IRS awards $305M Alliant 2 order for Enterprise Case Management integration services to Booz Allen Hamilton

Contract Overview

Contract Amount: $305,453,251 ($305.5M)

Contractor: Booz Allen Hamilton Inc

Awarding Agency: Department of the Treasury

Start Date: 2020-04-16

End Date: 2025-10-15

Contract Duration: 2,008 days

Daily Burn Rate: $152.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: THE INTERNAL REVENUE SERVICE (IRS), OFFICE OF INFORMATION TECHNOLOGY OFFICE, ISSUES THIS ORDER UNDER GSA ALLIANT 2 (UNRESTRICTED). ENTERPRISE CASE MANAGEMENT (ECM) SOLUTION INTEGRATION SERVICES

Place of Performance

Location: LANHAM, PRINCE GEORGES County, MARYLAND, 20706

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $305.5 million to BOOZ ALLEN HAMILTON INC for work described as: THE INTERNAL REVENUE SERVICE (IRS), OFFICE OF INFORMATION TECHNOLOGY OFFICE, ISSUES THIS ORDER UNDER GSA ALLIANT 2 (UNRESTRICTED). ENTERPRISE CASE MANAGEMENT (ECM) SOLUTION INTEGRATION SERVICES Key points: 1. Contract awarded under GSA Alliant 2 vehicle, indicating a pre-vetted procurement channel. 2. The contract is for Enterprise Case Management (ECM) solution integration services, a critical IT function for tax administration. 3. Booz Allen Hamilton, a large incumbent contractor, secured this significant award. 4. The contract duration spans over five years, suggesting a long-term need for these services. 5. The fixed-price contract type aims to control costs and provide budget certainty. 6. This award represents a substantial investment in modernizing IRS IT infrastructure.

Value Assessment

Rating: good

The contract value of $305.5 million over approximately 5.5 years suggests an average annual value of around $55.5 million. Benchmarking this against similar large-scale IT integration contracts within federal agencies requires detailed market analysis, but the Alliant 2 vehicle generally implies competitive pricing. The firm-fixed-price structure provides cost predictability for the IRS. Without specific per-unit data or comparable contract details, a precise value-for-money assessment is challenging, but the use of a GWAC and competitive award suggests a reasonable effort to achieve fair pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under the GSA Alliant 2 Government-Wide Acquisition Contract (GWAC), which is designed for full and open competition. The specific details on the number of bidders for this particular delivery order are not provided in the summary data. However, the Alliant 2 vehicle itself is a competitive contract vehicle, meaning multiple large businesses competed to be on the contract, and then agencies compete for task orders against other awardees. This process generally fosters price discovery and competition.

Taxpayer Impact: Full and open competition, especially through a GWAC like Alliant 2, is beneficial for taxpayers as it encourages multiple vendors to bid, driving down prices and ensuring the government receives competitive offers for its IT services.

Public Impact

The Internal Revenue Service (IRS) benefits directly through the modernization of its Enterprise Case Management systems. Taxpayers will indirectly benefit from improved efficiency and effectiveness in IRS case processing and administration. The services delivered will enhance the IRS's ability to manage cases related to tax law enforcement and compliance. The primary geographic impact is within the IRS's operational centers, likely nationwide, supporting its mission. This contract supports a significant number of IT professionals within Booz Allen Hamilton and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if integration services create deep dependencies on Booz Allen Hamilton's proprietary solutions or methodologies.
Risk of cost overruns if the scope of 'integration services' expands beyond initial expectations without proper change control.
Dependence on a single large contractor for a critical IT system could pose continuity risks.
The long duration of the contract may lead to less frequent opportunities for competitive re-evaluation of services.
Ensuring adequate knowledge transfer and documentation is crucial for future system maintenance and upgrades.

Positive Signals

Awarded under a GSA Alliant 2 GWAC, which is a competitively awarded contract vehicle.
The firm-fixed-price contract type provides cost certainty and incentivizes efficient performance.
Booz Allen Hamilton is a large, established contractor with significant experience in federal IT services.
The contract duration allows for sustained focus on complex integration challenges.
The IRS's Office of Information Technology is overseeing this critical modernization effort.

Sector Analysis

This contract falls within the Computer Systems Design Services sector (NAICS 541512), a large and dynamic segment of the federal IT market. The federal government is a major consumer of these services, particularly for system integration, custom software development, and IT consulting. Spending in this sector is driven by the need for agencies to modernize legacy systems, improve cybersecurity, and enhance data management capabilities. The IRS's investment in an Enterprise Case Management solution is a common initiative across government to streamline operations and improve service delivery.

Small Business Impact

This contract was awarded under an unrestricted GSA Alliant 2 vehicle, and the summary data indicates that small business set-aside provisions (ss: false, sb: false) were not applicable to this specific delivery order. Therefore, there is no direct small business set-aside component. However, large prime contractors like Booz Allen Hamilton often utilize small business subcontractors to fulfill contract requirements, potentially creating subcontracting opportunities within the small business ecosystem. The extent of such subcontracting would depend on Booz Allen Hamilton's specific teaming arrangements and business strategy for this contract.

Oversight & Accountability

Oversight for this contract is primarily managed by the Internal Revenue Service (IRS), Office of Information Technology. As a delivery order under a GSA Alliant 2 GWAC, it benefits from the oversight structures inherent in GSA's management of the GWAC vehicle. The firm-fixed-price nature of the contract provides a degree of financial oversight. Transparency is facilitated through contract award databases like FPDS. Specific Inspector General jurisdiction would typically fall under the Treasury Inspector General for Tax Administration (TIGTA), who audits and investigates IRS programs and operations.

