Treasury's $2.76M purchase order for SECURE64 hardware/software awarded to Premier Systems Sales Ltd

Contract Overview

Contract Amount: $2,763,978 ($2.8M)

Contractor: Premier Systems Sales Ltd

Awarding Agency: Department of the Treasury

Start Date: 2024-08-29

End Date: 2026-08-31

Contract Duration: 732 days

Daily Burn Rate: $3.8K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SECURE64 HARDWARE AND SOFTWARE

Place of Performance

Location: MEMPHIS, SHELBY County, TENNESSEE, 38118

State: Tennessee Government Spending

Plain-Language Summary

Department of the Treasury obligated $2.8 million to PREMIER SYSTEMS SALES LTD for work described as: SECURE64 HARDWARE AND SOFTWARE Key points: 1. Value appears reasonable given the duration and nature of IT hardware/software procurement. 2. Sole-source award limits price discovery and potentially increases costs for taxpayers. 3. Lack of competition is a significant risk indicator for this contract. 4. Contract duration of 732 days suggests a need for ongoing support or licensing. 5. Procurement falls under 'Other Computer Related Services', a broad category. 6. Awarded via Purchase Order, a less formal procurement method than other contract types.

Value Assessment

Rating: fair

Benchmarking the value of this $2.76 million purchase order for SECURE64 hardware and software is challenging without specific details on the components and services included. However, for a two-year duration, the approximate annual spend of $1.38 million is within a plausible range for enterprise-level IT solutions. The lack of competitive bidding, however, prevents a robust assessment of whether this represents the best possible value for money compared to market alternatives.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a sole-source purchase order, meaning it was not competed. This approach is typically used when only one vendor can provide the required goods or services, or in urgent situations. The absence of multiple bidders means there was no opportunity to solicit competitive pricing, potentially leading to a higher cost than if the contract had been openly competed.

Taxpayer Impact: Sole-source awards limit the government's ability to secure the lowest possible prices, potentially resulting in taxpayers paying more for necessary IT solutions.

Public Impact

Internal Revenue Service (IRS) employees will benefit from access to SECURE64 hardware and software. The services delivered are related to IT infrastructure and security, supporting IRS operations. The geographic impact is likely concentrated within IRS facilities where the hardware and software are deployed. Workforce implications are minimal, as this is a procurement of goods and services, not a direct employment driver.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing and reduced innovation.
Sole-source awards can create vendor lock-in, making future procurements more difficult and expensive.
The specific nature of 'SECURE64' is not detailed, posing a risk if it's a proprietary solution with limited support options.

Positive Signals

Procurement of necessary IT hardware and software to support critical government functions.
Awarded to Premier Systems Sales Ltd., suggesting an established vendor relationship.
Fixed-price contract type provides cost certainty for the government.

Sector Analysis

The IT services sector, particularly for specialized hardware and software solutions, is highly competitive. However, this contract falls under 'Other Computer Related Services' (NAICS 541519), a broad category. The market for secure hardware and software is significant, driven by increasing cybersecurity threats and the need for robust IT infrastructure across government agencies. Benchmarking this specific procurement is difficult without knowing the exact components of SECURE64, but IT hardware and software procurements of this scale are common.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Premier Systems Sales Ltd. is not explicitly identified as a small business. There is no information provided regarding subcontracting plans, so the direct impact on the small business ecosystem is likely minimal unless Premier Systems Sales Ltd. utilizes small businesses in its supply chain.

Oversight & Accountability

As a purchase order, oversight mechanisms may be less formalized than for larger, more complex contracts. However, the Department of the Treasury and the IRS have internal audit and oversight functions. Transparency is limited due to the sole-source nature and the lack of publicly available detailed justifications. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

IT Hardware Procurement
Software Licensing and Support
Cybersecurity Solutions
General Services Administration (GSA) Schedules
IRS IT Modernization Efforts

Risk Flags

Sole-source award lacks competition
Potential for overpricing due to lack of competition
Lack of detailed justification for sole-source award
Limited transparency on specific product/service details

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $2.8 million to PREMIER SYSTEMS SALES LTD. SECURE64 HARDWARE AND SOFTWARE

Who is the contractor on this award?

