DOJ awards IBM $12.9M for IT software maintenance and overhaul under CIOSP3

Contract Overview

Contract Amount: $12,902,682 ($12.9M)

Contractor: International Business Machines Corporation

Awarding Agency: Department of Justice

Start Date: 2023-09-29

End Date: 2026-09-29

Contract Duration: 1,096 days

Daily Burn Rate: $11.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: TO UNDER NITAAC'S CIOSP3 - MAINTENANCE, REPAIR AND OVERHAUL IT SOFTWARE

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20817

State: Maryland Government Spending

Plain-Language Summary

Department of Justice obligated $12.9 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: TO UNDER NITAAC'S CIOSP3 - MAINTENANCE, REPAIR AND OVERHAUL IT SOFTWARE Key points: 1. Contract awarded to a single, large incumbent vendor. 2. Pricing structure is firm-fixed-price, offering cost certainty. 3. Performance period extends over three years, indicating a need for sustained support. 4. The contract falls under a broad IT services vehicle, suggesting potential for future task orders. 5. Focus on maintenance, repair, and overhaul points to supporting existing IT infrastructure. 6. No small business set-aside was utilized for this specific award.

Value Assessment

Rating: fair

The contract's value of $12.9 million over three years for IT software maintenance and overhaul appears reasonable given the scope. However, without specific details on the services provided or comparable task orders under the CIOSP3 vehicle, a precise value-for-money assessment is challenging. Benchmarking against similar maintenance contracts for large enterprise software would provide better context. The firm-fixed-price structure helps manage cost predictability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under the NITAAC CIOSP3, a Government-Wide Acquisition Contract (GWAC) that allows for full and open competition. While the specific number of bidders for this particular delivery order is not provided, the nature of GWACs generally encourages a competitive environment. The use of a broad IDIQ vehicle like CIOSP3 aims to streamline procurement while still allowing agencies to solicit proposals from multiple qualified vendors.

Taxpayer Impact: Full and open competition on GWACs like CIOSP3 generally benefits taxpayers by fostering a competitive marketplace, driving down prices, and ensuring that the government receives the best value through a wide selection of qualified contractors.

Public Impact

The Department of Justice, specifically the Drug Enforcement Administration, will benefit from continued IT software support. Services include maintenance, repair, and overhaul of IT software, ensuring operational continuity. The contract is managed in Maryland, suggesting a primary geographic impact in that region for service delivery or oversight. IBM, a large technology corporation, will be the primary contractor, impacting its workforce and revenue.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in due to reliance on a single large incumbent for critical IT maintenance.
Lack of transparency on specific performance metrics and service level agreements for this delivery order.
Firm-fixed-price contracts can sometimes lead to scope creep if not managed carefully, potentially increasing costs beyond initial estimates.
Limited visibility into the specific software systems being maintained without further details.

Positive Signals

Awarded under a pre-competed GWAC (CIOSP3), indicating vendor qualification and streamlined acquisition.
Firm-fixed-price contract provides cost certainty for the agency.
Long-term performance period suggests a stable and reliable support arrangement.
IBM's established track record in IT services may indicate a lower risk of performance failure.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on IT software maintenance and support services. The market for IT maintenance and overhaul is substantial, driven by the continuous need to update, secure, and operate complex software systems within government agencies. The CIOSP3 GWAC itself represents a significant portion of federal IT spending, enabling agencies to procure a wide range of IT solutions. This contract's value is modest within the broader context of federal IT spending but is significant for the specific services provided to the DEA.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting requirements for small businesses indicated in the provided data. The award to IBM, a large corporation, suggests that the primary focus was on technical capability and existing contract vehicles rather than promoting small business participation for this specific task order. Future opportunities for small businesses might exist through subcontracting if IBM chooses to engage them, but this is not guaranteed.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers within the Department of Justice and the Drug Enforcement Administration. As a delivery order under the NITAAC CIOSP3 GWAC, the overarching contract vehicle itself has established oversight mechanisms. Transparency is facilitated through contract databases like FPDS, where award details are recorded. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

NITAAC CIOSP3
IT Software Maintenance
Computer Systems Design Services
Department of Justice IT Contracts
Drug Enforcement Administration Procurement

Risk Flags

Potential for vendor lock-in
Limited transparency on specific performance metrics
Risk of scope creep in firm-fixed-price contracts
Reliance on incumbent vendor for critical IT functions

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $12.9 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. TO UNDER NITAAC'S CIOSP3 - MAINTENANCE, REPAIR AND OVERHAUL IT SOFTWARE

Who is the contractor on this award?

