CPOC Consolidation Determination Memo_Rev2_Redacted.pdf

Determination that Consolidation is Necessary and Justified

March 24, 2026

This determination is made in accordance with (IAW) Class Deviation (CD) —Revolutionary Federal Acquisition Regulation (FAR) Overhaul (RFO) Part 7, Defense FAR Supplement (DFARS) Part 207 (CD 2026- O0020) and 15 U.S.C. 657q. This determination details the research and analysis performed in order to justify that partial consolidation is appropriate, necessary, and justified, and in the best interest of the Government.

A. Background

Solicitation number: HS002126RE015 Requirement: Case Processing Operations Center (CPOC) 2.0 Estimated Value (inclusive of all options):

DCSA requires support services for background investigations for Federal Government applicants, employees, and Contractors performing sensitive work, as well as individuals being investigated due to Federal regulatory requirements. This requirement is currently fulfilled through a sole source contract HS002126CE004 with performance period ending on July 31, 2026. DCSA also requires support services for continuous vetting (CV) alert processing, which was previously provided as a part of HS002121C0002, the Personnel Security Support Services (PS3) contract. By the recommendation of DCSA’s Transformation Workforce Implementation Group (TWIG), as approved by the DCSA Deputy Director, it was determined to be in the best interest of the Government to partially consolidate the CV portion of HS002121C0002 (PS3) and the CPOC requirements under HS002126CE004. The remainder of the PS3 requirement (adjudication support and personnel security support for industry) is not part of the consolidation and will remain a standalone requirement. DCSA is expected to improve productivity and decrease costs as a result of this partial consolidation. This is the first instance of consolidation for these acquisitions. Additionally, partial consolidation of these requirements also supports the agency’s strategic goals by creating a shift in how the overall CV requirement will be executed moving forward.

These long-standing, enduring acquisition requirements have been continuously fulfilled under previous contracts. The CPOC requirement, ongoing for nearly 20 years, transitioned from ethe Office of Personnel Management's (OPM) National Background Investigations Bureau (NBIB) to the DCSA. The PS3 requirement has been contracted since 2013, previously under the Washington Headquarters Service and the former Defense Security Service, The below chart contains the most recent contracts for CPOC and PS3, administered by DCSA Procurement Solutions (PRS).

Contract No. Contractor Name

Acquisition Strategy

Description Period of Performance

Contract Value

HS002126CE004* ASRC Federal Administrative Services LLC

8(a), Sole source*

Case Processing Operations Center Bridge

2/1/2026 – 10/31/2026**

HS002121C0002*** iWorks Corporation

100% Small Business set-aside

Personnel Security Support Services (PS3)

1/5/2021 – 7/4/2026

*Note: Although CPOC bridge contract HS002126CE004 was accepted into the 8(a) program, the Small Business Administration (SBA) representative confirmed that since a bridge contract is a one time shore term stopgap and is considered a new requirement, there would not be a follow-on of the same scope and work. Therefore, the next contracting action would also be considered new and separate from the bridge contract, thus not requiring a release from the 8(a) program, since the underlying requirement was never in the 8(a) program.

**Note: The current period of performance (POP) of HS002126CE004 ends on July 31, 2026. There is a three-month option period with a POP of August 1, 2026 to October 31, 2026.

***Note: Only the CV tasks under HS002121C0002 will be consolidated, estimated value is approximately $46 million for a five year period of performance (PoP).

B. Selection of Acquisition Strategy -

The acquisition team performed the following steps and analyses IAW RFO FAR 7.107-2(c)(6) in selecting the recommended acquisition strategy:

1. Market research:

The Government posted a request for information (RFI) to the Government point-of-entry, SAM.gov on February 13, 2026 which a closing date of March 2, 2026. A total of 33 responses were received, of which 28 were submitted by small businesses. The Government reviewed each response to ascertain whether the respondents possessed the capability to perform the CPOC

2.0 requirement. The Government also performed a verification check using the System for Award Management (SAM) website to confirm each vendor’s status as a small business under the North American Industry Classification System (NAICS) for this effort (561611 – Investigation and Personal Background Check Services). Based upon this analysis, the Government assessed that there are seven small businesses which are currently certified as a small business under NAICS 561611 and appear capable of executing the CPOC 2.0 requirements. These seven small businesses represent a sufficient basis for ensuring adequate competition. The Government has determined that there is a reasonable expectation of receiving proposals from at least two or more responsible small business concerns at a fair market price. This satisfies the threshold for a 100% small business set-aside under RFO FAR 19.104-1(a).

2. Alternative contracting approaches that would involve a lesser degree of consolidation:

DCSA examined other contracting approaches to include the following:

• The CPOC and CV requirements remain separate; CV remains on the PS3 contract and with the Federal CV analysts and CPOC remains a standalone contract.

• CV requirements are solicited and awarded as a separate contract.

This alternative was rejected as it perpetuates operational seams between closely related functions, increases the risk of data discrepancies, and complicates government oversight;

directly undermining the goal of a single, integrated personnel vetting mission.

3. Coordination:

The determination has been coordinated with DCSA’s Office of Small Business Programs (OSBP).

4. Negative impact by the acquisition strategy on contracting with small business concerns:

DCSA acknowledges that even as a small business set-aside, a larger, more complex consolidated CPOC 2.0 contract could reduce the pool of small businesses that can realistically compete as a prime contractor. The CPOC 1.0 follow-on solicitation received proposals and PS3 follow-on solicitation received proposals. Both initial follow-ons were small business set-asides demonstrating that a small business could fulfill the CPOC and CV requirements separately as a prime contractor. Given the robust interest in this partially consolidated requirement by small businesses, the negative impact is minimized since the market research has demonstrated that small businesses could still compete as a prime contractor. Multiple responses to the RFI for CPOC 2.0 also indicated that vendors planned to team with other small businesses. This could create greater opportunities for teaming arrangements for other small businesses.

