Maximus Federal Services awarded $87.9M for IT operations and support to the Department of Labor

Contract Overview

Contract Amount: $87,883,198 ($87.9M)

Contractor: Maximus Federal Services, Inc.

Awarding Agency: Department of Labor

Start Date: 2016-09-08

End Date: 2019-05-31

Contract Duration: 995 days

Daily Burn Rate: $88.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: LABOR HOURS

Sector: IT

Official Description: IGF::CL::IGF - TASK ORDER TO REPLACE DOL-OPS-16-F-00002 IN IT'S ENTIRETY. IT OPERATIONS, MAINTENANCE AND SUPPORT SERVICES TO THE GSS

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20210

State: District of Columbia Government Spending

Plain-Language Summary

Department of Labor obligated $87.9 million to MAXIMUS FEDERAL SERVICES, INC. for work described as: IGF::CL::IGF - TASK ORDER TO REPLACE DOL-OPS-16-F-00002 IN IT'S ENTIRETY. IT OPERATIONS, MAINTENANCE AND SUPPORT SERVICES TO THE GSS Key points: 1. Contract provides essential IT operations, maintenance, and support services. 2. Full and open competition suggests a potentially competitive bidding process. 3. Duration of the task order is nearly three years. 4. Services are critical for the Office of the Assistant Secretary for Administration and Management. 5. The contract type is a delivery order under a larger contract. 6. The North American Industry Classification System (NAICS) code is 541512, indicating Computer Systems Design Services.

Value Assessment

Rating: fair

The awarded amount of $87.9 million for IT operations, maintenance, and support services over approximately three years appears to be within a reasonable range for such comprehensive services. Benchmarking against similar large-scale IT support contracts for federal agencies is necessary for a definitive value assessment. The contract's basis on labor hours (PT: LABOR HOURS) can sometimes lead to cost overruns if not managed tightly, but it also offers flexibility. The base award amount of $88.3 million suggests the task order was awarded close to its potential ceiling.

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 a bid. The presence of two bidders (NO: 2) suggests a moderate level of competition for this specific task order. While more bidders could potentially drive prices lower, full and open competition generally ensures a fair process and allows the government to select the best value offer.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best possible price and quality for essential IT services, reducing the risk of overpayment.

Public Impact

Employees and contractors within the Department of Labor benefit from reliable IT infrastructure and support. The contract ensures the continuity of critical IT operations necessary for the agency's mission. Services are delivered within the District of Columbia, impacting the local IT support ecosystem. The contract supports jobs in IT operations, maintenance, and technical support roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost creep due to labor hour pricing if not closely monitored.
Limited competition (2 bidders) might not have yielded the absolute lowest price.
Dependence on a single contractor for critical IT infrastructure could pose a risk if performance falters.

Positive Signals

Awarded under full and open competition, ensuring a fair process.
Contract provides essential IT services crucial for agency operations.
Task order replaces a previous one, suggesting an established need and potentially refined requirements.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computer systems design and related services. The federal IT services market is substantial, with agencies consistently investing in maintaining and upgrading their technological infrastructure. This contract represents a significant portion of spending for IT operations and maintenance within the Department of Labor, aligning with broader government efforts to modernize IT systems and ensure operational efficiency.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (SB: false, SS: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. However, the prime contractor, MAXIMUS FEDERAL SERVICES, INC., may engage small businesses as subcontractors, though this information is not detailed in the provided data.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Labor's contracting officers and program managers. The Inspector General's office for the Department of Labor would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance metrics and oversight activities are not detailed here.

Related Government Programs

Department of Labor IT Modernization Efforts
Federal IT Operations and Maintenance Contracts
Computer Systems Design Services
IT Support Services for Government Agencies

Risk Flags

Potential for cost overruns due to labor hour pricing.
Limited competition (2 bidders) may impact price competitiveness.
Dependence on contractor for critical IT infrastructure.
Cybersecurity risks associated with IT operations.

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $87.9 million to MAXIMUS FEDERAL SERVICES, INC.. IGF::CL::IGF - TASK ORDER TO REPLACE DOL-OPS-16-F-00002 IN IT'S ENTIRETY. IT OPERATIONS, MAINTENANCE AND SUPPORT SERVICES TO THE GSS

Who is the contractor on this award?

