limits understanding of scope evolution.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $242.6 million to PRESIDIO NETWORKED SOLUTIONS, LLC. SOFTWARE RELATIONSHIP OFFER

Who is the contractor on this award?

The obligated recipient is PRESIDIO NETWORKED SOLUTIONS, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $242.6 million.

What is the period of performance?

Start: 2007-09-29. End: 2014-09-30.

What specific software or IT services were procured under this delivery order?

The provided data indicates the contract is for 'SOFTWARE RELATIONSHIP OFFER' and falls under the NAICS code 443120 (Computer and Software Stores). However, the specific nature of the software or IT services is not detailed. This could range from operating systems, application software, cybersecurity solutions, or IT support services. Understanding the exact nature of the procurement is crucial for a comprehensive value assessment and risk analysis. Without this detail, it's difficult to benchmark against specific software categories or market trends.

How does the $242.6 million contract value compare to other similar IRS software procurements over a similar timeframe?

Comparing this $242.6 million contract value to other IRS software procurements requires access to historical IRS spending data. However, for a large agency like the IRS, managing complex tax systems, such a figure over a seven-year period is not unusual for significant IT investments. Agencies often consolidate software needs through large contracts to achieve economies of scale. To provide a precise comparison, one would need to analyze the IRS's IT budget and contract awards for similar software categories (e.g., enterprise resource planning, tax processing software, data analytics platforms) awarded between 2007 and 2014.

What is the track record of Presidio Networked Solutions in delivering large-scale IT contracts for federal agencies, particularly the IRS?

Presidio Networked Solutions is a significant IT solutions provider with a history of federal contracting. Their track record includes numerous awards across various agencies, often involving hardware, software, and related services. For the IRS specifically, their involvement in a $242.6 million contract over seven years suggests a capacity to handle substantial IT requirements. A deeper dive into their past performance on similar contracts, including client satisfaction, on-time delivery, and adherence to budget, would be necessary to fully assess their reliability for this specific 'SOFTWARE RELATIONSHIP OFFER'.

What were the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract?

The provided data does not specify the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. For a software-related contract of this magnitude and duration, typical KPIs might include software uptime, system performance metrics, response times for technical support, patch deployment frequency, and data security compliance. SLAs would define the guaranteed levels of service and potential penalties for non-compliance. These details are crucial for evaluating the contractor's performance and the overall value delivered to the IRS.

Were there any significant contract modifications or change orders during the contract's performance period (2007-2014)?

The provided data does not include information on contract modifications or change orders. For a seven-year contract, it is common for modifications to occur due to evolving technological needs, changes in agency requirements, or unforeseen issues. Analyzing contract modifications would reveal how the scope, cost, and timeline of the 'SOFTWARE RELATIONSHIP OFFER' evolved. Significant increases in cost or scope through modifications could indicate potential issues with initial planning or execution, while adjustments for technological advancements might be expected.

What is the estimated total cost of ownership (TCO) for the software procured, considering maintenance, support, and potential upgrades over its lifecycle?

The provided data only details the award amount ($242.6 million) and contract duration (2007-2014). It does not offer insights into the Total Cost of Ownership (TCO) beyond the initial procurement value. TCO would encompass not only the initial purchase price but also ongoing costs such as software maintenance fees, technical support contracts, potential hardware infrastructure upgrades required to run the software, personnel training, and future upgrade licensing. A comprehensive TCO analysis is essential for understanding the true long-term financial commitment associated with this software investment.

Industry Classification

NAICS: Retail Trade › Electronics and Appliance Stores › Computer and Software Stores

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Presidio, Inc. (UEI: 799064451)

Address: 5100 PHILADELPHIA WAY J, LANHAM, MD, 20706

Business Categories: Category Business, Small Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $375,625,924

Exercised Options: $251,787,601

Current Obligation: $242,644,042

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F4554G

IDV Type: FSS

Timeline