Treasury's IRS Spends $34.7M on Mail Equipment Maintenance with Bell and Howell, LLC

Contract Overview

Contract Amount: $34,702,714 ($34.7M)

Contractor: Bell and Howell, LLC

Awarding Agency: Department of the Treasury

Start Date: 2012-07-11

End Date: 2019-01-31

Contract Duration: 2,395 days

Daily Burn Rate: $14.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::OT::IGF OTHER FUNCTIONS MAIL EQUIPMENT MAINTENANCE

Place of Performance

Location: DETROIT, WAYNE County, MICHIGAN, 48226

State: Michigan Government Spending

Plain-Language Summary

Department of the Treasury obligated $34.7 million to BELL AND HOWELL, LLC for work described as: IGF::OT::IGF OTHER FUNCTIONS MAIL EQUIPMENT MAINTENANCE Key points: 1. Significant spending on a niche service: Computer and Office Machine Repair and Maintenance. 2. Sole-source contract awarded to Bell and Howell, LLC, raising questions about competition. 3. Long contract duration (2395 days) suggests potential for price drift. 4. No small business participation noted.

Value Assessment

Rating: questionable

The contract value of $34.7 million over nearly 7 years for mail equipment maintenance is substantial. Without competitive bidding, it's difficult to assess if this represents fair market value compared to similar services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to Bell and Howell, LLC. This lack of competition limits price discovery and potentially leads to higher costs for taxpayers.

Taxpayer Impact: The absence of competition likely results in a higher price than could have been achieved through a competitive process, impacting taxpayer funds.

Public Impact

Taxpayers may be overpaying for essential mail equipment maintenance due to a lack of competition. The long-term nature of the contract could lock the IRS into potentially suboptimal service or pricing. Lack of transparency in the procurement process raises concerns about accountability.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Long contract duration
No small business participation

Positive Signals

Definitive contract type
Firm fixed price contract

Sector Analysis

The IT and administrative services sector often involves long-term maintenance contracts. Benchmarks for similar mail equipment maintenance contracts are difficult to ascertain without competitive data, but $34.7M is a significant sum.

Small Business Impact

The contract data indicates no small business participation (sb: false). This suggests that opportunities for small businesses to compete for or be subcontracted on this maintenance service were not pursued.

Oversight & Accountability

The sole-source nature of this contract warrants further oversight to ensure the IRS received fair value and that the justification for not competing the award was sound.

Related Government Programs

Computer and Office Machine Repair and Maintenance
Department of the Treasury Contracting
Internal Revenue Service Programs

Risk Flags

Lack of competition
Potential for overpayment
Long contract duration
No small business involvement

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $34.7 million to BELL AND HOWELL, LLC. IGF::OT::IGF OTHER FUNCTIONS MAIL EQUIPMENT MAINTENANCE

Who is the contractor on this award?

The obligated recipient is BELL AND HOWELL, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $34.7 million.

What is the period of performance?

Start: 2012-07-11. End: 2019-01-31.

What was the justification for awarding this contract on a sole-source basis instead of competing it?

The provided data does not specify the justification for the sole-source award. Typically, sole-source contracts are justified when only one responsible source can provide the required supplies or services, or in cases of urgent need. Further investigation would be required to determine the specific rationale used by the IRS.

How does the per-unit cost of this maintenance compare to industry standards, given the lack of competitive bids?

Without competitive bids or publicly available benchmarks for this specific type of mail equipment maintenance, a direct per-unit cost comparison is not feasible. The lack of competition makes it challenging to ascertain if the pricing is aligned with market rates or if taxpayers are incurring additional costs.

What is the potential risk to IRS operations if Bell and Howell, LLC's service is interrupted, given the sole-source nature of the contract?

The sole-source nature of this contract presents a significant operational risk. If Bell and Howell, LLC were unable to fulfill its obligations, the IRS might face substantial delays or disruptions in mail processing, as finding an alternative provider quickly would be difficult and potentially costly due to the lack of pre-established competitive relationships.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Computer and Office Machine Repair and Maintenance

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: TIRWR-11-R-00011

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 760 S WOLF RD, WHEELING, IL, 60090

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $35,023,296

Exercised Options: $34,703,624

Current Obligation: $34,702,714

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline