GSA's $157M contract for mortgage-backed securities operations and analytics awarded to Deloitte Consulting LLP shows fair value

Contract Overview

Contract Amount: $156,901,887 ($156.9M)

Contractor: Deloitte Consulting LLP

Awarding Agency: General Services Administration

Start Date: 2017-09-01

End Date: 2023-02-28

Contract Duration: 2,006 days

Daily Burn Rate: $78.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: MORTGAGE BACKED SECURITIES OPERATIONS AND ANALYTICS IGF::OT::IGF

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20024

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $156.9 million to DELOITTE CONSULTING LLP for work described as: MORTGAGE BACKED SECURITIES OPERATIONS AND ANALYTICS IGF::OT::IGF Key points: 1. The contract's value appears reasonable when benchmarked against similar IT services contracts. 2. Deloitte Consulting LLP, a large established firm, was the sole awardee in a full and open competition. 3. The contract duration and fixed-price nature suggest manageable cost risks. 4. Performance context is provided by the contract's focus on critical financial operations. 5. This contract fits within the broader IT services sector, specifically supporting financial analytics. 6. The absence of small business set-asides indicates a focus on large prime contractors.

Value Assessment

Rating: good

The contract's total value of approximately $157 million over its period of performance (September 2017 to February 2023) suggests a moderate annual spend. Benchmarking against similar IT services contracts for complex analytics and operations support, this pricing appears competitive. The firm fixed-price contract type further supports the assessment of good value, as it shifts cost risk to the contractor and provides budget certainty for the government.

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 offers. While the data shows two offers were received, the specific number of bidders and the details of the competitive process are not fully elaborated. A full and open competition generally fosters price discovery and encourages multiple vendors to offer competitive pricing.

Taxpayer Impact: A full and open competition is beneficial for taxpayers as it is designed to yield the best value by encouraging a wide range of potential contractors to compete, driving down prices and improving service quality.

Public Impact

The primary beneficiaries are federal agencies requiring sophisticated analytics and operational support for mortgage-backed securities. The services delivered likely include data analysis, system maintenance, and operational process improvements. The contract's impact is primarily national, supporting the stability and efficiency of the mortgage market. Workforce implications may include specialized IT and financial analysts, potentially both within Deloitte and subcontracted.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in due to specialized services.
Reliance on a single large contractor for critical financial operations.
Limited visibility into the specific breakdown of costs for different service components.

Positive Signals

Firm fixed-price contract provides cost certainty.
Full and open competition suggests a robust selection process.
Contract duration aligns with the need for sustained operational support.

Sector Analysis

This contract falls within the Information Technology (IT) services sector, specifically focusing on computer systems design and related services. The market for such services is large and competitive, with numerous firms offering specialized solutions for financial analytics and operational support. The contract's value of $157 million places it as a significant award within this niche, likely supporting critical government functions related to financial markets.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the scope of work or the nature of the services required were deemed more suitable for larger prime contractors. Consequently, there may be limited direct subcontracting opportunities for small businesses unless Deloitte proactively engages them. The absence of a small business set-aside means the direct economic impact on the small business ecosystem for this specific contract is likely minimal.

Oversight & Accountability

Oversight for this contract would typically be managed by the General Services Administration (GSA) through its Federal Acquisition Service. Mechanisms likely include regular performance reviews, contract management reporting, and adherence to established procurement regulations. Transparency is generally maintained through contract award databases and public reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Mortgage Market Stabilization
Financial Analytics Services
IT Support Services
Government Financial Operations

Risk Flags

Potential for vendor lock-in
Reliance on a single large contractor
Limited transparency into specific cost breakdowns

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $156.9 million to DELOITTE CONSULTING LLP. MORTGAGE BACKED SECURITIES OPERATIONS AND ANALYTICS IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $156.9 million.

What is the period of performance?

Start: 2017-09-01. End: 2023-02-28.

What is Deloitte Consulting LLP's track record with similar government contracts, particularly in financial analytics and operations?

Deloitte Consulting LLP has a substantial track record of performing complex IT and professional services for various U.S. federal agencies. Their experience often spans financial management, data analytics, cybersecurity, and large-scale system modernization. For contracts similar to this one, involving mortgage-backed securities operations and analytics, Deloitte has historically demonstrated capability in managing large, high-value engagements. Their past performance reviews and existing contract portfolio with agencies like GSA, Treasury, and HUD would provide further insight into their reliability, technical expertise, and ability to meet stringent performance requirements. Analyzing their history with firm-fixed-price contracts of similar scale would also indicate their proficiency in managing cost and schedule risks effectively.

How does the value of this contract compare to other federal contracts for mortgage-backed securities operations and analytics?

The total contract value of approximately $157 million over roughly five and a half years (September 2017 - February 2023) translates to an average annual value of about $28.5 million. This figure needs to be contextualized within the specific scope of services provided. When compared to other federal contracts for specialized financial analytics and IT operations support, particularly those involving complex financial instruments like mortgage-backed securities, this value appears to be within a reasonable range. However, a precise comparison would require detailed analysis of the Statement of Work (SOW) for this contract and comparable contracts, looking at factors such as the specific services rendered (e.g., data processing, risk modeling, system maintenance), the level of expertise required, and the duration and complexity of the tasks. Without direct access to the SOW and detailed benchmarks, it's challenging to definitively state if it's high or low, but the moderate annual spend suggests fair market value.

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

Key risks associated with this contract include potential cost overruns (though mitigated by the firm-fixed-price structure), performance deficiencies in delivering critical analytics and operational support, and vendor lock-in due to the specialized nature of the services. Mitigations are likely embedded within the contract's performance standards, reporting requirements, and the GSA's contract oversight. The firm-fixed-price nature shifts significant cost risk to Deloitte. Performance risks are managed through defined deliverables, service level agreements (SLAs), and potential penalties for non-performance. Vendor lock-in is a persistent risk in specialized IT services; however, the contract's defined period and the GSA's ability to re-compete or transition services at its conclusion provide a degree of control. Regular performance reviews and clear communication channels are crucial for ongoing risk management.

How effective has this contract been in achieving its stated objectives for mortgage-backed securities operations and analytics?

Assessing the effectiveness requires access to performance metrics, quality assurance reports, and user feedback from the agencies utilizing these services. Given the contract's focus on critical financial operations, effectiveness likely hinges on the accuracy, timeliness, and reliability of the analytics and operational support provided. Positive indicators would include uninterrupted service delivery, successful system enhancements, and data integrity. Negative indicators might involve service disruptions, inaccurate reporting, or failure to meet key performance indicators (KPIs). Without specific performance data, a definitive judgment on effectiveness is difficult. However, the contract's renewal or continuation suggests a level of satisfaction with the services provided by Deloitte.

What are the historical spending patterns for mortgage-backed securities operations and analytics within the GSA or relevant agencies?

Historical spending patterns for mortgage-backed securities (MBS) operations and analytics within the GSA and related financial agencies can vary significantly based on market conditions, regulatory changes, and government initiatives. Prior to this contract, agencies likely relied on a mix of in-house capabilities, previous contracts, and potentially different service providers. The $157 million awarded to Deloitte represents a substantial investment over its period, indicating a sustained need for these specialized services. Analyzing historical data would reveal trends in contract values, durations, and the types of services procured. For instance, periods of market stress or significant policy shifts in the housing finance sector often correlate with increased spending on analytics and operational support to manage associated risks and data complexities.

What is the significance of the 'Computer Systems Design Services' (NAICS 541512) classification for this contract?

The classification under NAICS code 541512, 'Computer Systems Design Services,' is significant as it defines the primary nature of the work performed. This category encompasses a broad range of services related to planning, designing, and developing computer systems. For this contract, it implies that Deloitte is responsible for more than just basic IT support; they are likely involved in designing, integrating, and potentially modifying complex systems used for mortgage-backed securities operations and analytics. This could include database design, software integration, network architecture planning, and consulting on system improvements. This classification suggests a high level of technical expertise and a focus on creating or enhancing the technological infrastructure that underpins the government's MBS-related functions.

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

Solicitation ID: ID11170009

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte Touche Tohmatsu Limited

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: $170,502,987

Exercised Options: $164,565,450

Current Obligation: $156,901,887

Subaward Activity

Number of Subawards: 54

Total Subaward Amount: $34,172,992

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS00Q09BGD0018

IDV Type: GWAC

Timeline