Treasury's $11.98M IT Support Contract with Accenture Faces Scrutiny Over Long Duration and Limited Competition

Contract Overview

Contract Amount: $11,981,676 ($12.0M)

Contractor: Accenture LLP

Awarding Agency: Department of the Treasury

Start Date: 2006-05-24

End Date: 2017-09-29

Contract Duration: 4,146 days

Daily Burn Rate: $2.9K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 18

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: TOTAL INFORMATION PROCESSING SUPPORT SER

Place of Performance

Location: LANHAM, PRINCE GEORGES County, MARYLAND, 20706

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $12.0 million to ACCENTURE LLP for work described as: TOTAL INFORMATION PROCESSING SUPPORT SER Key points: 1. The contract awarded to Accenture LLP for IT support services represents a significant investment of $11.98 million. 2. Competition was limited, raising questions about price discovery and potential value for taxpayers. 3. The long duration of the contract (over 11 years) could indicate a lack of flexibility or evolving needs. 4. The sector is Information Technology, specifically Computer Systems Design Services, a critical area for government operations.

Value Assessment

Rating: questionable

The contract's Cost Plus Fixed Fee (CPFF) structure, combined with a long duration and limited competition, makes a definitive value assessment difficult without further data on performance and actual costs incurred.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

Awarded as a competitive delivery order, the limited nature suggests it may have been part of a larger contract vehicle or specific set-aside. The impact on price discovery is likely reduced compared to full and open competition.

Taxpayer Impact: The long-term nature and CPFF structure warrant scrutiny to ensure taxpayer funds are used efficiently and effectively for the services rendered.

Public Impact

Taxpayers may be paying above-market rates due to the extended contract term and potentially limited competitive pressure. The reliance on a single vendor for over a decade for critical IT support could pose a risk if the vendor's capabilities or pricing become unfavorable. Government efficiency in IT services could be impacted if this contract model is not benchmarked against more competitive or fixed-price arrangements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (11+ years)
Limited competition indicated
Cost Plus Fixed Fee pricing structure
Potential for vendor lock-in

Positive Signals

Awarded via a delivery order, suggesting it was part of an existing framework
Specific IT support services are essential for agency operations

Sector Analysis

This contract falls within the IT sector, specifically Computer Systems Design Services. Benchmarks for similar long-term IT support contracts vary widely based on scope, but extended sole-source or limited competition arrangements often invite higher costs.

Small Business Impact

The data does not indicate if small businesses were involved in the subcontracting or prime contracting. Further analysis would be needed to determine small business participation.

Oversight & Accountability

The long duration and CPFF structure suggest a need for robust oversight to ensure performance standards are met and costs remain reasonable. The 'MD' (Maryland) state code might indicate specific state-level oversight or reporting requirements.

Related Government Programs

Computer Systems Design Services
Department of the Treasury Contracting
Internal Revenue Service Programs

Risk Flags

Extended contract duration
Potential for limited competition
Cost Plus Fixed Fee pricing model
Lack of transparency on performance metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $12.0 million to ACCENTURE LLP. TOTAL INFORMATION PROCESSING SUPPORT SER

Who is the contractor on this award?

The obligated recipient is ACCENTURE LLP.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $12.0 million.

What is the period of performance?

Start: 2006-05-24. End: 2017-09-29.

What was the justification for awarding this contract as a competitive delivery order with limited competition, and what was the competitive landscape?

The justification for a competitive delivery order with limited competition would typically stem from the specific requirements of the task order, potentially fitting within an existing contract vehicle or requiring specialized expertise. Understanding the competitive landscape requires examining the number of bids received and the rationale for excluding other potential bidders. Without this information, it's difficult to ascertain if the government secured the best possible value.

How does the Cost Plus Fixed Fee (CPFF) structure compare to other pricing models for similar IT support services over such an extended period?

CPFF contracts can incentivize contractors to incur costs, with the government paying those costs plus a fixed fee. For long-term IT support, this can be less advantageous for the government compared to fixed-price contracts if costs escalate unexpectedly or if efficiencies are not realized. Benchmarking against fixed-price or performance-based contracts would reveal if this structure led to higher overall spending for the Treasury.

What performance metrics and outcomes were tracked throughout the 11-year duration of this contract to ensure effectiveness and value for money?

Effective oversight of a long-term CPFF contract necessitates rigorous tracking of performance metrics and defined outcomes. Without documented evidence of key performance indicators (KPIs) being met, service level agreements (SLAs) adhered to, and regular performance reviews, it's challenging to confirm the contract's effectiveness and whether it delivered consistent value for the $11.98 million spent.

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: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 18

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Accenture Public Limited Company (UEI: 985015354)

Address: 11951 FREEDOM DR, RESTON, VA, 20190

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $12,610,841

Exercised Options: $12,610,841

Current Obligation: $11,981,676

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: TIRNO06D00006

IDV Type: IDC

Timeline