Treasury's IRS awards $26.5M for BMC Software & Maintenance, with 3 delivery orders
Contract Overview
Contract Amount: $26,532,643 ($26.5M)
Contractor: Four LLC
Awarding Agency: Department of the Treasury
Start Date: 2020-03-31
End Date: 2025-05-29
Contract Duration: 1,885 days
Daily Burn Rate: $14.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: BMC SOFTWARE AND MAINTENANCE
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20171
State: Virginia Government Spending
Plain-Language Summary
Department of the Treasury obligated $26.5 million to FOUR LLC for work described as: BMC SOFTWARE AND MAINTENANCE Key points: 1. Spending on BMC software and maintenance totals $26.5M over its contract life. 2. The contract was awarded under full and open competition. 3. Potential risk exists if BMC software becomes proprietary and difficult to replace. 4. The IT sector sees significant spending on software licenses and maintenance.
Value Assessment
Rating: good
The contract's pricing is considered good given the firm fixed-price structure and the duration of the contract. Benchmarking against similar software maintenance contracts is challenging without more specific service level agreements.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, suggesting a competitive bidding process that likely led to favorable pricing. The use of delivery orders allows for flexibility in acquiring specific BMC software and maintenance needs.
Taxpayer Impact: Taxpayers benefit from a competitive award process that aims to secure software and maintenance at a reasonable cost for the IRS's critical operations.
Public Impact
Ensures IRS has necessary software for tax administration and operations. Supports critical government functions through reliable software maintenance. Potential for cost savings through competitive bidding on software solutions.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Vendor lock-in risk with proprietary BMC software.
- Potential for price increases upon contract renewal.
- Dependence on a single software vendor for critical IRS functions.
Positive Signals
- Awarded under full and open competition.
- Firm fixed-price contract structure provides cost certainty.
- Long-term contract allows for stable software support.
Sector Analysis
This contract falls within the IT sector, specifically software publishers. Spending on enterprise software and maintenance is a significant portion of government IT budgets, often driven by the need for specialized functionalities and ongoing support.
Small Business Impact
The data does not indicate any specific set-asides for small businesses. The primary contractor, FOUR LLC, is not identified as a small business in this context, suggesting the competition may have favored larger, established vendors.
Oversight & Accountability
The contract is managed by the Department of the Treasury's Internal Revenue Service. Oversight would involve monitoring software performance, adherence to the firm fixed-price terms, and ensuring timely delivery of maintenance services.
Related Government Programs
- Software Publishers
- Department of the Treasury Contracting
- Internal Revenue Service Programs
Risk Flags
- Vendor Lock-in
- Price Escalation Risk
- Dependence on Single Vendor
- Limited Transparency on Software Effectiveness
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 $26.5 million to FOUR LLC. BMC SOFTWARE AND MAINTENANCE
Who is the contractor on this award?
The obligated recipient is FOUR 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 $26.5 million.
What is the period of performance?
Start: 2020-03-31. End: 2025-05-29.
What is the total cost of ownership for BMC software over its lifecycle, including potential future upgrades and support?
The current contract value is $26.5M through May 2025. A full lifecycle cost analysis would require projections for extended maintenance, potential new license purchases, and future version upgrades. Without this forward-looking data, the total cost of ownership remains an estimate, but the firm fixed-price nature of the current award provides a degree of predictability for the specified period.
What are the risks associated with relying on a single vendor for critical IRS software and maintenance?
Reliance on a single vendor like BMC creates a risk of vendor lock-in, making it difficult and costly to switch to alternative solutions if needed. This can also lead to price escalations upon contract renewal, as the vendor may have significant leverage. Furthermore, any disruption in the vendor's ability to provide support or updates could directly impact the IRS's operational continuity.
How effectively does this BMC software solution support the IRS's core tax administration functions?
The contract's purpose is to provide BMC software and maintenance, implying it supports essential IRS operations. However, the effectiveness is not explicitly detailed in the provided data. A thorough assessment would require evaluating the software's performance metrics, user feedback, and its direct contribution to tax processing, compliance, and taxpayer services.
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: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 2303 DULLES STATION BLVD, HERNDON, VA, 20171
Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business
Financial Breakdown
Contract Ceiling: $30,000,000
Exercised Options: $26,532,643
Current Obligation: $26,532,643
Actual Outlays: $26,532,643
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Parent Contract
Parent Award PIID: GS35F0312U
IDV Type: FSS
Timeline
Start Date: 2020-03-31
Current End Date: 2025-05-29
Potential End Date: 2025-05-29 00:00:00
Last Modified: 2025-05-20
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