IBM Awarded $376M USCIS Transformation Program Contract for Custom Computer Programming Services

Contract Overview

Contract Amount: $376,281,939 ($376.3M)

Contractor: International Business Machines Corporation

Awarding Agency: Department of Homeland Security

Start Date: 2008-11-03

End Date: 2013-06-27

Contract Duration: 1,697 days

Daily Burn Rate: $221.7K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: USCIS TRANSFORMATION PROGRAM SOLUTIONS ARCHITECT (SA)

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20001

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $376.3 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: USCIS TRANSFORMATION PROGRAM SOLUTIONS ARCHITECT (SA) Key points: 1. Significant contract value of $376.3 million awarded to a single large vendor. 2. Competition method was 'Competitive Delivery Order', suggesting some level of bidding. 3. Risk of vendor lock-in and potential cost overruns due to Cost Plus Award Fee structure. 4. Spending falls within the IT sector, specifically custom computer programming.

Value Assessment

Rating: fair

The contract's Cost Plus Award Fee (CPAF) structure can lead to higher costs if not managed tightly. Benchmarking against similar large-scale IT transformation projects is difficult without more granular cost data.

Cost Per Unit: N/A

Competition Analysis

Competition Level: unknown

Awarded as a 'Competitive Delivery Order', indicating multiple bids were likely considered. However, the CPAF structure may incentivize cost increases to achieve award fees, potentially impacting price discovery.

Taxpayer Impact: Taxpayer funds are being used for a large-scale IT transformation program. The CPAF structure necessitates careful oversight to ensure cost efficiency and value for money.

Public Impact

Impacts USCIS's ability to modernize its systems and improve citizen services. Large contract award to a major IT vendor, potentially affecting smaller competitors. Potential for improved efficiency and effectiveness in immigration processing if the program is successful.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee structure can lead to uncontrolled spending.
Lack of specific performance metrics makes assessing value difficult.
Long contract duration increases risk of scope creep and obsolescence.

Positive Signals

Competitive award process suggests potential for good pricing.
Focus on IT transformation indicates investment in modernization.
Award fee mechanism incentivizes meeting performance targets.

Sector Analysis

This contract falls under the Information Technology sector, specifically custom computer programming. Spending benchmarks for large-scale government IT transformation programs vary widely based on scope and complexity.

Small Business Impact

The contract was awarded to IBM, a large corporation, and there is no indication of small business participation. This suggests limited opportunities for small businesses in this specific award.

Oversight & Accountability

The Cost Plus Award Fee structure requires robust oversight to ensure contractor performance and cost control. The number of delivery orders (3) suggests ongoing management and tasking.

Related Government Programs

Custom Computer Programming Services
Department of Homeland Security Contracting
Office of Procurement Operations Programs

Risk Flags

Cost Plus Award Fee (CPAF) structure can lead to higher costs.
Lack of transparency on specific performance metrics for award fees.
Long contract duration increases risk of cost overruns and scope creep.
No clear indication of small business subcontracting goals.
Potential for vendor lock-in with a single large provider.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $376.3 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. USCIS TRANSFORMATION PROGRAM SOLUTIONS ARCHITECT (SA)

Who is the contractor on this award?

The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Office of Procurement Operations).

What is the total obligated amount?

The obligated amount is $376.3 million.

What is the period of performance?

Start: 2008-11-03. End: 2013-06-27.

What specific performance metrics were used to determine award fees, and how effectively did the contractor meet them?

The effectiveness of award fees hinges on clearly defined, measurable, and achievable performance metrics tied to program objectives. Without access to the contract's specific award fee criteria and performance evaluations, it's impossible to definitively assess how effectively IBM met them. This information is crucial for understanding if the CPAF structure truly drove value or simply increased costs.

How did the competitive delivery order process ensure the best possible price for the government, given the CPAF structure?

A competitive delivery order process is a positive step towards price discovery. However, the Cost Plus Award Fee (CPAF) structure inherently allows for costs to exceed initial estimates, with the government paying actual costs plus a fee. The competitiveness of the bids likely focused on the proposed fee structure and initial cost estimates, but ongoing oversight is critical to manage costs throughout the contract's life.

What is the long-term impact of this contract on USCIS's operational efficiency and citizen service delivery?

The intended impact is significant modernization of USCIS systems, aiming for improved efficiency and service delivery. The success of this $376 million investment depends on effective program management, successful technology implementation, and user adoption. Without post-award performance data and system outcome metrics, the actual long-term impact remains to be seen.

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 › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 6710 ROCKLEDGE DR, BETHESDA, MD, 20817

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $432,608,701

Exercised Options: $427,465,634

Current Obligation: $376,281,939

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HSHQDC06D00019

IDV Type: IDC

Timeline