VA awards $2.06M option for IT services to Deloitte, extending contract through late 2026

Contract Overview

Contract Amount: $2,058,181 ($2.1M)

Contractor: Deloitte & Touche LLP

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-09-19

End Date: 2026-11-30

Contract Duration: 1,168 days

Daily Burn Rate: $1.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: EXERCISE OF OPTION 2 FOR POP TASK ORDER

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20420

State: District of Columbia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $2.1 million to DELOITTE & TOUCHE LLP for work described as: EXERCISE OF OPTION 2 FOR POP TASK ORDER Key points: 1. Contract value represents a modest increase for ongoing IT support. 2. Competition was full and open, suggesting a competitive bidding process. 3. Fixed-price contract type helps mitigate cost overrun risks. 4. Contract duration extends over two years, indicating a need for sustained services. 5. The award is for IT services, a critical area for agency operations. 6. Deloitte & Touche LLP is the incumbent contractor for these services.

Value Assessment

Rating: good

The contract value of approximately $2.06 million for an 1168-day period (roughly 3.2 years) appears reasonable for IT support services. While specific benchmarks for 'POP Task Order' services are not provided, the firm fixed-price structure is generally favorable for cost control. Comparing this to similar IT support contracts within the VA or other large federal agencies would provide a more precise value-for-money assessment, but the pricing seems within expected ranges for professional IT services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The data shows 3 bidders participated in this round. A competitive process like this generally leads to better price discovery and potentially more innovative solutions as contractors vie for the award. The level of competition suggests that the market is capable of providing these services and that the VA is likely to receive a fair price.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best value for their money. Full and open competition helps ensure that the government isn't overpaying for services and that resources are allocated efficiently.

Public Impact

The Department of Veterans Affairs benefits from continued IT support, ensuring smooth operations of its systems. Veterans may indirectly benefit from improved IT infrastructure supporting their healthcare and benefits. The contract supports IT services within the District of Columbia. The contract likely supports a workforce of IT professionals employed by Deloitte & Touche LLP.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if future requirements are heavily tailored to Deloitte's current solutions.
Reliance on a single contractor for critical IT functions could pose a risk if performance degrades.
The specific nature of 'POP Task Order' is not detailed, making it difficult to assess the full scope of work and associated risks.

Positive Signals

Firm fixed-price contract limits the government's exposure to cost increases.
Full and open competition suggests a healthy market and competitive pricing.
Contract duration provides stability for essential IT services.

Sector Analysis

This contract falls within the broader Information Technology (IT) sector, specifically under 'Other Computer Related Services.' The IT services market within the federal government is substantial, with agencies like the VA being major consumers. This contract represents a small portion of overall federal IT spending, but it is crucial for the VA's operational continuity. Comparable spending benchmarks would involve looking at other IT support contracts for large federal agencies, which often run into millions of dollars annually.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications mandated by a small business set-aside. However, the prime contractor, Deloitte & Touche LLP, may choose to subcontract portions of the work to small businesses as part of their own business strategy, which could indirectly benefit the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the Department of Veterans Affairs. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver services at the agreed-upon price. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract were suspected.

Related Government Programs

VA IT Modernization
Federal Civilian IT Services
IT Professional Services
Cloud Computing Services
Cybersecurity Services

Risk Flags

Contract Duration
Incumbent Contractor
IT Services
Option Exercise

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $2.1 million to DELOITTE & TOUCHE LLP. EXERCISE OF OPTION 2 FOR POP TASK ORDER

Who is the contractor on this award?

The obligated recipient is DELOITTE & TOUCHE LLP.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $2.1 million.

What is the period of performance?

Start: 2023-09-19. End: 2026-11-30.

What is the historical spending pattern for this specific task order or contract vehicle with Deloitte & Touche LLP?

