Leidos Management Systems Designers Inc. contract for computer systems design services awarded by the IRS for $19.1M

Contract Overview

Contract Amount: $19,139,601 ($19.1M)

Contractor: Leidos Management Systems Designers, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2006-05-29

End Date: 2013-04-26

Contract Duration: 2,524 days

Daily Burn Rate: $7.6K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 103

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: ADDING INCREMENTAL FUNDING (MSD)

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20002

State: District of Columbia Government Spending

Plain-Language Summary

Department of the Treasury obligated $19.1 million to LEIDOS MANAGEMENT SYSTEMS DESIGNERS, INC. for work described as: ADDING INCREMENTAL FUNDING (MSD) Key points: 1. The contract was awarded on a competitive basis, suggesting potential for good value. 2. The duration of the contract (2524 days) indicates a long-term need for these services. 3. The Cost Plus Fixed Fee (CPFF) pricing structure can incentivize cost control by the contractor. 4. The North American Industry Classification System (NAICS) code 541512 points to a standard IT service offering. 5. The contract was awarded to a single entity, Leidos Management Systems Designers, Inc. 6. The contract was a delivery order under a larger contract, implying a pre-existing framework. 7. The contract was awarded to a large business, with no indication of small business set-aside.

Value Assessment

Rating: good

Benchmarking the value of this specific delivery order is challenging without knowing the total contract value it falls under. However, the competitive award suggests that the pricing was likely vetted against market rates. The CPFF structure, while offering flexibility, requires careful oversight to ensure costs remain reasonable and the fixed fee aligns with the scope of work. Compared to similar IT services contracts, the overall value appears within a typical range for complex system design and integration projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded as a competitive delivery order, indicating that multiple vendors likely had the opportunity to bid. The presence of 103 offers suggests a robust competition, which is generally favorable for price discovery and ensuring the government receives competitive pricing. The competitive nature of the award process is a positive indicator for value for money.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

The primary beneficiary of this contract is the Internal Revenue Service (IRS), which receives essential computer systems design services. These services are crucial for maintaining and potentially upgrading the IRS's IT infrastructure, which supports tax administration. The geographic impact is primarily within the District of Columbia, where the contract was awarded. The contract likely supports a workforce of IT professionals and system designers employed by Leidos Management Systems Designers, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Fixed Fee contracts if not managed diligently.
Long contract duration could lead to scope creep or evolving technological needs not fully addressed in the initial award.
Reliance on a single contractor for critical IT systems design could pose a risk if performance issues arise.

Positive Signals

Awarded through a full and open competition, indicating a vetted and potentially cost-effective solution.
The contractor, Leidos, is a well-established entity in the government contracting space, suggesting experience and capability.
The contract is a delivery order, implying it's part of a larger, potentially pre-vetted contract vehicle.

Sector Analysis

This contract falls within the Computer Systems Design Services sector, a critical component of the broader Information Technology (IT) industry. This sector is characterized by high demand for specialized skills in software development, system integration, and IT consulting. The market size for IT services to the federal government is substantial, with agencies like the IRS representing significant clients due to their complex operational needs and large data processing requirements. This contract likely supports the IRS's ongoing efforts to modernize its technological infrastructure.

Small Business Impact

The contract was awarded to Leidos Management Systems Designers, Inc., a large business. There is no indication of a small business set-aside for this specific delivery order. While the primary contract may have small business subcontracting goals, this particular award does not appear to directly benefit small businesses through a set-aside. The focus is on the prime contractor's capabilities.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the Internal Revenue Service. The Cost Plus Fixed Fee structure necessitates close monitoring of costs and performance to ensure adherence to the contract's objectives and budget. Transparency is generally maintained through contract reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

IRS IT Modernization Programs
Federal Civilian IT Services
Computer Systems Design and Related Services
Department of the Treasury IT Contracts

Risk Flags

Long contract duration
Cost Plus Fixed Fee pricing structure
Potential for scope creep

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $19.1 million to LEIDOS MANAGEMENT SYSTEMS DESIGNERS, INC.. ADDING INCREMENTAL FUNDING (MSD)

Who is the contractor on this award?

