DOE awards $38M IT support contract to Maximus Federal Consulting, highlighting system design services

Contract Overview

Contract Amount: $37,952,852 ($38.0M)

Contractor: Maximus Federal Consulting, LLC

Awarding Agency: Department of Energy

Start Date: 2023-08-01

End Date: 2025-01-31

Contract Duration: 549 days

Daily Burn Rate: $69.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: INTERIM INFORMATION TECHNOLOGY SUPPORT SERVICES

Place of Performance

Location: MORGANTOWN, MONONGALIA County, WEST VIRGINIA, 26501

State: West Virginia Government Spending

Plain-Language Summary

Department of Energy obligated $38.0 million to MAXIMUS FEDERAL CONSULTING, LLC for work described as: INTERIM INFORMATION TECHNOLOGY SUPPORT SERVICES Key points: 1. Contract focuses on computer systems design, a critical area for agency operations. 2. The award was made under full and open competition, suggesting a robust bidding process. 3. Performance period spans over 1.5 years, indicating a medium-term need for these services. 4. The contract type is Cost Plus Fixed Fee, which allows for flexibility but requires careful cost monitoring. 5. This award represents a significant investment in IT infrastructure for the Department of Energy. 6. The geographic location of performance is West Virginia, potentially impacting regional IT employment.

Value Assessment

Rating: good

The contract value of approximately $38 million over 18 months suggests a substantial but not exceptionally high annual spend for IT support services. Benchmarking against similar large-scale IT system design contracts within federal agencies would provide a clearer picture of value for money. The Cost Plus Fixed Fee (CPFF) structure implies that while the contractor's fee is fixed, the direct costs are reimbursed, necessitating diligent oversight to ensure cost efficiency. Without specific comparable contract data, it's difficult to definitively assess if the pricing is optimal, but the competitive award process is a positive indicator.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition after exclusion of sources,' indicating that the solicitation was broadly advertised, and multiple responsible sources were permitted to submit offers. While the specific number of bidders is not provided, this procurement method generally fosters a competitive environment, which is expected to lead to better pricing and service quality for the government. The exclusion of sources clause might suggest a specific technical requirement or a prior relationship that was nevertheless subjected to open competition.

Taxpayer Impact: A full and open competition generally benefits taxpayers by encouraging a wider range of companies to bid, potentially driving down costs and improving the quality of services received. This process helps ensure that the government is not limited to a few providers, leading to more efficient use of public funds.

Public Impact

The Department of Energy benefits from enhanced IT system design and support capabilities. Federal agencies receive improved infrastructure for managing complex energy-related data and operations. The contract supports IT professionals and potentially creates jobs within the IT services sector. Residents and businesses in West Virginia may see indirect economic benefits through contract-related employment and economic activity.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts require rigorous oversight to manage direct costs effectively and prevent potential cost overruns.
The 'exclusion of sources' clause, while part of an open competition, warrants understanding the specific rationale to ensure no undue limitations were placed on potential bidders.
Ensuring the contractor's proposed solutions align with long-term IT modernization goals and cybersecurity best practices is crucial.

Positive Signals

Awarded through full and open competition, indicating a competitive marketplace was leveraged.
The contract duration of over 1.5 years suggests a stable, ongoing need for these critical IT services.
Focus on computer systems design aligns with the government's push for modern, efficient IT infrastructure.

Sector Analysis

The IT services sector, particularly computer systems design, is a significant component of federal spending. Agencies rely heavily on these services for everything from maintaining legacy systems to developing cutting-edge digital solutions. The Department of Energy, managing vast amounts of data and complex operational systems, is a major consumer of such services. Comparable spending benchmarks for IT system design contracts within large federal agencies often range from tens to hundreds of millions of dollars, depending on the scope and duration.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting opportunities mandated for small businesses through a set-aside program for this specific award. However, the prime contractor, Maximus Federal Consulting, LLC, may still engage small businesses as subcontractors to fulfill aspects of the contract, depending on their own subcontracting strategies and the nature of the work required.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract will likely involve regular reviews of incurred costs, progress reports, and performance metrics by the Department of Energy's contracting officer and technical representatives. Accountability measures are built into the CPFF structure through the fixed fee, which incentivizes the contractor to manage costs efficiently. Transparency is typically maintained through contract reporting requirements and public contract databases, though specific internal oversight details may not be publicly disclosed. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

IT Infrastructure Modernization Programs
Cloud Computing Services Contracts
Cybersecurity Support Services
Enterprise Resource Planning (ERP) System Implementation
Data Center Operations and Management

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage costs.
Potential for scope creep in IT system design projects.
Ensuring long-term system maintainability and scalability.
Cybersecurity vulnerabilities in newly designed systems.

