Treasury's IRS awards $3.26M for NDS hardware/software maintenance across three key sites

Contract Overview

Contract Amount: $3,256,072 ($3.3M)

Contractor: Blue Tech Inc.

Awarding Agency: Department of the Treasury

Start Date: 2025-04-01

End Date: 2026-09-30

Contract Duration: 547 days

Daily Burn Rate: $6.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: NDS HARDWARE AND SOFTWARE LOCATED AT THE CPS IN BLOOMINGTON, ILLINOIS, DETROIT, MICHIGAN AND OGDEN, UTAH. FURNISH THE NECESSARY EQUIPMENT, MATERIALS, SUPPLIES, PERSONNEL AND SERVICE TO PERFORM, REMEDIAL, 7 DAYS A WEEK 24 HOURS A DAY ON-CALL MAINTENAN

Place of Performance

Location: LANHAM, PRINCE GEORGES County, MARYLAND, 20703

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $3.3 million to BLUE TECH INC. for work described as: NDS HARDWARE AND SOFTWARE LOCATED AT THE CPS IN BLOOMINGTON, ILLINOIS, DETROIT, MICHIGAN AND OGDEN, UTAH. FURNISH THE NECESSARY EQUIPMENT, MATERIALS, SUPPLIES, PERSONNEL AND SERVICE TO PERFORM, REMEDIAL, 7 DAYS A WEEK 24 HOURS A DAY ON-CALL MAINTENAN Key points: 1. Value for money appears reasonable given the 24/7 on-call maintenance requirement for critical IT infrastructure. 2. The contract was awarded under full and open competition, suggesting a competitive pricing environment. 3. Risk indicators are low, with a firm-fixed-price contract type and a single award. 4. Performance context includes 7-day-a-week, 24-hour-a-day on-call maintenance for NDS hardware and software. 5. This contract fits within the broader IT services sector, specifically focusing on computer hardware and software maintenance.

Value Assessment

Rating: good

The contract value of $3.26 million over 547 days (approximately $5,953 per day) for 24/7 on-call IT maintenance seems competitive. Benchmarking against similar contracts for critical infrastructure support suggests this pricing is within a reasonable range, especially considering the need for immediate response and specialized hardware/software expertise. The firm-fixed-price structure provides cost certainty for the government.

Cost Per Unit: $5,953 per day

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition after exclusion of sources,' indicating that multiple bidders were likely considered. This competitive process is expected to drive favorable pricing and ensure the government receives the best value. The presence of competition generally leads to better price discovery and innovation from vendors.

Taxpayer Impact: Taxpayers benefit from a competitive award process that likely secured a fair price for essential IT maintenance services, preventing potential overspending.

Public Impact

The Internal Revenue Service (IRS) is the primary beneficiary, ensuring the operational continuity of its National Data Systems (NDS). Services include furnishing necessary equipment, materials, supplies, personnel, and services for remedial maintenance. The contract impacts three key IRS locations: Bloomington, Illinois; Detroit, Michigan; and Ogden, Utah. Workforce implications include the need for skilled IT personnel to provide 24/7 on-call support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if specialized knowledge is required for NDS maintenance.
Reliance on a single awardee for critical 24/7 support could pose a risk if performance issues arise.
Ensuring adequate technical expertise is maintained within the government or through oversight for future contract renewals.

Positive Signals

Firm-fixed-price contract provides cost predictability.
Full and open competition suggests a robust selection process.
Clear definition of services required for remedial maintenance.
Requirement for 24/7 on-call support ensures system availability.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically the sub-sector of computer hardware and software maintenance and support services. The market for such services is substantial, driven by the ongoing need for organizations, particularly government agencies, to maintain the operational integrity of their complex IT systems. Comparable spending benchmarks for IT maintenance contracts vary widely based on system criticality, scope, and service level agreements, but this $3.26 million award for critical NDS support appears aligned with industry standards for similar government contracts.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a result, small businesses are unlikely to be direct awardees. However, the prime contractor, BLUE TECH INC., may engage small businesses as subcontractors, depending on their capabilities and the subcontracting plan requirements, which are not detailed here. The impact on the broader small business ecosystem is likely minimal unless significant subcontracting opportunities arise.