The obligated recipient is MAXIMUS FEDERAL SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Labor (Office of the Assistant Secretary for Administration and Management).

What is the total obligated amount?

The obligated amount is $87.9 million.

What is the period of performance?

Start: 2016-09-08. End: 2019-05-31.

What is the track record of MAXIMUS FEDERAL SERVICES, INC. with the Department of Labor and similar federal IT contracts?

MAXIMUS FEDERAL SERVICES, INC. has a history of performing IT operations, maintenance, and support services for various federal agencies, including the Department of Labor. Their track record typically involves managing complex IT infrastructures, ensuring system uptime, and providing technical support. Reviewing past performance evaluations and any documented issues on similar contracts would provide a clearer picture of their reliability and effectiveness. Specific data on past performance quality, such as CPARS ratings, would be crucial for a comprehensive assessment. Their experience with large-scale IT task orders suggests they possess the capacity to handle the scope of this contract.

How does the awarded amount compare to similar IT operations and maintenance contracts for federal agencies of similar size?

The $87.9 million awarded to MAXIMUS FEDERAL SERVICES, INC. for IT operations, maintenance, and support services over approximately 34 months (995 days) needs to be benchmarked against comparable contracts. A rough daily rate can be estimated at approximately $88,200 per day ($87.9M / 995 days). Federal IT support contracts vary widely based on scope, complexity, and agency-specific requirements. Contracts for agencies with similar IT footprints and operational needs could serve as benchmarks. Without access to detailed scope-of-work comparisons and specific service level agreements, it's challenging to definitively state if this represents superior or inferior value. However, the full and open competition suggests an effort to achieve competitive pricing.

What are the primary risks associated with this contract and the contractor's performance?

Key risks include potential cost overruns due to the labor-hour pricing model if not managed diligently, contractor performance issues impacting critical IT services, and cybersecurity vulnerabilities. Dependence on a single contractor for essential IT functions also presents a risk if the contractor fails to meet performance standards or experiences financial instability. The limited competition (2 bidders) could also imply a risk of less aggressive pricing than might be achieved with broader competition. Furthermore, the transition of services, especially if replacing an incumbent, carries inherent risks of disruption.

How effective is the Department of Labor in overseeing IT contracts of this magnitude?

The effectiveness of the Department of Labor's oversight depends on several factors, including the expertise of its contracting officers, the robustness of its performance management processes, and the clarity of the contract's performance work statement (PWS). The presence of an Inspector General's office suggests a mechanism for accountability. However, the provided data does not detail the specific oversight mechanisms employed for this task order, such as regular performance reviews, audits, or the use of independent government cost estimators. Effective oversight is crucial to ensure the contractor delivers services as specified and that taxpayer funds are used efficiently.

What has been the historical spending trend for IT operations and maintenance within the Department of Labor?

Historical spending data for IT operations and maintenance within the Department of Labor would provide context for the $87.9 million awarded in this task order. Analyzing trends over the past 5-10 years would reveal whether spending in this category is increasing, decreasing, or remaining stable. This analysis could indicate shifts in IT strategy, the impact of modernization initiatives, or changes in the agency's overall IT footprint. Understanding historical spending patterns helps in assessing the reasonableness of current investments and identifying potential areas for cost savings or efficiency improvements.

What is the significance of the NAICS code 541512 (Computer Systems Design Services) in relation to the contract's stated purpose?

The NAICS code 541512, 'Computer Systems Design Services,' is appropriate for a contract focused on IT operations, maintenance, and support. This classification encompasses establishments primarily engaged in planning and designing computer systems that integrate hardware, software, and communication technologies. While the contract emphasizes operations and maintenance, the design and integration aspects are often inherent in providing comprehensive IT support. This code suggests the contractor is expected to not only maintain existing systems but potentially advise on or implement improvements, aligning with the broader goal of ensuring efficient and effective IT infrastructure for the agency.

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 › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Parent Company: Maximus Inc

Address: 3120 FAIRVIEW PARK DR STE 400, FALLS CHURCH, VA, 22042

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $91,353,915

Exercised Options: $91,353,915

Current Obligation: $87,883,198

Actual Outlays: $13,495,355

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSN316201600006W

IDV Type: GWAC

Timeline