Treasury's $27.6M SNI System Purchase by FCN, Inc. Awarded Under Full and Open Competition

Contract Overview

Contract Amount: $27,640,000 ($27.6M)

Contractor: FCN, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2012-08-27

End Date: 2017-10-30

Contract Duration: 1,890 days

Daily Burn Rate: $14.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 52

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: PURCHASE OF AN SNI SYSTEM, INCLUDING OPTIONS

Place of Performance

Location: FORT WORTH, TARRANT County, TEXAS, 76131

State: Texas Government Spending

Plain-Language Summary

Department of the Treasury obligated $27.6 million to FCN, INC. for work described as: PURCHASE OF AN SNI SYSTEM, INCLUDING OPTIONS Key points: 1. The contract's value of $27.6 million over its period of performance suggests a significant investment in IT infrastructure. 2. Awarded under 'Full and Open Competition After Exclusion of Sources,' this indicates a competitive process with specific justifications for excluding other potential bidders. 3. The 'Firm Fixed Price' contract type generally offers cost certainty for the government, shifting risk to the contractor. 4. The duration of 1890 days (approximately 5 years) points to a long-term need for the SNI system. 5. The North American Industry Classification System (NAICS) code 541519 suggests services related to computer systems integration and IT consulting. 6. The contract was awarded as a Delivery Order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar framework.

Value Assessment

Rating: fair

Benchmarking the value of this specific SNI system purchase is challenging without detailed technical specifications and market comparisons for similar systems. The total award amount of $27.6 million over nearly five years averages to approximately $5.5 million annually. This figure needs to be assessed against the complexity and criticality of the system being procured. The 'Firm Fixed Price' nature of the contract suggests that the contractor bears the risk of cost overruns, which can be a positive indicator for value if the price is competitive.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This designation implies that while the competition was intended to be open, specific sources were excluded, likely due to pre-existing contract vehicles, specialized capabilities, or other defined justifications. The number of bidders is not specified, but the exclusion of sources suggests a potentially narrower competitive field than a truly unrestricted full and open competition.

Taxpayer Impact: While the exclusion of sources might limit the breadth of competition, the remaining open competition aims to secure the best value. Taxpayers benefit from a competitive process that, even with exclusions, seeks to ensure fair pricing and suitable technical solutions.

Public Impact

The Bureau of Engraving and Printing (BEP) is the primary beneficiary, receiving the SNI system to support its operational needs. The system likely enhances or replaces existing capabilities related to information technology services, potentially improving efficiency or security. The contract's performance is located in Texas (ST: TX, SN: TEXAS), indicating a geographic focus for service delivery or system implementation. The workforce implications are tied to the IT services sector, potentially involving specialized technical personnel for implementation, maintenance, and support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'Exclusion of Sources' in the competition type warrants further investigation to understand the rationale and potential impact on price competitiveness.
Lack of specific details on the SNI system's function makes it difficult to assess its true value and necessity.
The duration of the contract (nearly 5 years) could lead to technology obsolescence if not managed proactively.

Positive Signals

The use of 'Full and Open Competition' (even with exclusions) suggests an effort to leverage market forces for a better outcome.
The 'Firm Fixed Price' contract type provides cost predictability for the government.
The contract is awarded to FCN, Inc., whose track record and past performance would need to be reviewed for a complete assessment.

Sector Analysis

The procurement falls within the broader IT services sector, specifically 'Other Computer Related Services' (NAICS 541519). This sector is characterized by rapid technological advancements and a wide range of service providers, from large integrators to niche specialists. The market size for IT services supporting government operations is substantial, with agencies continually investing in modernizing their infrastructure and systems. This contract represents a specific investment in a specialized system, likely for critical functions within the Bureau of Engraving and Printing.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (SS: false, SB: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. The prime contractor, FCN, Inc., may still engage small businesses as subcontractors, but this is not mandated by the contract's award type. Analysis of FCN, Inc.'s subcontracting plan, if one exists, would be necessary to determine the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting agency, the Department of the Treasury, and specifically the Bureau of Engraving and Printing. Mechanisms would include contract performance reviews, milestone tracking, and financial audits. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected or identified during the contract's lifecycle.

Related Government Programs

IT Infrastructure Modernization Programs
Information Security Systems Procurement
Government IT Services Contracts
Bureau of Engraving and Printing Operations Support

Risk Flags

Competition Exclusions
Lack of System Specificity
Long Contract Duration Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $27.6 million to FCN, INC.. PURCHASE OF AN SNI SYSTEM, INCLUDING OPTIONS

Who is the contractor on this award?

