Treasury's $41.8M IT contract with Accenture faces scrutiny for non-competitive award and long duration
Contract Overview
Contract Amount: $41,848,953 ($41.8M)
Contractor: Accenture LLP
Awarding Agency: Department of the Treasury
Start Date: 2006-08-31
End Date: 2014-08-28
Contract Duration: 2,919 days
Daily Burn Rate: $14.3K/day
Competition Type: NON-COMPETITIVE DELIVERY ORDER
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: TOTAL INFORMATION PROCESSING SUPPORT SER
Place of Performance
Location: LANHAM, PRINCE GEORGE'S County, MARYLAND, 20706
State: Maryland Government Spending
Plain-Language Summary
Department of the Treasury obligated $41.8 million to ACCENTURE LLP for work described as: TOTAL INFORMATION PROCESSING SUPPORT SER Key points: 1. Significant spending on IT support services highlights reliance on external vendors. 2. The contract's non-competitive nature raises questions about price discovery and value. 3. Long contract duration (8 years) may indicate potential for cost overruns or evolving needs. 4. The IT sector is prone to rapid technological change, impacting long-term contract relevance.
Value Assessment
Rating: questionable
The contract's Cost Plus Fixed Fee structure, combined with a non-competitive award, makes a direct pricing assessment difficult. Benchmarking against similar 'Computer Systems Design Services' contracts is challenging without more detailed cost breakdowns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
Awarded as a non-competitive delivery order, this limits price discovery. The absence of competition likely resulted in a higher price than if multiple vendors had vied for the contract.
Taxpayer Impact: Taxpayers may have overpaid due to the lack of competitive bidding and the potential for less efficient cost management inherent in sole-source awards.
Public Impact
IRS relies on a single vendor for critical IT support, potentially impacting service continuity if issues arise. Long-term IT contracts can lock agencies into specific technologies, hindering adoption of more efficient or cost-effective solutions. Lack of transparency in sole-source awards can erode public trust in government spending.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Non-competitive award
- Long contract duration
- Cost Plus Fixed Fee structure
- Lack of transparency
Positive Signals
- Consistent IT support provided over 8 years
- Established vendor relationship
Sector Analysis
The IRS, a major government agency, requires extensive IT support for its complex operations. Spending benchmarks for IT services vary widely, but long-term, sole-source contracts for core functions often represent a higher risk profile.
Small Business Impact
The contract was awarded to Accenture LLP, a large business. There is no indication that small businesses were involved in the primary contract, missing an opportunity for small business participation.
Oversight & Accountability
The non-competitive nature of this award warrants closer oversight to ensure the government received fair value. Accountability for cost management within the Cost Plus Fixed Fee structure is crucial.
Related Government Programs
- Computer Systems Design Services
- Department of the Treasury Contracting
- Internal Revenue Service Programs
Risk Flags
- Lack of competition
- Potential for inflated costs
- Long contract duration
- Limited transparency
- Risk of vendor lock-in
Tags
computer-systems-design-services, department-of-the-treasury, md, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Treasury awarded $41.8 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 $41.8 million.
What is the period of performance?
Start: 2006-08-31. End: 2014-08-28.
What specific IT support services were provided under this contract, and how did they evolve over the 8-year period?
The contract covered 'Computer Systems Design Services.' Over its 8-year duration, these services likely encompassed a range of activities from system design and integration to ongoing maintenance and support for IRS IT infrastructure. The evolution would depend on the IRS's changing technological needs and strategic IT goals during that timeframe.
What justification was provided for awarding this contract on a sole-source basis, and were alternatives ever considered?
Sole-source justifications typically cite reasons such as unique capabilities, urgent needs, or follow-on work where only one vendor can meet requirements. For this contract, the justification would need to be reviewed to understand why competition was deemed impractical or impossible. Alternatives, if considered, would likely have been evaluated against the perceived unique suitability of Accenture's offering.
How does the total cost of this contract compare to industry benchmarks for similar IT support services, considering the duration and scope?
Direct comparison is difficult without detailed cost breakdowns and service level agreements. However, the Cost Plus Fixed Fee structure combined with a sole-source award for an 8-year duration suggests a potential for higher costs than a competitively bid, fixed-price contract. Benchmarking would require analyzing the specific services rendered against market rates for comparable IT support functions.
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: NON-COMPETITIVE DELIVERY ORDER
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
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, 11
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $42,358,915
Exercised Options: $42,358,915
Current Obligation: $41,848,953
Parent Contract
Parent Award PIID: TIRNO06D00006
IDV Type: IDC
Timeline
Start Date: 2006-08-31
Current End Date: 2014-08-28
Potential End Date: 2014-08-28 00:00:00
Last Modified: 2014-09-09
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