Treasury's IRS awards $40.4M for ID.ME software and maintenance to V3GATE, LLC
Contract Overview
Contract Amount: $40,367,324 ($40.4M)
Contractor: V3gate, LLC
Awarding Agency: Department of the Treasury
Start Date: 2024-06-21
End Date: 2025-06-20
Contract Duration: 364 days
Daily Burn Rate: $110.9K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: ID.ME SOFTWARE AND MAINTENANCE
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20220
Plain-Language Summary
Department of the Treasury obligated $40.4 million to V3GATE, LLC for work described as: ID.ME SOFTWARE AND MAINTENANCE Key points: 1. Contract awarded via a BPA Call under full and open competition. 2. The contract has a duration of 364 days, indicating a short-term need. 3. Pricing structure is Firm Fixed Price, providing cost certainty. 4. No small business set-aside was utilized for this procurement. 5. The contract is for software and maintenance, a critical IT function. 6. The award value is substantial, requiring careful performance monitoring.
Value Assessment
Rating: fair
The contract value of $40.4 million for one year of software and maintenance appears high for a single vendor. Benchmarking against similar software maintenance contracts for large federal agencies is necessary to determine if this represents a competitive price. Without specific details on the software's criticality and the scope of maintenance, a definitive value assessment is challenging. However, the firm fixed-price nature offers predictability.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. The use of a BPA Call implies that a broader contract vehicle was already established, and this is a call-off against it. The number of bidders is not specified, but full and open competition generally promotes price discovery and can lead to more favorable pricing for the government.
Taxpayer Impact: Full and open competition is generally beneficial for taxpayers as it encourages a competitive bidding process, which can drive down costs and improve the quality of services received.
Public Impact
Benefits IRS IT operations by ensuring continued access to and support for essential software. Supports the functioning of critical tax administration systems. Geographic impact is primarily within the District of Columbia, where the IRS is headquartered. Workforce implications are likely limited to IT support staff managing the software.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in if the software is proprietary and critical.
- Risk of cost escalation in future contract renewals if competition is not maintained.
- Dependence on a single vendor for essential software maintenance.
Positive Signals
- Awarded through full and open competition, indicating a competitive process.
- Firm Fixed Price contract provides cost certainty for the duration.
- BPA Call mechanism suggests an established procurement framework.
Sector Analysis
The Information Technology sector, specifically software and maintenance services, is a significant area of federal spending. Agencies rely heavily on software for daily operations, data management, and citizen services. The market for IT services is vast, with numerous providers ranging from large corporations to specialized small businesses. This contract fits within the broader category of IT support services, essential for maintaining the operational integrity of government systems.
Small Business Impact
This contract was not awarded as a small business set-aside, nor does it indicate any specific subcontracting requirements for small businesses. This means that opportunities for small businesses to participate in this specific contract are likely limited unless they are part of a larger prime contractor's team (which is not indicated here). The absence of set-aside provisions suggests the primary focus was on obtaining the best value through open competition.
Oversight & Accountability
Oversight for this contract would typically fall under the IRS's contracting officer and program managers. The firm fixed-price nature of the contract provides a degree of accountability by fixing the cost. Transparency is generally maintained through contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- IRS IT Modernization Programs
- Federal Civilian Agency Software Licensing
- IT Services and Support Contracts
- General Services Administration (GSA) Schedules
Risk Flags
- Potential for vendor lock-in
- High contract value requires close monitoring
- Lack of specific software details hinders full assessment
Tags
it, software-maintenance, irs, department-of-the-treasury, bpa-call, firm-fixed-price, full-and-open-competition, district-of-columbia, identity-verification, v3gate-llc
Frequently Asked Questions
What is this federal contract paying for?
Department of the Treasury awarded $40.4 million to V3GATE, LLC. ID.ME SOFTWARE AND MAINTENANCE
Who is the contractor on this award?
The obligated recipient is V3GATE, 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 $40.4 million.
What is the period of performance?
Start: 2024-06-21. End: 2025-06-20.
What specific software is covered under this ID.ME contract, and what is its criticality to IRS operations?
The provided data does not specify the exact software covered by 'ID.ME SOFTWARE AND MAINTENANCE'. ID.ME is a common identity verification service used by many government agencies, including the IRS, for secure online access to taxpayer accounts and services. If this contract pertains to the core ID.ME platform, its criticality would be extremely high, as it underpins secure digital interactions between taxpayers and the IRS. The maintenance component would ensure the software's availability, security, and functionality. The lack of specific software details makes a precise assessment of its operational impact difficult, but identity verification is a fundamental security and service delivery function.
How does the $40.4 million award value compare to historical spending on similar IRS software and maintenance contracts?
Without access to historical spending data for specific IRS software and maintenance contracts, a direct comparison is challenging. However, $40.4 million for a single year of software and maintenance is a significant investment. To assess value, one would need to compare this to previous contracts for the same or similar software, or to contracts for comparable identity verification or IT support services awarded to other federal agencies. Factors such as the scope of services, number of users supported, and the specific software's complexity would influence historical costs. A detailed analysis would require examining past solicitations and awards for IRS IT infrastructure.
What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract to ensure performance?
The provided data does not detail the specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. Typically, for software and maintenance contracts, KPIs and SLAs would focus on aspects such as software uptime/availability, response times for technical support, resolution times for reported issues, security patch deployment timelines, and performance metrics related to the identity verification process. The IRS contracting officer and program managers would be responsible for defining and monitoring these metrics to ensure V3GATE, LLC meets its contractual obligations and delivers the expected level of service and performance.
What is V3GATE, LLC's track record with the IRS or other federal agencies for similar software and maintenance services?
The provided data does not include information on V3GATE, LLC's specific track record with the IRS or other federal agencies. A thorough assessment would require reviewing past performance evaluations, contract history, and any reported issues or commendations related to V3GATE, LLC's previous work, particularly in providing software and maintenance services. Understanding their experience with similar systems, their ability to meet deadlines, and their overall performance quality is crucial for evaluating the risk associated with this award and ensuring successful contract execution.
What is the potential risk of vendor lock-in with this contract, and what mitigation strategies are in place?
There is a potential risk of vendor lock-in if the 'ID.ME SOFTWARE' is proprietary and critical to IRS operations, and if V3GATE, LLC is the sole provider or developer. This could make it difficult and costly for the IRS to switch to a different vendor or solution in the future. Mitigation strategies could include ensuring contract terms allow for data portability, requiring documentation and knowledge transfer, and actively exploring alternative solutions during the contract period. The IRS should also consider the long-term strategy for identity verification services to avoid prolonged dependence on a single vendor.
Industry Classification
NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - END USER
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
Address: 555 MIDDLE CREEK PKWY UNIT 120, COLORADO SPRINGS, CO, 80921
Business Categories: Category Business, Hispanic American Owned Business, Limited Liability Corporation, Minority Owned Business, Partnership or Limited Liability Partnership, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business
Financial Breakdown
Contract Ceiling: $40,367,324
Exercised Options: $40,367,324
Current Obligation: $40,367,324
Actual Outlays: $40,367,324
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Parent Contract
Parent Award PIID: 2032H520A00009
IDV Type: BPA
Timeline
Start Date: 2024-06-21
Current End Date: 2025-06-20
Potential End Date: 2025-06-20 00:00:00
Last Modified: 2025-04-27
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