SEC's $18.2M MIDAS contract awarded to Refinitiv US LLC for custom programming services

Contract Overview

Contract Amount: $18,235,540 ($18.2M)

Contractor: Refinitiv US LLC

Awarding Agency: Securities and Exchange Commission

Start Date: 2023-01-02

End Date: 2027-01-01

Contract Duration: 1,460 days

Daily Burn Rate: $12.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: MARKET INFORMATION DATA AND ANALYTICS SYSTEM (MIDAS)

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10001

State: New York Government Spending

Plain-Language Summary

Securities and Exchange Commission obligated $18.2 million to REFINITIV US LLC for work described as: MARKET INFORMATION DATA AND ANALYTICS SYSTEM (MIDAS) Key points: 1. Contract awarded on a sole-source basis, limiting potential cost savings from competition. 2. The firm fixed-price contract structure provides cost certainty for the government. 3. Contract duration of 4 years suggests a long-term need for these services. 4. The North American Industry Classification System (NAICS) code 541511 indicates a focus on custom software development. 5. The Securities and Exchange Commission (SEC) is the primary agency involved. 6. The contract is not set aside for small businesses, potentially impacting small business participation.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to the lack of competitive bidding. The firm fixed-price structure is generally favorable for cost control, but without comparison to other bids or market rates for similar custom programming services, it's difficult to definitively assess if the $18.2 million represents excellent value. The duration of the contract suggests a significant investment, and ongoing monitoring of performance and cost against deliverables will be crucial.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor possesses the necessary capabilities or when urgency dictates a rapid award. The lack of competition means there was no opportunity for price discovery through a bidding process, which could potentially lead to higher costs for the government compared to a competitively awarded contract.

Taxpayer Impact: Taxpayers may not benefit from the cost efficiencies that typically arise from a competitive bidding process. The absence of multiple offers means the government did not leverage market forces to secure the best possible price.

Public Impact

The primary beneficiary is the Securities and Exchange Commission (SEC), which will receive custom computer programming services. The services delivered are expected to support the SEC's mission in market data and analytics. The contract is geographically focused on New York, where Refinitiv US LLC is located. The contract may have implications for the IT workforce, potentially requiring specialized skills for development and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential cost savings.
Lack of transparency in the sole-source justification process.
Potential for vendor lock-in due to the long-term nature of the contract and specialized services.

Positive Signals

Firm fixed-price contract provides budget certainty.
Long-term contract duration indicates a stable, ongoing need for critical services.
Award to an established entity (Refinitiv) may suggest a level of confidence in their capabilities.

Sector Analysis

The IT services sector, particularly custom computer programming, is a significant area of federal spending. This contract falls under the broader category of IT services, which includes software development, system integration, and IT consulting. The market for such services is competitive, but specialized needs can sometimes lead to sole-source awards. Benchmarking against similar custom programming contracts for federal agencies can provide insights into pricing, though direct comparisons are difficult without detailed scope of work.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. This means that opportunities for small businesses to participate in this specific contract are limited unless they are part of the prime contractor's supply chain in a non-set-aside capacity. The overall impact on the small business ecosystem for IT services would depend on the broader contracting landscape within the SEC and other agencies.

Oversight & Accountability

Oversight for this contract would primarily fall under the Securities and Exchange Commission's contracting officers and program managers. Accountability measures would be defined within the contract's performance work statement and terms. Transparency is limited due to the sole-source nature of the award, but contract details and performance reports may be available through federal procurement databases. The Inspector General's office for the SEC would have jurisdiction for audits and investigations if any concerns arise.

Related Government Programs

Market Information Data and Analytics Systems
Custom Computer Programming Services
Information Technology Services
Securities and Exchange Commission IT Contracts

Risk Flags

Sole-source award
Potential for cost overruns if scope is not well-defined
Lack of competitive benchmarking

Frequently Asked Questions

What is this federal contract paying for?

