UNISYS CORPORATION's $73.7M IT Operations Contract with DHS Faces Scrutiny Over Value and Competition

Contract Overview

Contract Amount: $73,688,795 ($73.7M)

Contractor: Unisys Corporation

Awarding Agency: Department of Homeland Security

Start Date: 2011-09-29

End Date: 2013-03-28

Contract Duration: 546 days

Daily Burn Rate: $135.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: IT OPERATIONS AND MAINTENANCE

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $73.7 million to UNISYS CORPORATION for work described as: IT OPERATIONS AND MAINTENANCE Key points: 1. The contract's value proposition requires deeper analysis against industry benchmarks for IT operations and maintenance. 2. Competition dynamics for this contract appear robust, potentially driving better pricing, but performance outcomes need monitoring. 3. Key risk indicators include the cost-plus-fixed-fee pricing structure, which can incentivize higher spending. 4. Performance context is limited, necessitating a review of service delivery metrics and user satisfaction. 5. This contract falls within the IT services sector, specifically focusing on computer facilities management. 6. The contract's duration and delivery order nature suggest a need for ongoing performance evaluation.

Value Assessment

Rating: fair

Benchmarking the $73.7 million total value against similar IT operations and maintenance contracts is crucial. The cost-plus-fixed-fee (CPFF) structure, while offering flexibility, can lead to cost overruns if not managed tightly. Without specific performance metrics, it's difficult to definitively assess value for money. However, the contract's duration of 546 days (approx. 1.5 years) for a significant IT services scope warrants careful review of cost efficiency over its lifecycle.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders likely had the opportunity to submit proposals. This level of competition is generally positive for price discovery and ensuring a fair market price. The specific number of bidders and the evaluation criteria would provide further insight into the intensity of the competition and its impact on the final negotiated price.

Taxpayer Impact: Full and open competition suggests that taxpayers benefited from a potentially more competitive pricing environment, reducing the risk of overpayment compared to sole-source or limited competition awards.

Public Impact

This contract directly supports U.S. Customs and Border Protection's critical IT infrastructure, ensuring the continuity of essential border security operations. The services provided are vital for maintaining the operational readiness of IT systems used by CBP personnel. Geographic impact is primarily within the operational areas served by U.S. Customs and Border Protection, likely across various ports of entry and administrative facilities. Workforce implications include the employment of IT professionals skilled in facilities management and system maintenance, both directly by the contractor and potentially through subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can lead to higher overall costs if not rigorously managed.
Lack of detailed performance metrics makes it challenging to assess the true value delivered.
The contract's duration and scope require continuous monitoring to ensure ongoing efficiency.

Positive Signals

Awarded through full and open competition, suggesting competitive pricing.
Supports a critical national security agency (DHS/CBP).
UNISYS CORPORATION has a significant presence in government IT contracting.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on computer facilities management. The market for IT operations and maintenance services for federal agencies is substantial, with significant spending allocated annually. Comparable contracts often involve managing complex data centers, network infrastructure, and end-user support. Benchmarks for IT O&M typically consider factors like system uptime, response times, and cost per managed asset.

Small Business Impact

There is no indication that this contract involved small business set-asides, nor is there information suggesting specific subcontracting plans for small businesses. Further analysis would be needed to determine if small businesses were indirectly involved or if opportunities were missed. The absence of set-asides means the primary focus was on large business competition.

Oversight & Accountability

Oversight for this contract would typically reside with the U.S. Customs and Border Protection contracting officers and program managers. The Department of Homeland Security's Office of Inspector General (OIG) may also conduct audits or investigations into contract performance and spending, particularly given the CPFF structure. Transparency is enhanced through contract award databases, but detailed performance reports are often internal.

Related Government Programs

IT Operations and Maintenance Services
Computer Facilities Management
Department of Homeland Security IT Contracts
Customs and Border Protection Systems Support
Large-Scale IT Service Delivery

Risk Flags

Cost-Plus-Fixed-Fee pricing structure requires diligent oversight to prevent cost escalation.
Performance metrics are not detailed, making value assessment challenging.
Contract duration necessitates ongoing monitoring for efficiency and effectiveness.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $73.7 million to UNISYS CORPORATION. IT OPERATIONS AND MAINTENANCE

Who is the contractor on this award?

The obligated recipient is UNISYS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $73.7 million.

What is the period of performance?

Start: 2011-09-29. End: 2013-03-28.

What is UNISYS CORPORATION's track record with similar IT operations and maintenance contracts within the federal government?

UNISYS CORPORATION has a long history of performing IT operations and maintenance services for various federal agencies, including significant contracts with the Department of Defense and other civilian departments. Their experience spans managing complex IT infrastructure, data centers, and end-user support. While this provides a basis for confidence, each contract's success depends on specific scope, management, and performance metrics. A review of past performance evaluations and any past performance issues on similar contracts would offer a more nuanced understanding of their capabilities and reliability in this specific domain.

How does the pricing structure (Cost Plus Fixed Fee) compare to industry standards for similar IT services, and what are the associated risks?

The Cost Plus Fixed Fee (CPFF) pricing structure is common for complex IT services where the scope may evolve or is difficult to define precisely upfront. It allows for flexibility but carries inherent risks. The 'cost-plus' element means the government pays the contractor's allowable costs, plus a fixed fee representing profit. This can incentivize the contractor to incur more costs, potentially leading to higher overall spending than a fixed-price contract. Effective oversight, stringent cost controls, and clear definition of allowable costs are critical to mitigate these risks and ensure value for money. Benchmarking against CPFF contracts with similar scopes and durations is essential for assessing reasonableness.

What specific performance metrics were used to evaluate the success of this contract, and how did the contractor perform against them?

Detailed performance metrics for this specific contract are not publicly available in the provided data. Typically, for IT operations and maintenance, metrics would include system uptime percentages, response times for service requests, incident resolution rates, and adherence to security protocols. The success of the contract hinges on the contractor meeting or exceeding these predefined Key Performance Indicators (KPIs). Without access to performance reports or user feedback, a definitive assessment of UNISYS CORPORATION's performance against expectations is not possible. Future analysis should seek these performance data points.

What is the historical spending trend for IT operations and maintenance services by U.S. Customs and Border Protection, and how does this contract fit within that trend?

Historical spending data for CBP's IT operations and maintenance services would provide context for this $73.7 million contract. Agencies like CBP often have substantial and ongoing needs for IT support due to the critical nature of their mission. Understanding whether this contract represents an increase, decrease, or stable level of spending compared to previous years or similar contracts is important. It helps determine if the current investment is aligned with strategic priorities and budget realities. Analyzing trends can reveal patterns of increased reliance on external IT support or shifts in technology adoption.

Were there any significant challenges or issues reported during the performance of this contract, such as cost overruns, schedule delays, or quality deficiencies?

The provided data does not include specific details on challenges or issues encountered during the performance of this contract. However, given the CPFF structure and the duration, potential areas for challenges could include scope creep, unforeseen technical difficulties, or difficulties in accurately estimating costs. Any reported cost overruns, schedule delays, or quality deficiencies would typically be documented in contract performance reports or potentially flagged by oversight bodies like the DHS OIG. A thorough review would require accessing these internal or semi-public records.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Facilities Management 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: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 11720 PLAZA AMERICA DR, RESTON, VA, 20190

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $116,000,255

Exercised Options: $73,688,795

Current Obligation: $73,688,795

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HSHQDC06D00023

IDV Type: IDC

Timeline