Related Government Programs

GSA Alliant 2 GWAC
Enterprise Case Management Systems
IRS IT Modernization Programs
Federal IT Services Procurement
Computer Systems Design Services

Risk Flags

Long contract duration may reduce agility.
Potential for scope creep in integration services.
Dependence on a single large contractor.
Cybersecurity risks during system integration.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $305.5 million to BOOZ ALLEN HAMILTON INC. THE INTERNAL REVENUE SERVICE (IRS), OFFICE OF INFORMATION TECHNOLOGY OFFICE, ISSUES THIS ORDER UNDER GSA ALLIANT 2 (UNRESTRICTED). ENTERPRISE CASE MANAGEMENT (ECM) SOLUTION INTEGRATION SERVICES

Who is the contractor on this award?

The obligated recipient is BOOZ ALLEN HAMILTON 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 $305.5 million.

What is the period of performance?

Start: 2020-04-16. End: 2025-10-15.

What is the track record of Booz Allen Hamilton in delivering similar Enterprise Case Management (ECM) integration services to the IRS or other federal agencies?

Booz Allen Hamilton has a long-standing and extensive track record of providing IT services, including system integration and case management solutions, to the IRS and numerous other federal agencies. They are a prime contractor on multiple large IT vehicles, including GSA Alliant 2, which is specifically designed for complex IT solutions. Their experience often involves modernizing legacy systems, implementing new software platforms, and integrating disparate IT systems to improve workflow efficiency and data management. While specific details on their performance for this exact ECM integration task order would require deeper analysis of performance reports and past performance evaluations, their general profile suggests a high level of capability and experience in this domain. Past performance information is typically a key factor in award decisions for such significant contracts.

How does the per-unit cost or hourly rate for Booz Allen Hamilton on this contract compare to market rates for similar IT integration services?

The provided data summarizes the total contract value and duration but does not include specific per-unit cost breakdowns, such as hourly rates for different labor categories or pricing for specific integration modules. The contract type is Firm Fixed Price (FFP), which means the total price is set, and the contractor assumes the risk of cost overruns. While FFP contracts aim for cost control, they don't always provide direct visibility into underlying unit costs unless detailed CLIN structures are available. Benchmarking FFP contracts against market rates is complex, as it depends heavily on the scope, complexity, and specific deliverables. However, the use of the GSA Alliant 2 GWAC, a competitively awarded vehicle, suggests that the pricing was considered fair and reasonable at the time of award, likely benchmarked against other Alliant 2 awardees and broader federal IT service market data available to GSA.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Key risks for this $305 million Enterprise Case Management (ECM) solution integration services contract include potential scope creep, integration complexities with existing IRS systems, cybersecurity vulnerabilities during integration, and potential delays impacting the IRS's operational timelines. Mitigation strategies likely involve robust project management, clearly defined scope and deliverables within the contract, phased integration approaches, rigorous testing protocols, and adherence to strict cybersecurity standards mandated by the IRS and federal regulations. The firm-fixed-price nature also incentivizes the contractor, Booz Allen Hamilton, to manage costs and timelines effectively. Regular performance reviews and oversight by the IRS Office of Information Technology are crucial for identifying and addressing risks proactively.

How effective is the chosen procurement vehicle (GSA Alliant 2) for acquiring these types of complex IT integration services?

The GSA Alliant 2 GWAC is generally considered a highly effective procurement vehicle for acquiring complex IT integration services for large federal agencies like the IRS. It is a multiple-award, indefinite-delivery/indefinite-quantity (IDIQ) contract specifically designed for IT solutions, offering a wide range of services. Its key advantages include pre-competed large businesses, streamlined ordering procedures, and built-in flexibility. For the IRS, using Alliant 2 likely reduced procurement lead time and administrative burden compared to a full open-market competition. The vehicle's structure encourages competition among highly capable contractors, fostering innovation and competitive pricing, making it suitable for substantial projects like ECM integration.

What is the historical spending pattern for Enterprise Case Management (ECM) solutions at the IRS, and how does this award compare?

Historical spending data for ECM solutions at the IRS is not directly provided in the summary. However, federal agencies, including the IRS, have consistently invested in case management systems to improve efficiency, compliance, and service delivery. These investments often span multiple years and involve significant IT modernization efforts. The $305.5 million award for integration services over approximately 5.5 years represents a substantial, but not necessarily unprecedented, investment in a critical IT capability. It aligns with the broader trend of federal agencies upgrading their core operational systems to leverage modern technology, enhance data analytics, and improve user experience for both employees and the public.

What are the implications of this contract being awarded as a Firm Fixed Price (FFP) contract?

Awarding this contract as Firm Fixed Price (FFP) has significant implications for both the IRS and Booz Allen Hamilton. For the IRS, it provides budget certainty, as the total cost is established upfront, minimizing the risk of cost overruns. This structure incentivizes the contractor to perform efficiently and manage their own costs effectively to maximize profit. For Booz Allen Hamilton, it shifts the primary risk of cost overruns to them. They must accurately estimate all costs associated with the integration services, including labor, materials, and overhead. While FFP contracts can lead to higher initial prices to account for contractor risk, they simplify financial oversight for the government and encourage disciplined project execution by the contractor.

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: 8283 GREENSBORO DR, MCLEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $305,453,251

Exercised Options: $305,453,251

Current Obligation: $305,453,251

Actual Outlays: $305,403,251

Subaward Activity

Number of Subawards: 60

Total Subaward Amount: $86,712,771

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 47QTCK18D0004

IDV Type: GWAC

Timeline