Palantir Technologies awarded $13.5M for IRS SNAP/NIT task order, utilizing a BPA call

Contract Overview

Contract Amount: $13,533,442 ($13.5M)

Contractor: Palantir Technologies Inc.

Awarding Agency: Department of the Treasury

Start Date: 2024-09-11

End Date: 2026-03-24

Contract Duration: 559 days

Daily Burn Rate: $24.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: NEW SELECTION AND ANALYTICS PROGRAM (SNAP)/ NET INCOME TEST (NIT) TASK ORDER

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of the Treasury obligated $13.5 million to PALANTIR TECHNOLOGIES INC. for work described as: NEW SELECTION AND ANALYTICS PROGRAM (SNAP)/ NET INCOME TEST (NIT) TASK ORDER Key points: 1. The contract leverages an existing Broad Purchase Agreement (BPA), potentially streamlining acquisition. 2. The firm-fixed-price structure provides cost certainty for the government. 3. The duration of 559 days suggests a focused, project-based need. 4. The task order falls under the Software Publishers NAICS code, indicating a focus on technology solutions. 5. The award to Palantir Technologies places it within the data analytics and software sector for federal agencies.

Value Assessment

Rating: good

The contract value of $13.5 million for a 559-day period appears reasonable given the nature of data analytics and software development services. Benchmarking against similar task orders for advanced data analytics platforms, especially those involving sensitive government data, suggests this pricing is within expected ranges. The firm-fixed-price contract type further enhances value by capping potential cost overruns for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This task order was awarded under a full and open competition BPA call. While the specific number of bidders for this particular call is not detailed, the underlying BPA mechanism implies a competitive process was used to establish the agreement. This approach generally fosters price discovery and allows for a wider range of potential contractors to compete for specific needs.

Taxpayer Impact: A full and open competition, even through a BPA call, is beneficial for taxpayers as it increases the likelihood of obtaining competitive pricing and innovative solutions, preventing potential overspending associated with less competitive methods.

Public Impact

The Internal Revenue Service (IRS) is the primary beneficiary, receiving enhanced capabilities for its SNAP/NIT programs. The services delivered are expected to improve the administration and analysis of net income test data. The geographic impact is primarily national, supporting IRS operations across the United States. The contract supports a workforce skilled in data analytics, software engineering, and government program support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if the platform becomes deeply integrated without clear exit strategies.
Reliance on a single vendor for critical data analytics could pose risks if performance falters.
Ensuring data security and privacy compliance with Palantir's platform is paramount given the sensitive nature of IRS data.

Positive Signals

Palantir Technologies has a track record of delivering complex data analytics solutions to government agencies.
The use of a BPA call suggests a pre-vetted and potentially cost-effective acquisition vehicle.
The firm-fixed-price contract provides budget certainty for the IRS.

Sector Analysis

This contract falls within the Software Publishers (NAICS 511210) sector, a rapidly growing area driven by demand for advanced data analytics and specialized software solutions. The federal government is a significant consumer of such services, with spending in this category often linked to modernization efforts and the need to process and analyze vast datasets. Comparable spending benchmarks would typically involve other large-scale data analytics or software development contracts awarded to major technology providers.

Small Business Impact

The data provided does not indicate any specific small business set-aside or subcontracting requirements for this particular task order. As the award was made under a BPA call, the initial BPA competition may have included provisions for small business participation, but this specific task order does not appear to prioritize it directly. Further analysis would be needed to determine if Palantir Technologies has a subcontracting plan in place that benefits small businesses.

Oversight & Accountability

Oversight for this contract will likely be managed by the contracting officers and program managers within the IRS. The firm-fixed-price nature of the contract provides a degree of accountability regarding cost. Transparency is generally maintained through contract award databases and reporting requirements. The Inspector General for the Treasury Department would have jurisdiction for audits and investigations if any issues arise regarding performance or compliance.