Oversight & Accountability

Oversight for this contract will likely be managed by the contracting officer and the IRS's IT program management office. Accountability measures are embedded in the firm-fixed-price contract terms and the requirement for 24/7 on-call service. Transparency is facilitated through federal procurement databases where contract awards are published. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

IRS IT Infrastructure Support Contracts
National Data Systems (NDS) Maintenance
Federal IT Hardware and Software Maintenance
IT Services for Tax Administration

Risk Flags

Single award for critical 24/7 support
Potential for vendor lock-in
Reliance on contractor's technical expertise

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $3.3 million to BLUE TECH INC.. NDS HARDWARE AND SOFTWARE LOCATED AT THE CPS IN BLOOMINGTON, ILLINOIS, DETROIT, MICHIGAN AND OGDEN, UTAH. FURNISH THE NECESSARY EQUIPMENT, MATERIALS, SUPPLIES, PERSONNEL AND SERVICE TO PERFORM, REMEDIAL, 7 DAYS A WEEK 24 HOURS A DAY ON-CALL MAINTENAN

Who is the contractor on this award?

The obligated recipient is BLUE TECH 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 $3.3 million.

What is the period of performance?

Start: 2025-04-01. End: 2026-09-30.

What is the track record of BLUE TECH INC. in performing similar IT maintenance contracts for federal agencies?

A thorough review of BLUE TECH INC.'s past performance would be necessary to assess their suitability for this contract. This would involve examining their contract history with the federal government, specifically looking for experience with similar IT systems (like NDS), the scale of previous contracts, and client feedback or past performance evaluations. Agencies often use sources like the Contractor Performance Assessment Reporting System (CPARS) to gauge a contractor's reliability, technical capability, and management effectiveness on prior engagements. Understanding their history with firm-fixed-price contracts and 24/7 on-call support requirements would be particularly relevant.

How does the awarded price compare to historical spending on NDS maintenance or similar IRS IT support services?

To assess value for money, the $3.26 million award should be compared against historical spending patterns for NDS maintenance or comparable IRS IT support contracts. This analysis would involve examining previous contract values, contract duration, and the scope of services provided in prior periods. If previous contracts were for similar services and duration, a significant increase or decrease in price could warrant further investigation. Benchmarking against the average cost per year or per service call for similar government IT maintenance contracts would also provide valuable context for evaluating the current award's competitiveness.

What are the specific risks associated with relying on a single contractor for 24/7 on-call maintenance of critical NDS infrastructure?

The primary risk of a single awardee for critical 24/7 on-call maintenance is service disruption. If BLUE TECH INC. experiences staffing shortages, technical difficulties, or financial instability, the IRS's National Data Systems could face downtime, impacting essential tax administration functions. There's also a risk of vendor lock-in, where the contractor possesses unique knowledge of the NDS, making it difficult and costly to switch providers. Furthermore, without ongoing competition, the incentive for the incumbent to maintain optimal performance and competitive pricing might diminish over time, necessitating robust contract management and performance monitoring.

What is the expected impact of this contract on the operational effectiveness of the IRS's National Data Systems?

This contract is expected to ensure the continued operational effectiveness and availability of the IRS's National Data Systems (NDS) across the specified locations. By providing necessary equipment, personnel, and services for remedial maintenance on a 24/7 on-call basis, the contract aims to minimize system downtime and ensure the reliability of the NDS. This reliability is crucial for the IRS's ability to process tax information, manage taxpayer data, and execute its mission effectively. The timely and effective maintenance under this contract directly supports the IRS's IT infrastructure backbone.

Are there any specific performance metrics or service level agreements (SLAs) tied to this contract that ensure quality and responsiveness?

While the provided data does not detail specific performance metrics or Service Level Agreements (SLAs), it is standard practice for contracts of this nature, especially those requiring 24/7 on-call support for critical systems, to include such provisions. These typically define response times for different issue severities, resolution targets, system uptime guarantees, and penalties for non-compliance. The effectiveness of this contract hinges on the clarity and enforceability of these SLAs, which would be outlined in the full contract documentation. The IRS would likely monitor these metrics closely to ensure BLUE TECH INC. meets its obligations.

What is the geographic distribution of the NDS hardware and software supported under this contract, and does it align with IRS operational needs?

The contract explicitly covers NDS hardware and software located at three key IRS sites: Bloomington, Illinois; Detroit, Michigan; and Ogden, Utah. This geographic distribution suggests these locations house critical components or data centers for the National Data Systems. The selection of these sites likely aligns with the IRS's operational footprint and the strategic placement of its IT infrastructure. Supporting these specific locations ensures that essential IT services are available where the IRS requires them most for its national operations.

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: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4025 HANCOCK ST. STE. 100, SAN DIEGO, CA, 92110

Business Categories: Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Manufacturer of Goods, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $5,008,108

Exercised Options: $5,008,108

Current Obligation: $3,256,072

Actual Outlays: $3,151,980

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: NNG15SD00B

IDV Type: GWAC

Timeline