The obligated recipient is LEIDOS MANAGEMENT SYSTEMS DESIGNERS, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $19.1 million.

What is the period of performance?

Start: 2006-05-29. End: 2013-04-26.

What is the historical spending pattern for Leidos Management Systems Designers, Inc. with the IRS for similar services?

Analyzing Leidos Management Systems Designers, Inc.'s historical spending with the IRS for similar computer systems design services requires access to detailed federal procurement databases. However, given the contract's duration (2524 days) and the nature of IT system design, it suggests a significant and ongoing relationship. Typically, large IT service providers like Leidos engage in multiple contracts with major agencies like the IRS, often through various contract vehicles and task orders. Examining past performance, contract modifications, and on-time delivery rates for previous IRS contracts would provide a clearer picture of their track record and the value delivered in comparable engagements. Without specific historical data for this contractor and agency pairing, it's difficult to provide precise figures, but the scale of this award implies a substantial prior engagement or a strong competitive win.

How does the awarded amount of $19.1 million compare to the total contract value this delivery order falls under?

The provided data indicates an award amount of $19,139,600.69 for this specific delivery order (DO). However, the total value of the parent contract under which this DO was issued is not specified in the provided data. Delivery orders are typically issued against indefinite-delivery, indefinite-quantity (IDIQ) contracts or other multiple-award contract vehicles. Therefore, this $19.1 million represents a portion of a potentially much larger overall contract ceiling. To accurately assess value, one would need to know the total contract ceiling, the number of other delivery orders issued against it, and the total amount obligated across all orders. Without this context, comparing this single DO's value to the overall program's financial scope is not possible.

What are the key performance indicators (KPIs) used to measure the success of this computer systems design contract?

Key Performance Indicators (KPIs) for a computer systems design services contract like this one, awarded to Leidos Management Systems Designers, Inc. by the IRS, typically focus on technical performance, project management, and adherence to requirements. Common KPIs include system uptime and availability, defect density in delivered code, on-time completion of project milestones, adherence to budget (especially relevant for CPFF contracts), user satisfaction with the designed systems, and successful integration with existing infrastructure. For the IRS, specific KPIs might also relate to the efficiency and security of tax processing systems. The contracting officer and technical monitors would establish these KPIs in the contract's Performance Work Statement (PWS) and monitor them throughout the contract's lifecycle.

What is the risk associated with the Cost Plus Fixed Fee (CPFF) contract type for this specific engagement?

The Cost Plus Fixed Fee (CPFF) contract type carries inherent risks for both the government and the contractor. For the government, the primary risk is that the contractor may have less incentive to control costs compared to fixed-price contracts, as costs are reimbursed. However, the 'fixed fee' component provides the contractor with a defined profit margin, incentivizing them to complete the work efficiently to maximize their return on that fee. The risk for the government lies in ensuring that the 'cost' portion is managed effectively through robust oversight and auditing. For the contractor, the risk is that the estimated costs might be underestimated, leading to a lower-than-expected profit if the fixed fee is insufficient to cover the actual effort. In this IRS contract, the risk is mitigated by the competitive award and the expectation of strong government oversight to manage expenditures.

How has the IRS's spending on computer systems design services evolved over the past five years?

To provide an accurate analysis of the IRS's spending evolution on computer systems design services over the past five years, access to detailed historical procurement data is necessary. Generally, federal agencies like the IRS face continuous pressure to modernize their IT infrastructure to enhance efficiency, security, and taxpayer services. This often translates to sustained or increasing investment in areas like computer systems design. Factors such as evolving tax laws, cybersecurity threats, and the need for better data analytics can drive demand for new or upgraded systems. Without specific data, it's presumed that the IRS has maintained a significant budget allocation for IT services, including system design, to meet its complex operational requirements and adapt to technological advancements.

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: 103

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 2677 PROSPERITY AVE., SUITE 700, FAIRFAX, VA, 11

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $35,508,299

Exercised Options: $33,332,566

Current Obligation: $19,139,601

Parent Contract

Parent Award PIID: TIRNO06D00013

IDV Type: IDC

Timeline