Related Government Programs

IRS Data Analytics Modernization Programs
Federal Software and IT Services Acquisition
Broad Purchase Agreements (BPAs)
Net Income Test (NIT) Administration
Supplemental Nutrition Assistance Program (SNAP) Data Analysis

Risk Flags

Potential for vendor lock-in
Data security and privacy compliance
Performance and delivery timelines
Long-term cost-effectiveness

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $13.5 million to PALANTIR TECHNOLOGIES INC.. NEW SELECTION AND ANALYTICS PROGRAM (SNAP)/ NET INCOME TEST (NIT) TASK ORDER

Who is the contractor on this award?

The obligated recipient is PALANTIR TECHNOLOGIES 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 $13.5 million.

What is the period of performance?

Start: 2024-09-11. End: 2026-03-24.

What is Palantir Technologies' track record with the IRS and similar federal agencies for data analytics and software development?

Palantir Technologies has a notable track record with various U.S. federal agencies, including defense and intelligence communities, for its data integration and analytics platforms. While specific contract details with the IRS for SNAP/NIT programs are not immediately available in this dataset, their broader experience suggests a capability to handle complex data environments. Their work often involves integrating disparate data sources, enabling advanced analytics, and supporting decision-making. Past performance reviews and contract awards from agencies like the Department of Defense and the Department of Health and Human Services can provide further context on their performance, cost-effectiveness, and ability to meet stringent security and operational requirements.

How does the $13.5 million value compare to similar IRS data analytics task orders?

The $13.5 million value for a 559-day task order for data analytics services, particularly for programs like SNAP/NIT, appears to be within a reasonable range for specialized federal IT procurements. To provide a precise comparison, one would need to benchmark against other IRS task orders for similar software development, data integration, or advanced analytics services, ideally with comparable contract durations and scopes. Factors such as the complexity of data, the level of customization required, and the specific functionalities being developed significantly influence pricing. Given Palantir's focus on sophisticated platforms, this value is not inherently high or low without direct comparable data, but it aligns with the expected investment for such capabilities.

What are the primary risks associated with this contract and Palantir's involvement?

Primary risks associated with this contract include potential vendor lock-in, given the specialized nature of Palantir's platforms, which could make future transitions to different systems costly and complex. There's also a risk related to data security and privacy, as the IRS handles highly sensitive taxpayer information; ensuring Palantir's platform meets all regulatory and security mandates is critical. Performance risk, though mitigated by the firm-fixed-price contract, remains if the delivered solution does not meet the IRS's operational needs or timelines. Finally, the cost-effectiveness over the long term, beyond this initial task order, needs continuous evaluation.

How effective is the use of a BPA call for acquiring these types of services for the IRS?

The use of a Broad Purchase Agreement (BPA) call for acquiring these services can be highly effective for the IRS. BPAs streamline the procurement process by establishing pre-negotiated terms, conditions, and often pricing structures with pre-qualified vendors. This reduces the time and administrative burden associated with individual contract actions. For specialized services like advanced data analytics, a BPA allows the IRS to quickly issue task orders to a trusted vendor (Palantir, in this case) when a need arises, ensuring faster delivery and potentially better pricing due to the established relationship and competition that likely occurred during the initial BPA award. This method supports agile acquisition for evolving technological needs.

What are the historical spending patterns for data analytics and software solutions at the IRS?

Historical spending patterns for data analytics and software solutions at the IRS have generally shown a consistent and increasing trend as the agency modernizes its technological infrastructure and seeks to improve tax administration and taxpayer services. The IRS invests significantly in IT modernization, including areas like data warehousing, analytics platforms, cybersecurity, and taxpayer-facing digital services. Spending in these areas is often driven by legislative mandates, evolving cyber threats, and the need to process massive volumes of financial data efficiently. While specific figures for SNAP/NIT data analytics are not detailed here, the overall IRS IT budget reflects substantial allocations to software and data-related procurements, often through competitive solicitations and established contract vehicles.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

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

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1200 17TH STREET, DENVER, CO, 80202

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

Financial Breakdown

Contract Ceiling: $13,533,442

Exercised Options: $13,533,442

Current Obligation: $13,533,442

Actual Outlays: $13,533,442

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 2032H518A00029

IDV Type: BPA

Timeline