The obligated recipient is FCN, INC..

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Bureau of Engraving and Printing).

What is the total obligated amount?

The obligated amount is $27.6 million.

What is the period of performance?

Start: 2012-08-27. End: 2017-10-30.

What is the specific function and criticality of the SNI system being purchased?

The provided data identifies the purchase as 'PURCHASE OF AN SNI SYSTEM, INCLUDING OPTIONS' under NAICS code 541519 ('Other Computer Related Services'). However, the specific function and criticality of the 'SNI' system are not detailed. SNI could potentially stand for various technical terms, such as 'Secure Network Interface,' 'System Network Integration,' or something entirely different depending on the context within the Bureau of Engraving and Printing (BEP). Without further information, it's impossible to ascertain its precise role, whether it's for data processing, network security, operational control, or another function. Its criticality would depend on whether it supports core mission functions of the BEP, such as currency production or related administrative processes. Understanding this would be crucial for assessing the value and risk associated with the $27.6 million investment.

How does the $27.6 million total contract value compare to similar SNI system procurements by other federal agencies?

Direct comparison of the $27.6 million total contract value for this SNI system is difficult without knowing the exact specifications and capabilities of the system procured by the Bureau of Engraving and Printing (BEP). Federal IT procurements vary widely in scope, complexity, and technology. A system for network security might differ significantly in cost from one for data integration or operational management. To benchmark effectively, one would need to identify comparable systems procured by agencies with similar operational needs or IT environments. Furthermore, the contract duration of approximately five years means the annual expenditure is around $5.5 million, which provides a different perspective than the total award. A comprehensive analysis would involve searching contract databases for similar NAICS codes and keywords, filtering by system type and agency size, and then comparing award values and contract lengths.

What were the specific reasons for excluding other sources in the 'Full and Open Competition After Exclusion of Sources' award?

The designation 'Full and Open Competition After Exclusion of Sources' indicates that while the competition was intended to be open, certain potential sources were deliberately excluded. Federal Acquisition Regulation (FAR) Part 6 outlines the circumstances under which sources may be excluded, typically requiring justification based on factors such as the need for a specific brand-name item, unique capabilities of a particular contractor, urgency, or the existence of a preceding contract that makes it advantageous to continue with the same contractor. For this specific contract awarded to FCN, Inc., the justification for excluding other sources would need to be documented in the contract file. Common reasons might include leveraging existing infrastructure, specialized expertise held by FCN, Inc., or specific technical requirements that only a limited number of vendors could meet. Understanding these documented justifications is key to assessing whether the exclusion unduly limited competition and potentially impacted the final price.

What is FCN, Inc.'s track record with similar IT system procurements for federal agencies?

Assessing FCN, Inc.'s track record with similar IT system procurements requires examining their past performance on federal contracts. Publicly available data, such as contract award histories and performance evaluations (if available through systems like the Contractor Performance Assessment Reporting System - CPARS), would provide insights. Key areas to investigate include their success in delivering complex IT systems on time and within budget, their technical expertise in areas relevant to SNI systems, and any history of contract disputes or performance issues. Given this contract is for $27.6 million over nearly five years, FCN, Inc.'s experience with large-scale, long-duration IT projects is a critical factor. A positive track record suggests a lower risk of performance issues, while a history of problems could indicate potential challenges for this specific procurement.

What are the potential risks associated with a 'Firm Fixed Price' contract for an IT system over a 5-year period?

A 'Firm Fixed Price' (FFP) contract, while offering cost certainty to the government, carries inherent risks, especially for long-duration IT projects. For the contractor (FCN, Inc. in this case), the primary risk is underestimating the costs associated with development, implementation, and maintenance over the 1890-day period. Unforeseen technical challenges, scope creep (if not managed tightly), or significant changes in market prices for components or labor could erode profit margins or lead to losses. For the government, the risk lies in the potential for the contractor to cut corners on quality or performance to maintain profitability if costs escalate unexpectedly. Additionally, if the initial price was set too high due to contractor optimism or inadequate government cost estimation, the government might overpay. The long duration increases the likelihood of technological obsolescence or the need for significant modifications, which can be more complex and costly to manage under an FFP structure compared to other contract types.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: SPECIAL INDUSTRY MACHINERY

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 52

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 12315 WILKINS AVE, ROCKVILLE, MD, 20852

Business Categories: Category Business, Small Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $70,120,000

Exercised Options: $27,640,000

Current Obligation: $27,640,000

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: NNG07DA26B

IDV Type: GWAC

Timeline