The obligated recipient is PREMIER SYSTEMS SALES LTD.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $2.8 million.

What is the period of performance?

Start: 2024-08-29. End: 2026-08-31.

What is the specific functionality and criticality of the SECURE64 hardware and software being procured?

The provided data does not specify the exact functionality or criticality of the 'SECURE64' hardware and software. 'SECURE64' typically refers to a suite of security solutions, often related to network security, data encryption, or secure communication. Given its procurement by the IRS, it is likely critical for protecting sensitive taxpayer data and ensuring the integrity of internal IT systems. Without further details, it's difficult to assess its unique value or necessity beyond general IT security requirements. The procurement's sole-source nature suggests it might be a proprietary solution or one where Premier Systems Sales Ltd. is the sole authorized provider.

How does the $2.76 million cost compare to similar IT hardware and software procurements by the IRS or other federal agencies?

Comparing the $2.76 million cost for this two-year contract requires detailed knowledge of the specific SECURE64 components and services. However, for enterprise-level IT solutions, this figure is not exceptionally high, especially considering the duration. Many federal agencies procure similar IT hardware and software solutions in the multi-million dollar range annually. The key concern here is the lack of competition, which prevents a direct value-for-money comparison against potentially lower bids from other vendors. Without a competitive process, it's impossible to definitively state if this price is optimal or inflated relative to market rates for comparable solutions.

What are the risks associated with a sole-source award for critical IT infrastructure like SECURE64?

Sole-source awards for critical IT infrastructure present several risks. Firstly, the absence of competition can lead to inflated prices, as the government lacks leverage to negotiate the best possible terms. Secondly, it can result in vendor lock-in, making it difficult and costly to switch to alternative solutions in the future. Thirdly, there's a reduced incentive for the sole provider to innovate or offer superior service, as they face no direct competitive pressure. Finally, it raises concerns about whether the chosen solution is truly the most effective or cost-efficient available, or if it was selected due to factors other than pure merit and price.

What is Premier Systems Sales Ltd.'s track record with federal IT procurements, particularly with the IRS?

The provided data indicates Premier Systems Sales Ltd. is the contractor for this purchase order. A deeper analysis of federal procurement databases (like SAM.gov or FPDS) would be necessary to fully assess their track record. This would involve examining past contracts awarded to them, their performance history, any past performance issues or awards, and their experience with similar IT hardware and software solutions, especially within the IRS or other Treasury bureaus. Without this external data, we can only note their role in this specific sole-source award.

What are the potential long-term cost implications for the IRS if SECURE64 requires ongoing support or future upgrades?

The long-term cost implications for the IRS depend heavily on the nature of SECURE64 and Premier Systems Sales Ltd.'s pricing structure for support and upgrades. If SECURE64 is a proprietary system, the IRS may face continued sole-source procurements for maintenance, updates, and future versions, potentially at premium prices. This could lead to escalating costs over time. A thorough review of the contract's terms regarding renewal options, price adjustment clauses, and the availability of competitive alternatives for future needs would be crucial to understanding these long-term financial exposures.

How does this procurement align with the IRS's broader IT modernization strategy and cybersecurity goals?

The alignment of this SECURE64 procurement with the IRS's broader IT modernization and cybersecurity goals is not explicitly detailed in the provided data. However, any procurement of secure hardware and software is generally intended to bolster the agency's defenses against cyber threats and support its operational capabilities. If SECURE64 is a key component of the IRS's cybersecurity architecture or a necessary upgrade for aging infrastructure, it would align well. Conversely, if it represents a tactical, non-strategic purchase or a solution that doesn't integrate effectively with future plans, its alignment could be questionable. Further insight into the IRS's IT roadmap is needed for a definitive assessment.

Industry Classification

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

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - END USER

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 149 INVERNESS DR, BLUE BELL, PA, 19422

Business Categories: Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $3,434,752

Exercised Options: $2,763,978

Current Obligation: $2,763,978

Actual Outlays: $2,753,998

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline