VA's $95M VBMS Core/Correspondence contract awarded to Booz Allen Hamilton for IT support

Contract Overview

Contract Amount: $95,166,687 ($95.2M)

Contractor: Booz Allen Hamilton Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2016-08-23

End Date: 2018-03-19

Contract Duration: 573 days

Daily Burn Rate: $166.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::OT::IGF VBMS CORE/CORRESPONDENCE CONSOLIDATION DEVELOPMENT AND OPERATIONAL SUPPORT TASK ORDER.

Place of Performance

Location: RED BANK, MONMOUTH County, NEW JERSEY, 07701

State: New Jersey Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $95.2 million to BOOZ ALLEN HAMILTON INC for work described as: IGF::OT::IGF VBMS CORE/CORRESPONDENCE CONSOLIDATION DEVELOPMENT AND OPERATIONAL SUPPORT TASK ORDER. Key points: 1. Contract provides IT development and operational support for the Veterans Benefits Management System (VBMS). 2. The contract was awarded using full and open competition, suggesting a competitive bidding process. 3. The fixed-price contract type aims to control costs by establishing a set price for services. 4. The duration of the contract is approximately 1.5 years, indicating a medium-term project. 5. The award was made by the Department of Veterans Affairs, a major federal agency. 6. The contract falls under Computer Systems Design Services, a key IT sector.

Value Assessment

Rating: good

The contract's value of $95.17 million for a 1.5-year duration for IT development and support appears reasonable within the context of large-scale federal IT projects. Benchmarking against similar contracts for enterprise system development and maintenance would provide a more precise value-for-money assessment. The firm fixed-price structure suggests an expectation of cost control by the agency. Without specific performance metrics or comparison data, a definitive assessment of excellence is difficult, but the pricing appears within a plausible range for the scope of work.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 4 bids suggests a moderate level of competition for this significant IT support task order. A higher number of bidders might typically lead to more aggressive pricing, but the fixed-price nature of the contract already aims to cap costs. The competition level here likely ensured a fair market price was achieved.

Taxpayer Impact: Taxpayers benefit from the competitive process which helps ensure that the awarded price reflects a reasonable market rate for the services provided, preventing potential overspending on critical IT infrastructure.

Public Impact

Veterans benefit indirectly through improved functionality and support for the VBMS, which is crucial for processing benefits. The contract delivers essential IT development and operational support services for a core government system. The geographic impact is national, as the VBMS serves veterans across the United States. Workforce implications include IT professionals employed by Booz Allen Hamilton and potentially subcontractors, contributing to the federal IT workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in IT development projects, requiring diligent oversight.
Reliance on a single contractor for critical operational support could pose a risk if performance falters.
The complexity of integrating new development with existing operational systems requires careful management.

Positive Signals

Awarded through full and open competition, indicating a robust selection process.
Firm fixed-price contract type provides cost certainty for the government.
Booz Allen Hamilton is a large, established contractor with significant experience in federal IT services.

Sector Analysis

This contract falls within the Computer Systems Design Services sector, a vital component of the broader Information Technology industry. This sector involves designing, developing, and implementing computer systems, including software, hardware, and network infrastructure. Federal spending in IT services is substantial, driven by the need to modernize legacy systems, enhance cybersecurity, and improve service delivery. Comparable spending benchmarks would involve analyzing other large-scale IT system development and support contracts within federal agencies, particularly those focused on enterprise resource planning or case management systems.

Small Business Impact

This contract does not appear to have a specific small business set-aside. As a large contract awarded to a major prime contractor, the primary impact on small businesses would likely be through subcontracting opportunities. The extent to which Booz Allen Hamilton engages small businesses for specialized IT services or support roles will determine the direct benefit to the small business ecosystem. Without specific subcontracting plans or goals outlined, it's difficult to quantify the precise impact.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Veterans Affairs contracting officers and program managers. They are responsible for monitoring performance, ensuring compliance with contract terms, and managing any modifications or issues that arise. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract were suspected or identified.

Related Government Programs

Veterans Affairs IT Modernization Programs
Veterans Benefits Administration Systems
Federal Civilian IT Services
Enterprise Resource Planning (ERP) Systems Support
Case Management System Development

Risk Flags

Potential for vendor lock-in
Performance degradation risk
Knowledge transfer challenges

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $95.2 million to BOOZ ALLEN HAMILTON INC. IGF::OT::IGF VBMS CORE/CORRESPONDENCE CONSOLIDATION DEVELOPMENT AND OPERATIONAL SUPPORT TASK ORDER.

Who is the contractor on this award?

