Treasury's $11.6M Information Returns Program Development contract awarded to Cybermedia Technologies, LLC

Contract Overview

Contract Amount: $11,608,525 ($11.6M)

Contractor: Cybermedia Technologies, LLC

Awarding Agency: Department of the Treasury

Start Date: 2022-11-30

End Date: 2026-11-29

Contract Duration: 1,460 days

Daily Burn Rate: $8.0K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: INFORMATION RETURNS PROGRAM DEVELOPMENT (IRPD). THE OBJECTIVES OF THE IRPD PWS INCLUDE MODERNIZING INFORMATION RETURNS PROCESSING, ENHANCING THE DATA QUALITY, AND ALIGNING THE MODERNIZATION EFFORTS FROM THIRD PARTIES AND GOVERNMENT INSTITUTIONS.

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20191

State: Virginia Government Spending

Plain-Language Summary

Department of the Treasury obligated $11.6 million to CYBERMEDIA TECHNOLOGIES, LLC for work described as: INFORMATION RETURNS PROGRAM DEVELOPMENT (IRPD). THE OBJECTIVES OF THE IRPD PWS INCLUDE MODERNIZING INFORMATION RETURNS PROCESSING, ENHANCING THE DATA QUALITY, AND ALIGNING THE MODERNIZATION EFFORTS FROM THIRD PARTIES AND GOVERNMENT INSTITUTIONS. Key points: 1. Contract aims to modernize information returns processing and enhance data quality. 2. Focus on aligning modernization efforts from third parties and government institutions. 3. Cybermedia Technologies, LLC, a single awardee, will provide custom computer programming services. 4. The contract is structured as a Firm Fixed Price (FFP) award. 5. Performance period spans four years, from November 2022 to November 2026. 6. No small business set-aside was utilized for this procurement.

Value Assessment

Rating: fair

The contract value of $11.6 million over four years for custom computer programming services appears to be within a reasonable range for a federal IT modernization effort. However, without specific benchmarks for the scope of 'Information Returns Program Development' and the complexity of the modernization, a precise value-for-money assessment is challenging. The firm fixed-price structure suggests that cost risks are largely borne by the contractor, which can be beneficial for the government if the scope is well-defined. Further analysis would require comparing the contractor's proposed solution and resource allocation against industry standards for similar large-scale data processing and system modernization projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but the 'full and open' designation suggests a competitive process was intended. This approach is generally favored for ensuring the government receives the best value by leveraging market competition. The absence of set-asides or other restrictions implies that the contracting agency believed the open market offered the most suitable solutions and pricing.

Taxpayer Impact: A full and open competition generally leads to better price discovery and potentially lower costs for taxpayers by encouraging a wider range of vendors to submit proposals.

Public Impact

Taxpayers benefit from improved accuracy and efficiency in processing tax-related information returns. Government agencies involved in tax administration will receive enhanced data quality and modernized systems. The program's modernization efforts could lead to more streamlined tax compliance processes. Workforce implications may include the need for specialized IT skills within the IRS and potentially the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Scope definition for 'modernizing information returns processing' could be more granular to ensure clear deliverables and prevent scope creep.
Reliance on a single contractor for a critical program development effort warrants close monitoring of performance and technical execution.
The success of aligning modernization efforts from third parties and government institutions depends heavily on inter-agency coordination and standardized protocols.

Positive Signals

The contract's objective to enhance data quality directly supports the IRS's mission and could lead to more accurate tax assessments.
A firm fixed-price contract incentivizes the contractor to manage costs effectively and deliver within budget.
The four-year performance period allows for sustained focus on a complex modernization initiative.

Sector Analysis

The Information Returns Program Development (IRPD) contract falls within the Custom Computer Programming Services sector (NAICS 541511). This sector is characterized by companies that write, modify, test, and support software to meet the needs of a particular customer. Federal spending in this area is substantial, driven by the continuous need to update legacy systems, enhance cybersecurity, and improve data management capabilities across various agencies. The market includes a wide range of providers, from large system integrators to specialized software development firms. This contract's focus on modernizing a core government function like information returns processing is typical of IT modernization efforts seen across federal agencies, aiming for greater efficiency and data integrity.

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 explicitly stated in the provided data. This means that opportunities for small businesses to participate in this specific contract are likely limited to subcontracting roles if the prime contractor chooses to engage them. The absence of a set-aside suggests that the agency determined that full and open competition was the best approach, potentially overlooking opportunities to directly foster small business participation in this particular procurement.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Treasury's Internal Revenue Service (IRS). As a Firm Fixed Price (FFP) contract, performance monitoring is crucial to ensure the contractor meets the defined scope and quality standards. The IRS likely has program managers and contracting officers responsible for overseeing contractor performance, reviewing deliverables, and ensuring compliance with the contract terms. Transparency is generally maintained through contract award databases and public reporting, though specific internal oversight mechanisms are not detailed here. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