The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Justice (Drug Enforcement Administration).

What is the total obligated amount?

The obligated amount is $12.9 million.

What is the period of performance?

Start: 2023-09-29. End: 2026-09-29.

What is IBM's track record with the Department of Justice and specifically the DEA for similar IT maintenance contracts?

IBM has a long history of providing IT services to various government agencies, including the Department of Justice and its components like the DEA. Analyzing past performance data from FPDS-NG would reveal the extent and nature of their previous work. This includes examining the number of contracts awarded, their values, performance ratings, and any reported issues or successes. A review of prior contracts would help assess IBM's familiarity with the DEA's specific IT environment and their ability to meet performance expectations for software maintenance and overhaul, thereby informing the risk associated with this current award.

How does the $12.9 million value compare to similar IT software maintenance contracts awarded by the DOJ or other agencies?

Benchmarking this $12.9 million contract against similar IT software maintenance and overhaul contracts requires access to detailed contract data. Factors such as the scope of services, the specific software applications supported, the duration of the contract, and the agency's size and complexity are crucial for a fair comparison. Contracts for maintaining large enterprise resource planning (ERP) systems or critical infrastructure software typically command higher values than those for less complex applications. Without specific details on the software being maintained and the service level agreements, it's difficult to definitively state if this value is high or low. However, for a three-year period supporting potentially complex systems, the amount appears within a reasonable range for a large incumbent provider.

What are the primary risks associated with this contract for the Drug Enforcement Administration?

Key risks for the DEA include potential vendor lock-in, where reliance on IBM for maintenance could make switching providers difficult or costly in the future. There's also a risk related to the effectiveness of the maintenance services; if not performed optimally, it could lead to system downtime or security vulnerabilities. Given the firm-fixed-price nature, there's a risk of scope creep if the definition of 'maintenance, repair, and overhaul' is not tightly managed, potentially leading to cost overruns if not carefully monitored. Finally, a lack of detailed performance metrics could obscure potential issues until they become significant problems.

How effective is the NITAAC CIOSP3 vehicle for procuring IT software maintenance services?

The NITAAC CIOSP3 (Chief Information Officers Solutions and Partners 3) GWAC is generally considered an effective vehicle for procuring a wide range of IT solutions, including software maintenance. Its strength lies in its pre-competed nature, offering a streamlined acquisition process with pre-vetted vendors, which can reduce procurement lead times and administrative burden. The vehicle allows for various contract types and supports task orders ranging from simple services to complex solutions. However, the effectiveness for specific task orders like this one depends on how well the agency defines its requirements and manages the competition and performance under the awarded task order.

What is the historical spending trend for IT software maintenance and overhaul at the DEA?

To determine historical spending trends for IT software maintenance and overhaul at the DEA, a detailed analysis of past contract awards would be necessary. This would involve querying federal procurement databases (like FPDS-NG) for contracts awarded to the DEA specifically categorized under IT maintenance, repair, and overhaul services, or related NAICS codes (e.g., 541512). Examining spending over the last 5-10 fiscal years would reveal patterns, identify major vendors, and indicate whether spending has been consistent, increasing, or decreasing. This context is crucial for understanding if the current $12.9 million award represents a typical investment or a significant deviation.

What are the implications of awarding this contract as a delivery order under a GWAC versus a standalone contract?

Awarding this contract as a delivery order under the NITAAC CIOSP3 GWAC offers several implications compared to a standalone contract. Firstly, it leverages the pre-existing competition and contract terms established for the CIOSP3 vehicle, potentially speeding up the acquisition process. Secondly, it means the vendor (IBM) has already met the qualifications required by NITAAC. However, it might offer less flexibility in tailoring specific terms and conditions compared to a custom-solicited standalone contract. For taxpayers, using a GWAC can sometimes lead to better pricing due to the scale and competition inherent in the GWAC's structure, but it's essential to ensure the specific task order represents good value.

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 › IT AND TELECOM - APLLICATIONS

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)

Evaluated Preference: NONE

Contractor Details

Address: 6710 ROCKLEDGE DR, BETHESDA, MD, 20817

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

Financial Breakdown

Contract Ceiling: $17,078,017

Exercised Options: $12,961,059

Current Obligation: $12,902,682

Actual Outlays: $11,931,662

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSN316201200030W

IDV Type: GWAC

Timeline