The obligated recipient is BOOZ ALLEN HAMILTON INC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $95.2 million.

What is the period of performance?

Start: 2016-08-23. End: 2018-03-19.

What is the historical spending trend for VBMS core/correspondence support by the Department of Veterans Affairs?

Analyzing historical spending for VBMS core/correspondence support requires examining past contracts and task orders related to this specific system. Prior to this $95.17 million award, the VA likely had other contracts in place for the development, maintenance, and operational support of the VBMS. These could include smaller, incremental development efforts, sustainment contracts, or broader IT support vehicles under which VBMS work was performed. Understanding the trend would involve looking at the total obligated amounts year-over-year for similar services, identifying any significant increases or decreases in spending that might correlate with system upgrades, new feature rollouts, or shifts in operational requirements. Without access to detailed historical contract data specifically for VBMS support, it's challenging to provide precise figures, but federal IT spending for large systems typically shows consistent investment with potential spikes during major modernization phases.

How does the cost per year of this contract compare to similar IT system development and support contracts within the federal government?

This contract, valued at approximately $95.17 million over roughly 1.5 years (573 days), translates to an approximate annual cost of $63.44 million. To benchmark this effectively, we need to compare it to similar federal IT contracts for the development and operational support of large-scale enterprise systems. Contracts for systems like ERPs, large case management platforms, or core IT infrastructure management within agencies like the Department of Defense, HHS, or GSA would serve as relevant comparisons. Factors such as the complexity of the system, the specific services required (e.g., pure development vs. ongoing operations and maintenance), the labor mix, and the level of competition influence cost. If similar contracts for comparable systems are in the range of $50-80 million annually, then this contract appears to be within a reasonable market range. However, a detailed analysis would require identifying specific comparable contracts and adjusting for differences in scope, duration, and service level agreements.

What are the key performance indicators (KPIs) used to measure the success of this contract, and how has Booz Allen Hamilton performed against them?

Key Performance Indicators (KPIs) for IT development and operational support contracts typically include metrics related to system uptime, response times for critical functions, defect resolution rates, on-time delivery of new features or modules, and user satisfaction. For the VBMS Core/Correspondence Consolidation contract, specific KPIs would likely be defined in the Performance Work Statement (PWS). Examples might include achieving 99.9% system availability, resolving high-priority bugs within 24 hours, and delivering planned development sprints on schedule. Measuring Booz Allen Hamilton's performance against these KPIs would involve reviewing contract performance reports, quality assurance surveillance plans (QASP), and potentially user feedback. Without access to these specific performance reports, it's impossible to definitively state how well the contractor has performed. However, the continued operation and potential evolution of the VBMS suggest that performance has been adequate to meet the VA's needs.

What is the track record of Booz Allen Hamilton in delivering similar large-scale IT support contracts for federal agencies?

Booz Allen Hamilton has a long and extensive track record of delivering large-scale IT support and system development services to numerous federal agencies, including the Department of Veterans Affairs. They are a major government contractor with significant expertise in areas such as systems engineering, software development, cybersecurity, and IT modernization. Past performance on contracts for other agencies, particularly those involving complex enterprise systems or mission-critical applications, would be indicative of their capabilities. While specific details of past performance on VA contracts would require a deeper dive into contract databases and performance reviews, Booz Allen Hamilton's general reputation and market position suggest they possess the resources and experience necessary for a contract of this nature. Their ability to win and execute large, complex federal IT contracts is well-established.

What are the potential risks associated with relying on a single contractor for the operational support of a critical system like VBMS?

Relying on a single contractor, even a reputable one like Booz Allen Hamilton, for the operational support of a critical system like the Veterans Benefits Management System (VBMS) presents several potential risks. One primary risk is vendor lock-in, where the agency becomes heavily dependent on the contractor's proprietary knowledge and processes, making it difficult and costly to switch providers. Another risk is performance degradation; if the contractor's performance declines due to internal issues, staffing problems, or lack of motivation, the critical system's functionality could be severely impacted, affecting veterans' benefits. There's also the risk of knowledge loss if key personnel leave the contractor's employ. Furthermore, a sole reliance can reduce competitive pressure, potentially leading to complacency and less incentive for innovation or cost efficiency over the long term. Robust contract management, clear performance standards, and contingency planning are crucial to mitigate these risks.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Booz Allen Hamilton Holding Corporation

Address: 141 W FRONT ST, RED BANK, NJ, 07701

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

Financial Breakdown

Contract Ceiling: $120,254,791

Exercised Options: $95,166,687

Current Obligation: $95,166,687

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $24,500,000

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: VA11816D1007

IDV Type: IDC

Timeline