IRS Modernization Initiatives
Taxpayer Data Management Systems
Information Technology Services
Custom Software Development
Federal Financial Systems

Risk Flags

Potential for scope creep in IT modernization projects.
Dependence on contractor's technical expertise and performance.
Need for robust inter-agency coordination for aligned modernization.
Ensuring data quality and integrity throughout the modernization process.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $11.6 million to CYBERMEDIA TECHNOLOGIES, LLC. INFORMATION RETURNS PROGRAM DEVELOPMENT (IRPD). THE OBJECTIVES OF THE IRPD PWS INCLUDE MODERNIZING INFORMATION RETURNS PROCESSING, ENHANCING THE DATA QUALITY, AND ALIGNING THE MODERNIZATION EFFORTS FROM THIRD PARTIES AND GOVERNMENT INSTITUTIONS.

Who is the contractor on this award?

The obligated recipient is CYBERMEDIA TECHNOLOGIES, 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 $11.6 million.

What is the period of performance?

Start: 2022-11-30. End: 2026-11-29.

What is the specific scope of 'modernizing information returns processing' and what are the key performance indicators (KPIs) for this contract?

The provided data indicates the objectives are 'modernizing information returns processing, enhancing the data quality, and aligning the modernization efforts from third parties and government institutions.' However, the specific scope and key performance indicators (KPIs) are not detailed. Typically, such modernization efforts would involve updating legacy systems, improving data ingestion and validation processes, enhancing data storage and retrieval capabilities, and ensuring compatibility with evolving tax laws and reporting requirements. KPIs would likely include metrics related to processing speed, error rates, data accuracy, system uptime, and successful integration with other IRS systems and external data sources. A detailed review of the Performance Work Statement (PWS) would be necessary to ascertain the precise scope and measurable outcomes.

How does the $11.6 million contract value compare to similar federal IT modernization projects for data processing?

Benchmarking the $11.6 million contract value requires comparing it against similar federal IT modernization projects focused on data processing and system upgrades. While specific comparable contract data is not provided, IT modernization projects for large government agencies can range from millions to hundreds of millions of dollars, depending on the complexity, scope, and duration. For a four-year project aimed at modernizing a critical function like information returns processing, $11.6 million suggests a focused effort, possibly on specific components or a particular phase of a larger modernization program. Larger, agency-wide system overhauls often incur significantly higher costs. Without more granular details on the project's specific deliverables and the number of systems being integrated or replaced, a precise comparison is difficult, but the value appears moderate for a multi-year federal IT initiative.

What are the potential risks associated with Cybermedia Technologies, LLC performing this contract, given their track record?

Assessing the risks associated with Cybermedia Technologies, LLC requires examining their past performance on federal contracts. Without access to their specific contract history, including past performance evaluations, on-time delivery rates, and any past disputes or contract terminations, a definitive risk assessment is not possible. However, general risks for any IT modernization contract include potential cost overruns if the scope is not well-defined, schedule delays due to technical challenges or resource constraints, and performance issues if the delivered solution does not meet the required quality standards. For this specific contract, risks could also involve the contractor's ability to effectively integrate new systems with existing IRS infrastructure and to manage the complexities of aligning modernization efforts across different entities. A review of past performance information (PPI) would be crucial for a thorough risk evaluation.

What is the expected impact of this contract on the IRS's ability to process tax information returns efficiently and accurately?

This contract is expected to significantly improve the IRS's efficiency and accuracy in processing tax information returns. By modernizing the Information Returns Program Development (IRPD), the IRS aims to enhance data quality, which is fundamental for accurate tax administration and enforcement. Modernized systems should allow for faster processing, better validation of incoming data, and improved capabilities to identify discrepancies or potential fraud. Aligning modernization efforts from third parties and government institutions suggests a move towards greater standardization and interoperability, which can streamline data exchange and reduce manual intervention. Ultimately, this should lead to a more robust and reliable system for managing the vast amounts of information returns the IRS receives annually.

How does the current spending on Information Returns Program Development compare to historical spending in this category?

The provided data only includes details for a single contract award of $11.6 million. To assess historical spending patterns, one would need access to broader contract data for the IRS or Treasury related to information returns processing and IT modernization over several fiscal years. Without this historical context, it is impossible to determine if the current spending level is higher, lower, or consistent with past investments in this area. Federal IT spending often fluctuates based on agency priorities, budget allocations, and the lifecycle of existing systems. A comprehensive analysis would involve examining annual IT budgets, contract awards for similar services, and the strategic importance placed on information returns processing over time.

Industry Classification

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

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Cybermedia Technologies LLC

Address: 8444 WESTPARK DR STE 620, MCLEAN, VA, 22102

Business Categories: Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Economically Disadvantaged Women Owned Small Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $21,300,610

Exercised Options: $13,830,224

Current Obligation: $11,608,525

Actual Outlays: $9,178,808

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 2032H522A00009

IDV Type: BPA

Timeline