Accenture Federal Services awarded $64M for IRS computer systems design, with a 947-day performance period

Contract Overview

Contract Amount: $64,044,186 ($64.0M)

Contractor: Accenture Federal Services LLC

Awarding Agency: Department of the Treasury

Start Date: 2022-05-13

End Date: 2024-12-15

Contract Duration: 947 days

Daily Burn Rate: $67.6K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: TASK ORDER 0023

Place of Performance

Location: LANHAM, PRINCE GEORGES County, MARYLAND, 20706

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $64.0 million to ACCENTURE FEDERAL SERVICES LLC for work described as: TASK ORDER 0023 Key points: 1. The contract value of $64M over approximately 2.6 years suggests a significant investment in IT infrastructure. 2. The firm fixed-price contract type indicates a defined scope and budget, potentially mitigating cost overruns. 3. The 'Computer Systems Design Services' NAICS code points to a focus on modernizing or maintaining critical IRS systems. 4. The award was made under full and open competition, implying a robust bidding process. 5. The contract duration of 947 days allows for substantial project development and implementation. 6. The absence of small business set-aside flags suggests this was not specifically targeted for smaller firms.

Value Assessment

Rating: good

The contract value of $64M for computer systems design services over 947 days appears reasonable given the scope of supporting a major federal agency like the IRS. Benchmarking against similar large-scale IT modernization contracts within the federal government would provide further context on value for money. The firm fixed-price structure is generally favorable for cost control when the scope is well-defined.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. This typically leads to a more competitive environment, potentially resulting in better pricing and innovative solutions for the government. The specific number of bidders is not provided, but the competition type suggests multiple entities vied for this opportunity.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive marketplace that can drive down costs and improve the quality of services delivered.

Public Impact

Taxpayers will benefit from potentially improved efficiency and accuracy in tax processing and services due to modernized IRS systems. The contract will deliver essential computer systems design and integration services to the Internal Revenue Service. The primary geographic impact is likely within Maryland, where the contractor is based, and wherever IRS IT operations are centralized. The contract supports a workforce skilled in IT services, including system design, development, and potentially maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if the designed systems are highly proprietary.
Risk of scope creep if requirements are not meticulously managed throughout the contract lifecycle.
Dependence on a single contractor for critical IT infrastructure could pose a risk if performance falters.

Positive Signals

Firm fixed-price contract provides budget certainty.
Full and open competition suggests a competitive award process.
Longer contract duration allows for thorough development and implementation.
Contractor's experience in federal IT services is likely a positive factor.

Sector Analysis

The IT services sector within the federal government is substantial, encompassing a wide range of needs from software development to cybersecurity and infrastructure management. Contracts for computer systems design, like this one, are crucial for agencies to maintain and upgrade their technological capabilities. The IRS, as a large agency, requires continuous investment in its IT infrastructure to handle vast amounts of data and complex processing, making this contract a key component of its operational strategy.

Small Business Impact

The data indicates this contract was not awarded as a small business set-aside, nor does it explicitly mention subcontracting goals for small businesses. This suggests that the primary award went to a large business, and the direct impact on the small business ecosystem may be limited unless Accenture Federal Services actively engages small businesses for subcontracting opportunities. Further analysis of subcontracting plans would be needed to fully assess the impact on small businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program officials within the IRS. The firm fixed-price nature of the contract provides a degree of accountability for the contractor to deliver within the agreed-upon budget. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

IRS IT Modernization Programs
Federal Civilian IT Services
Department of the Treasury IT Contracts
Computer Systems Design and Related Services

Risk Flags

Potential for cost overruns if scope is not tightly managed.
Risk of vendor lock-in with proprietary system designs.
Dependence on contractor performance for critical IT functions.
Need for clear performance metrics and oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $64.0 million to ACCENTURE FEDERAL SERVICES LLC. TASK ORDER 0023

Who is the contractor on this award?

The obligated recipient is ACCENTURE FEDERAL SERVICES 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 $64.0 million.

What is the period of performance?

Start: 2022-05-13. End: 2024-12-15.

What is Accenture Federal Services' track record with similar large-scale IT system design contracts for federal agencies?

Accenture Federal Services has a significant history of performing large-scale IT system design and integration contracts across various federal agencies, including the Department of Defense, Health and Human Services, and others. Their portfolio often includes complex modernization efforts, enterprise resource planning implementations, and cloud migration projects. While specific performance metrics for past IRS contracts are not detailed here, their extensive experience suggests a capacity to handle the technical and programmatic demands of this task order. Reviewing past performance evaluations and contract awards would provide a more granular understanding of their success rates and client satisfaction on comparable projects.

How does the $64M value compare to other federal contracts for computer systems design services?

The $64 million contract value for computer systems design services awarded to Accenture Federal Services is substantial, placing it within the upper tier of federal IT procurements. However, the federal IT market is vast, with many contracts ranging from a few million to hundreds of millions of dollars. For instance, major agency-wide IT modernization efforts or the development of entirely new large-scale systems can easily exceed this amount. This $64M award, covering a period of approximately 2.6 years, suggests a significant but not unprecedented investment. Benchmarking against contracts with similar NAICS codes (541512) and scope for agencies of the IRS's size would reveal if this represents a particularly high or low cost per year or per deliverable.

What are the primary risks associated with a firm fixed-price contract for complex IT system design?

The primary risks associated with a firm fixed-price (FFP) contract for complex IT system design revolve around scope definition and management. If the requirements are not clearly and comprehensively defined upfront, the contractor may face significant challenges in delivering the intended system within the fixed price. This can lead to either the contractor absorbing unexpected costs, potentially impacting their profitability and future willingness to bid, or seeking change orders, which can increase the overall cost to the government. For the government, the risk lies in potentially receiving a system that does not fully meet evolving needs if the scope is too rigid, or in paying more through change orders if the initial scope was inadequate. Effective project management and a robust change control process are crucial to mitigate these risks.

How might the 'Computer Systems Design Services' scope impact the IRS's long-term IT strategy?

The 'Computer Systems Design Services' scope is critical for the IRS's long-term IT strategy as it likely involves the development, integration, or modernization of core systems that underpin tax administration. This could include anything from enhancing taxpayer portals and improving data processing capabilities to implementing new analytics platforms or upgrading foundational infrastructure. The choices made in system design—such as technology stack, architecture, scalability, and security protocols—will have lasting implications. A well-executed contract could lead to greater operational efficiency, improved data security, enhanced taxpayer services, and better compliance capabilities. Conversely, a poorly designed system could result in technical debt, increased maintenance costs, and hinder future technological advancements.

What does the 947-day duration imply about the complexity and expected outcomes of this contract?

A contract duration of 947 days, approximately 2.6 years, suggests that the scope of work for computer systems design services is substantial and likely involves complex development, integration, and testing phases. Such a timeframe is typical for projects that require significant architectural planning, coding, deployment, and potentially phased rollouts. It implies that the IRS is investing in a project that is not a quick fix but rather a strategic initiative aimed at delivering significant improvements or new capabilities. The extended period allows for thoroughness in design, development, and quality assurance, reducing the likelihood of rushed work and increasing the potential for a robust and well-integrated final system.

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: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Novetta Solutions, LLC

Address: 800 NORTH GLEBE RD #300, ARLINGTON, VA, 22203

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

Financial Breakdown

Contract Ceiling: $75,154,659

Exercised Options: $64,044,366

Current Obligation: $64,044,186

Actual Outlays: $64,044,186

Subaward Activity

Number of Subawards: 68

Total Subaward Amount: $9,263,534

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: TIRNO17D00004

IDV Type: IDC

Timeline