Securities and Exchange Commission awarded $18.2 million to REFINITIV US LLC. MARKET INFORMATION DATA AND ANALYTICS SYSTEM (MIDAS)

Who is the contractor on this award?

The obligated recipient is REFINITIV US LLC.

Which agency awarded this contract?

Awarding agency: Securities and Exchange Commission (Securities and Exchange Commission).

What is the total obligated amount?

The obligated amount is $18.2 million.

What is the period of performance?

Start: 2023-01-02. End: 2027-01-01.

What is the track record of Refinitiv US LLC with the federal government, particularly with the SEC?

Refinitiv US LLC, a subsidiary of LSEG (London Stock Exchange Group), has a history of providing data and analytics services to various entities, including government agencies. While specific contract details with the SEC prior to this award are not detailed here, their parent company's broader engagement with financial markets suggests familiarity with regulatory data needs. A deeper dive into federal procurement databases like FPDS or SAM.gov would reveal the extent and nature of their past federal awards, including performance history and any reported issues. Understanding their prior performance on similar contracts is crucial for assessing the risk associated with this significant award.

How does the $18.2 million contract value compare to similar custom programming contracts awarded by the SEC or other agencies?

Direct comparison of the $18.2 million contract value for custom programming services is challenging without a detailed scope of work and specific performance metrics. However, federal agencies frequently award large contracts for IT development and data systems. For instance, contracts for enterprise resource planning (ERP) systems, large-scale database development, or cybersecurity solutions can range from millions to hundreds of millions of dollars. The value of this MIDAS contract appears substantial, reflecting a significant investment in specialized data and analytics capabilities. Benchmarking against contracts with similar NAICS codes (541511) and contract types (firm fixed-price) awarded to companies of comparable size and expertise would provide a more relevant context for assessing value for money.

What are the primary risks associated with a sole-source award for custom programming services?

The primary risk associated with a sole-source award for custom programming services is the lack of competitive pressure, which can lead to inflated pricing and reduced innovation. Without multiple vendors vying for the contract, the government may not secure the most cost-effective solution. There's also a risk of vendor lock-in, where the agency becomes heavily reliant on the incumbent provider, making future transitions difficult and potentially expensive. Furthermore, the absence of a competitive process can sometimes mask underlying issues with the chosen vendor's capabilities or past performance, as there's no external validation through a bidding process. Ensuring robust contract management and performance monitoring becomes even more critical in sole-source situations.

How effective is the firm fixed-price contract type in managing costs for custom programming projects?

The firm fixed-price (FFP) contract type is generally considered effective for managing costs in custom programming projects when the scope of work is well-defined and unlikely to change significantly. It shifts the risk of cost overruns to the contractor, providing the government with budget certainty. However, for highly complex or evolving custom programming needs, an FFP contract can sometimes stifle flexibility. If unforeseen technical challenges arise or requirements change, the contractor may be less willing to accommodate modifications without significant change orders, potentially leading to disputes or delays. For projects with inherent uncertainty, other contract types like cost-plus-fixed-fee or time-and-materials might offer more flexibility, albeit with less cost certainty for the government.

What are the historical spending patterns for custom computer programming services at the SEC?

Analyzing historical spending patterns for custom computer programming services at the SEC would require a review of past contract awards. Agencies like the SEC, which deal with vast amounts of financial data and complex regulatory frameworks, typically have ongoing needs for IT development and system enhancements. Spending in this area can fluctuate based on strategic initiatives, system modernization efforts, and evolving technological landscapes. A trend analysis of SEC's IT spending, specifically under NAICS code 541511, over the past several fiscal years would reveal whether this $18.2 million contract represents an increase, decrease, or continuation of previous investment levels in custom programming.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 50310223R0003

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 28 LIBERTY STREET, 58TH FLOOR, NEW YORK, NY, 10005

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign-Owned and U.S.-Incorporated Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $23,091,153

Exercised Options: $18,235,540

Current Obligation: $18,235,540

Actual Outlays: $12,446,181

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline