DHS awards $178M IT contract to Unisys Corporation for computer systems design services

Contract Overview

Contract Amount: $178,109,545 ($178.1M)

Contractor: Unisys Corporation

Awarding Agency: Department of Homeland Security

Start Date: 2009-07-01

End Date: 2010-12-31

Contract Duration: 548 days

Daily Burn Rate: $325.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: BRIDGE 2

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22201

State: Virginia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $178.1 million to UNISYS CORPORATION for work described as: BRIDGE 2 Key points: 1. Contract awarded on a sole-source basis, raising questions about potential cost efficiencies. 2. The contract's cost-plus-fixed-fee structure may incentivize increased spending. 3. Limited competition suggests potential for higher prices than in a more open market. 4. The duration of the contract (548 days) indicates a significant, ongoing need for services. 5. The award was made by the Department of Homeland Security, a large federal agency. 6. The specific service category is Computer Systems Design Services, a common IT requirement.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature and the lack of publicly available comparable contract data. The cost-plus-fixed-fee pricing model, while common for complex IT projects, can lead to costs exceeding initial estimates if not carefully managed. Without competitive bids, it's difficult to ascertain if the fixed fee represents a fair market rate for the services provided. Further analysis would require access to detailed cost breakdowns and performance metrics.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Unisys Corporation, was considered. This approach bypasses the standard competitive bidding process, which typically involves multiple vendors submitting proposals. While sole-source awards can be justified in specific circumstances (e.g., unique capabilities, urgent needs), they limit price discovery and can reduce the incentive for vendors to offer their most competitive pricing.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as the government does not benefit from the price reductions typically achieved through competitive bidding.

Public Impact

The primary beneficiary is the Department of Homeland Security, specifically the Transportation Security Administration, which receives essential IT support. The services delivered are crucial for the design and maintenance of computer systems, supporting the agency's operational capabilities. The geographic impact is primarily within the United States, supporting federal IT infrastructure. The contract supports a workforce skilled in computer systems design and related IT services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Cost-plus-fixed-fee structure may not always align incentives for cost control.
Lack of transparency in sole-source justifications can obscure true necessity.
Potential for vendor lock-in given the specific nature of IT systems design.

Positive Signals

Award to an established contractor (Unisys) may indicate reliability and existing expertise.
Contract supports critical infrastructure for a major federal agency.
Fixed fee component provides some level of cost predictability.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on computer systems design services. This is a broad and essential category for government operations, encompassing the planning, development, and implementation of IT infrastructure. The market for such services is highly competitive, with numerous large and small firms offering specialized expertise. Federal spending in this area is substantial, reflecting the increasing reliance on technology across all government functions. Comparable spending benchmarks would typically involve analyzing other large IT service contracts awarded to system integrators.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the contractor, Unisys Corporation, is a large business. This suggests that small businesses are unlikely to be direct beneficiaries of this specific award. However, it is possible that Unisys may engage small businesses as subcontractors, though this information is not detailed in the provided data. The absence of a set-aside means opportunities for small business participation are not explicitly mandated.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Homeland Security's internal procurement and program management offices. The Transportation Security Administration would also have oversight responsibilities. Given the contract type and duration, regular performance reviews and financial audits would be expected. The Inspector General for DHS would have jurisdiction to investigate any potential fraud, waste, or abuse related to this award. Transparency is limited due to the sole-source nature, but contract performance reports and financial data should be available through appropriate channels.

Related Government Programs

IT Services
Computer Systems Design
Department of Homeland Security Contracts
Transportation Security Administration IT Support
Sole Source IT Awards

Risk Flags

Sole Source Justification
Cost-Plus Pricing Risk
Limited Competition Impact
Potential for Cost Overruns

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $178.1 million to UNISYS CORPORATION. BRIDGE 2

Who is the contractor on this award?

The obligated recipient is UNISYS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Transportation Security Administration).

What is the total obligated amount?

The obligated amount is $178.1 million.

What is the period of performance?

Start: 2009-07-01. End: 2010-12-31.

What is the track record of Unisys Corporation in performing similar IT services for the federal government?

Unisys Corporation has a long history of contracting with the U.S. federal government, providing a wide range of IT services including systems integration, cloud computing, cybersecurity, and legacy system modernization. They have held numerous large contracts across various agencies, including the Department of Defense, the Social Security Administration, and the Department of Homeland Security itself. Their experience spans complex IT infrastructure projects and mission-critical systems. While generally considered an experienced provider, like any large contractor, they have faced scrutiny and performance reviews on specific contracts. A detailed review of their past performance on contracts of similar size and scope for DHS or TSA would be necessary to fully assess their track record for this specific award.

How does the pricing structure (Cost Plus Fixed Fee) compare to other IT service contracts of similar scope?

The Cost Plus Fixed Fee (CPFF) pricing model is common for IT service contracts, particularly those involving research, development, or complex system design where the final scope and costs are not fully predictable at the outset. In a CPFF contract, the contractor is reimbursed for all allowable costs plus a fixed fee representing their profit. This structure aims to provide some cost certainty through the fixed fee while allowing flexibility for unforeseen technical challenges. However, it can incentivize the contractor to incur more costs, as their profit is fixed regardless of the total cost. Compared to fixed-price contracts, CPFF can be more expensive for the government if costs escalate significantly. Benchmarking requires comparing the fixed fee percentage and the total cost against similar CPFF contracts for comparable IT services, considering the contract's complexity and duration.

What are the specific risks associated with a sole-source IT contract of this magnitude?

The primary risk of a sole-source IT contract of this magnitude is the lack of competitive pressure, which can lead to inflated pricing and reduced innovation. Without competing bids, the government may not secure the best possible value for its investment. There's also a risk of vendor lock-in, where the government becomes heavily reliant on a single provider, making future transitions difficult and potentially costly. Furthermore, the justification for a sole-source award needs to be robust; if not properly documented or if alternatives were overlooked, it raises concerns about fairness and efficiency. Finally, oversight becomes even more critical to ensure the contractor is performing effectively and efficiently, as the usual market checks and balances are absent.

What performance metrics or deliverables were likely established for this contract to ensure accountability?

For a contract of this nature, performance metrics and deliverables would typically be detailed in the contract's Statement of Work (SOW) or Performance Work Statement (PWS). These would likely include specific technical performance standards (e.g., system uptime, response times, data accuracy), project milestones (e.g., completion of design phases, system deployment dates), and quality assurance requirements. Deliverables might include design documents, software code, system documentation, training materials, and regular progress reports. Accountability would be enforced through contract clauses that allow for remedies if performance standards are not met, such as service level credits, contract modifications, or even termination. Regular reviews by the Contracting Officer's Representative (COR) would assess adherence to these metrics and deliverables.

How does this contract's value compare to historical IT spending by the TSA or DHS for similar services?

To compare this contract's value ($178 million) to historical spending, one would need access to historical contract databases and budget documents for the TSA and DHS. Analyzing past awards for 'Computer Systems Design Services' (NAICS 541512) or similar IT categories over the period of performance (2009-2010) and subsequent years would be necessary. Key comparison points would include the number of bidders, contract type (e.g., fixed-price vs. cost-reimbursable), duration, and the specific services rendered. Given this was a sole-source award in 2009, its value might be higher than if it had been competitively procured. Understanding the specific technological needs and market conditions during that period is crucial for a meaningful comparison.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 11720 PLAZA AMERICA DR, TOWER III, RESTON, VA, 11

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

Financial Breakdown

Contract Ceiling: $178,109,545

Exercised Options: $178,109,545

Current Obligation: $178,109,545

Contract Characteristics

Cost or Pricing Data: YES

Timeline