Analyzing historical spending for this specific task order or contract vehicle would require access to detailed contract modification history and previous award data. Without that granular information, we can only infer from the current award. The current award is an exercise of Option 2, suggesting there were prior periods of performance and funding. The total value of this option is $2,058,181.21, with a duration of 1168 days. To understand the historical pattern, one would need to examine the value and duration of Option 1, the base period, and any other preceding task orders under the same contract vehicle. This would reveal trends in spending, potential increases or decreases in scope, and the overall longevity of the relationship with Deloitte for these services. A consistent or escalating spending pattern might indicate growing needs or successful service delivery, while a declining pattern could suggest scope reduction or transition to other solutions.

How does the per-unit cost of these IT services compare to industry benchmarks or similar government contracts?

Determining a precise per-unit cost benchmark for these IT services is challenging without more specific details on the 'POP Task Order' deliverables. The contract is for 'Other Computer Related Services' under a firm fixed-price structure. To benchmark, we would need to know the specific services rendered (e.g., hours of support, number of systems managed, specific software development tasks). If we assume an average IT professional's loaded cost (salary, benefits, overhead) is around $150-$250 per hour, and this contract spans approximately 3.2 years (1168 days / 365 days/year), the total hours would need to be calculated. For instance, if the contract supported 5 full-time equivalent IT professionals, that would be roughly 5 * 2080 hours/year * 3.2 years = 33,280 hours. Dividing the total contract value ($2,058,181.21) by these hours yields approximately $61.85 per hour. This rate appears exceptionally low for professional IT services, suggesting either a very high number of personnel are not implied, or the 'per-unit' is not directly tied to labor hours in a simple way, or the benchmark is misapplied. More likely, the 'per-unit' is not easily calculable or comparable without deeper insight into the service delivery model.

What is Deloitte & Touche LLP's track record with the Department of Veterans Affairs, particularly in IT services?

Deloitte & Touche LLP has a significant track record of performing IT and professional services for the Department of Veterans Affairs (VA). As the incumbent contractor for this specific task order, their performance history directly relates to the services being continued. Publicly available contract databases often show a history of awards to Deloitte across various VA programs, including IT modernization, data analytics, and consulting. Assessing their overall track record would involve reviewing past performance evaluations (if available), any past performance issues or disputes, and the successful completion of previous task orders. Given that this is an exercise of Option 2, it implies a level of satisfaction with their performance on the preceding periods. However, a comprehensive review would necessitate examining specific performance metrics and feedback from the VA program office.

What are the primary risks associated with this contract, and how are they being mitigated?

The primary risks associated with this contract include potential performance issues, cost overruns (though mitigated by fixed-price), and vendor lock-in. Performance risks are inherent in any service contract; if Deloitte fails to deliver the required IT support effectively, it could disrupt VA operations. Mitigation typically involves clear performance standards in the contract, regular monitoring by the VA, and defined remedies for non-performance. Cost overruns are largely mitigated by the 'Firm Fixed Price' (FFP) contract type, meaning Deloitte bears the risk of increased costs. However, scope creep could still lead to requests for additional funding if not managed carefully. Vendor lock-in is a longer-term risk; if the VA becomes overly reliant on Deloitte's specific solutions or expertise, transitioning to a new vendor later could be complex and costly. Mitigation involves ensuring contract flexibility, maintaining good documentation, and periodically assessing the market for alternative solutions.

How does this contract align with the VA's broader IT modernization and digital transformation goals?

This contract, focused on 'Other Computer Related Services' for a 'POP Task Order,' likely aligns with the VA's ongoing IT modernization efforts by providing essential support for existing systems or enabling specific functionalities. While the exact nature of the 'POP Task Order' isn't detailed, IT services are fundamental to any modernization strategy. Whether it supports legacy system maintenance, facilitates data migration, enhances cybersecurity, or enables new digital services, its continuity is crucial. The VA has ambitious goals for digital transformation to improve veteran services, and contracts like this ensure the underlying IT infrastructure and support are in place. The extension of services through late 2026 suggests these IT functions are considered necessary for the foreseeable future, supporting the VA's strategic objectives.

Industry Classification

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

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

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte Consulting LLP

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $2,058,181

Exercised Options: $2,058,181

Current Obligation: $2,058,181

Actual Outlays: $1,654,571

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS00F029DA

IDV Type: FSS

Timeline