SSA Awards $99.3M BMC Software Maintenance Contract to BMC Software, Inc. for 5 Years
Contract Overview
Contract Amount: $99,281,000 ($99.3M)
Contractor: BMC Software, Inc.
Awarding Agency: Social Security Administration
Start Date: 2014-12-01
End Date: 2019-11-30
Contract Duration: 1,825 days
Daily Burn Rate: $54.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: ESTABLISH BASE + 4 OY BMC SOFTWARE MAINTENANCE CONTRACT
Place of Performance
Location: HOUSTON, HARRIS County, TEXAS, 77042
State: Texas Government Spending
Plain-Language Summary
Social Security Administration obligated $99.3 million to BMC SOFTWARE, INC. for work described as: ESTABLISH BASE + 4 OY BMC SOFTWARE MAINTENANCE CONTRACT Key points: 1. The contract is for BMC Software maintenance, a critical component for the Social Security Administration's operations. 2. BMC Software, Inc. is the sole provider of this specific maintenance, raising questions about vendor lock-in. 3. The contract value of $99.3 million over five years represents a significant investment in software support. 4. The sector is IT, specifically software maintenance and support, a common area for government spending.
Value Assessment
Rating: fair
The contract value of $99.3 million over five years, averaging approximately $19.86 million annually, needs to be benchmarked against similar software maintenance contracts for BMC products. Without specific per-unit cost data, a direct comparison is difficult, but the overall value suggests a substantial commitment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Although the contract was awarded under full and open competition, the nature of software maintenance often leads to a single vendor being the only viable option for continued support and updates. This can limit price discovery in subsequent renewals.
Taxpayer Impact: Taxpayers are funding essential software maintenance for the Social Security Administration. The effectiveness of the competition method in securing the best value for this critical service warrants ongoing scrutiny.
Public Impact
Ensures continued operation of critical IT systems for the Social Security Administration. Supports the agency's ability to process benefits and manage constituent data. Potential for cost savings if competition was robust and pricing is competitive. Risk of increased costs if vendor lock-in limits future negotiation leverage.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential vendor lock-in for specialized software maintenance.
- Reliance on a single vendor for critical IT infrastructure.
- Need to ensure ongoing competitive pricing for renewals.
Positive Signals
- Awarded under full and open competition.
- Supports essential government functions.
- Firm fixed price contract provides cost certainty.
Sector Analysis
This contract falls within the Information Technology sector, specifically focusing on software maintenance and support. Government spending on IT maintenance is substantial, with benchmarks varying widely based on the software's criticality, vendor, and contract type. This $19.86 million annual spend is significant for a single software maintenance agreement.
Small Business Impact
The data indicates that this contract was not set aside for small businesses and was awarded to BMC Software, Inc., a large corporation. There is no indication of small business participation in this specific award.
Oversight & Accountability
The Social Security Administration is responsible for overseeing this contract. Robust oversight is crucial to ensure the vendor meets performance requirements and that the pricing remains competitive throughout the contract period, especially during potential renewal phases.
Related Government Programs
- Computer and Software Stores
- Social Security Administration Contracting
- Social Security Administration Programs
Risk Flags
- Potential for vendor lock-in
- Reliance on a single vendor for critical software
- Need for ongoing price competitiveness assessment
- Complexity of proprietary software maintenance
Tags
computer-and-software-stores, social-security-administration, tx, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Social Security Administration awarded $99.3 million to BMC SOFTWARE, INC.. ESTABLISH BASE + 4 OY BMC SOFTWARE MAINTENANCE CONTRACT
Who is the contractor on this award?
The obligated recipient is BMC SOFTWARE, INC..
Which agency awarded this contract?
Awarding agency: Social Security Administration (Social Security Administration).
What is the total obligated amount?
The obligated amount is $99.3 million.
What is the period of performance?
Start: 2014-12-01. End: 2019-11-30.
What was the competitive landscape during the initial full and open competition for this BMC software maintenance, and did it result in demonstrably lower pricing compared to sole-source alternatives?
While awarded under full and open competition, the specific nature of proprietary software maintenance often means only the original vendor can provide it. The initial competition's success in driving down price would depend on the number of qualified bidders and the agency's negotiation strategy. Without detailed bid data, it's hard to definitively say if it was demonstrably lower than a sole-source scenario, but competition is generally preferred for price discovery.
What is the risk of vendor lock-in with BMC Software, Inc., and what strategies are in place to mitigate potential price increases in future contract renewals?
The primary risk is vendor lock-in, as BMC Software, Inc. likely holds the intellectual property and expertise for its own software maintenance. To mitigate price increases, the SSA should actively monitor market rates, explore potential alternative solutions or competitors for future needs, and build strong negotiation positions based on performance data and usage metrics.
How effectively does this $99.3 million contract ensure the continued operational effectiveness of the Social Security Administration's critical IT systems, and what are the key performance indicators
This contract is essential for maintaining the operational effectiveness of the SSA's IT systems that rely on BMC software. Key performance indicators likely include system uptime, response times for maintenance requests, patch deployment success rates, and overall system stability. Effective tracking of these KPIs ensures the agency receives the expected value and service levels.
Industry Classification
NAICS: Retail Trade › Electronics and Appliance Stores › Computer and Software Stores
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: SSA-RFQ-15-0050
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: BMC Software Inc. (UEI: 079161545)
Address: 2103 CITYWEST BLVD, HOUSTON, TX, 77042
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $99,281,000
Exercised Options: $99,281,000
Current Obligation: $99,281,000
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Parent Contract
Parent Award PIID: GS35F0340W
IDV Type: FSS
Timeline
Start Date: 2014-12-01
Current End Date: 2019-11-30
Potential End Date: 2019-11-30 00:00:00
Last Modified: 2018-11-29
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