Frequently Asked Questions

What is this federal contract paying for?

Department of Energy awarded $38.0 million to MAXIMUS FEDERAL CONSULTING, LLC. INTERIM INFORMATION TECHNOLOGY SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is MAXIMUS FEDERAL CONSULTING, LLC.

Which agency awarded this contract?

Awarding agency: Department of Energy (Department of Energy).

What is the total obligated amount?

The obligated amount is $38.0 million.

What is the period of performance?

Start: 2023-08-01. End: 2025-01-31.

What is the track record of Maximus Federal Consulting, LLC in delivering similar IT system design services to the federal government?

Maximus Federal Consulting, LLC has a substantial history of providing IT and consulting services to various federal agencies. Their experience often includes large-scale system implementations, IT modernization efforts, and data management solutions. While specific details on past performance for contracts precisely matching 'Computer Systems Design Services' (NAICS 541512) of this magnitude would require deeper analysis of contract databases like FPDS or SAM.gov, Maximus generally demonstrates capability in managing complex IT projects. Their portfolio typically includes work in areas such as health IT, financial systems, and citizen services, indicating a broad range of technical and project management expertise relevant to federal IT needs. Evaluating past performance on similar contracts, including client satisfaction, adherence to schedule and budget, and technical execution, is crucial for assessing their suitability for this Department of Energy award.

How does the awarded value of $37.95 million compare to similar IT system design contracts awarded by the Department of Energy or other large federal agencies?

The awarded value of approximately $37.95 million for interim IT support services over a period of roughly 1.5 years (August 2023 - January 2025) places this contract in the mid-to-large tier for IT services within the federal government. For context, large federal agencies like the Department of Defense, Health and Human Services, or even other components within the Department of Energy, frequently award IT system design and support contracts ranging from tens of millions to hundreds of millions of dollars, and sometimes even billions for enterprise-wide transformations. This specific award's value per year is roughly $25.3 million, which is a significant but not extraordinary figure for specialized IT system design services. Benchmarking against contracts with similar scope (system design, IT support) and duration within the last 2-3 years across agencies of comparable size and IT complexity would provide a more precise comparison point for assessing value for money.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract type for IT system design services?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract type, like the one awarded to Maximus Federal Consulting, is the potential for cost escalation if not managed diligently. While the contractor's fee is fixed, the government reimburses the direct costs incurred. This can incentivize contractors to incur higher costs than necessary, as their profit margin (the fixed fee) remains constant regardless of the actual costs. For the government, this necessitates robust oversight mechanisms to scrutinize all claimed costs, ensure they are reasonable, allocable, and allowable, and that the contractor is employing efficient practices. Another risk is that the contractor might prioritize cost-reimbursable activities over innovative, cost-saving solutions if those solutions require upfront investment not directly covered or if they reduce the overall cost base upon which the fixed fee is calculated. Effective contract administration, clear performance standards, and regular audits are critical to mitigating these risks.

What does the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' designation imply for the procurement process and potential bidder pool?

The designation 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' indicates a nuanced procurement approach. 'Full and open competition' means the solicitation was made available to all responsible sources, and any responsible source could submit an offer. However, the 'after exclusion of sources' part suggests that specific sources were initially considered or perhaps even solicited, but then the agency decided to open the competition more broadly, possibly after realizing that excluding certain sources might have been unnecessary or that a wider pool could yield better results. Alternatively, it could mean that after an initial limited solicitation or sole-source justification, the agency determined that full and open competition was feasible and preferable. This designation generally implies a robust effort to achieve best value through broad market participation, while potentially acknowledging a prior consideration of specific vendors or circumstances that led to the exclusion initially.

How has federal spending on IT system design services (NAICS 541512) trended over the past five years, and where does this contract fit within that trend?

Federal spending on IT system design services, categorized under NAICS code 541512, has generally shown a consistent upward trend over the past five years, driven by the ongoing digital transformation initiatives across government agencies. Agencies are increasingly reliant on sophisticated IT systems for operations, data analysis, cybersecurity, and citizen engagement. Spending in this category typically fluctuates based on major modernization projects, agency budget cycles, and evolving technological needs. The Department of Energy's award of $37.95 million fits within the typical range for significant IT system design contracts. While not a mega-contract, it represents a substantial investment for a specific need, reflecting the broader federal commitment to enhancing IT capabilities. This contract aligns with the overall trend of sustained, significant federal investment in specialized IT design and support services.

Industry Classification

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

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

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: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Maximus Federal Consulting LLC

Address: 1600 TYSONS BLVD, MCLEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $38,594,586

Exercised Options: $38,594,586

Current Obligation: $37,952,852

Actual Outlays: $37,649,341

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSN316201200117W

IDV Type: GWAC

Timeline