The initial interest in the partially consolidated CPOC 2.0 contract is significant and while not all of the respondents may elect to submit a proposal, the demand signal is strong enough to support that small businesses are not being excluded as a result of this partial consolidation.

Additionally, it is expected that portion of the PS3 requirement that is not transitioning to CPOC will continue to be a valid requirement which will still remain a separate contract, set aside for small business.

5. Steps taken to include small business concerns in the acquisition strategy:

DCSA timely notified each incumbent contractor (CPOC and PS3) of the Government’s intent to partially consolidate. DCSA posted the RFI for 18 calendar days to allow sufficient time to notify industry and assess small business’ capability of performing the partially consolidated requirement in order to ensure the requirement could remain a small business set-side. The portion of the PS3 requirement which was not consolidated will also remain a small business set-aside. DCSA posted a presolicitation notice (synopsis) IAW RFO FAR 5.101. Finally, DCSA intends to issue a draft request for proposal (RFP) for comment/question prior to the release of the final

RFP.

C. Benefits of Consolidation

1. Cost savings or price reductions:

DCSA expects to see cost savings of approximately $15.2 million across a five-year PoP (approximately $3 million/year) as a result of this partial consolidation. This is approximately 3.5% of the total contract value. This figure is based upon the transition of the National Capital Region (NCR) to Boyers, PA, where the market labor costs are significantly lower than the NCR.1 A detailed cost analysis is maintained in the official contract file.

This consolidation represents a fiscally prudent and strategically sound decision that will generate a significant return on investment for the agency. By realizing $15.2 million in verified cost savings over the next five years, we are not merely reducing expenditures; we are unlocking critical resources that can be reinvested into our core mission and modernization priorities. This action demonstrates our commitment to being responsible stewards of taxpayer dollars. The 3.5% reduction in total contract value is achieved not by reducing resources, but through intelligent realignment of our operational footprint to a more cost-effective location, a move that is both logical and long overdue.

If this partial consolidation is not achieved, DCSA expects to pay approximately $36.5 million across the five-year PoP for labor under the PS3 contract (approximately $7.3 million annually).

Whereas the same number of FTEs in Boyers is estimated to cost approximately $21.6 million across the 5-year PoP for labor (approximately $4.3 million annually). The transition of these functions to Boyers, PA, is a data-driven decision, directly leveraging the lower market labor costs to the government's advantage without compromising operational output. This is a clear path of success for the agency's budget and mission.

2. Quality improvements that will save time or enhance performance or efficiency:

The overall objectives of the CPOC and CV requirements have always been very closely related and over time, DCSA has moved from separate silos supporting parts of the background investigation mission to a single, all-encompassing personnel vetting mission. Based upon this, it is anticipated that there will be significant quality improvements and efficiencies achieved through this partial consolidation. In the solicitation, the offerors will be encouraged to develop innovative strategies to staff the resultant contract while taking into account future changes in DCSA business operations. Offerors are also encouraged to cross-train contractor personnel to allow for sufficient support on all aspects of the CPOC 2.0 requirement. To ensure these efficiencies are realized, the Request for Proposal (RFP) will include specific evaluation factors that reward offerors who propose innovative staffing models and a robust cross-training plan to support all aspects of the personnel vetting mission.

Key improvements include:

Unified Process Ownership: By placing case processing and CV alert resolution under a single contractor, we eliminate the operational seam and data stovepipes that exist between two contracts. By establishing a single, unwavering point of accountability, this consolidation replaces a fractured process with a seamless, high-velocity vetting pipeline. This ensures that from initiation to adjudication, every case is managed under a unified quality standard, eliminating the delays and errors inherent in handoffs between different contractors. This move liberates government personnel from duplicative administrative burdens, enabling our Contracting Officer's Representatives (CORs) to pivot from tactical contract management to high-

1 Attachment 1: CPOC Cost Comparison CV Excel Spreadsheet value strategic oversight. Their focus will shift to driving performance, innovation, and mission outcomes rather than refereeing disparate contracts.

Reduced Government Oversight Burden: Managing one consolidated contract instead of two separate ones significantly streamlines contract administration. This allows government personnel, including Contracting Officer's Representatives (CORs), to apply consistent quality standards and focus on strategic performance management rather than duplicative administrative tasks.

Enhanced Data Integrity and Analysis: A single contractor will have end-to-end visibility into all case data. This consolidated data stream enables more powerful trend analysis to proactively identify and remedy systemic quality issues or process bottlenecks, leading to more consistent and reliable investigative products. Consolidating our data under a single prime contractor transforms our approach to quality management from reactive to proactive and predictive. With end-to-end visibility, we can perform powerful trend analysis to identify and neutralize systemic issues before they impact the quality and timeliness of our investigative products.

3. Operational Benefits:

Beyond quantifiable savings and IAW RFO FAR 7.107-2(c)(4) this consolidation is a critical strategic action to mitigate risk and standardize operations during a period of significant agency transformation. The consolidation is not merely advantageous; it is a mission imperative. The successful deployment of enterprise-level initiatives like Trusted Workforce (TW) 2.0 and NBIS is directly contingent upon having a unified, end-to-end operational framework. Proceeding without this consolidation would introduce untenable friction and unacceptable risk to these critical national security programs. The future state envisioned with NBIS is one of a unified digital environment where Initial Vetting and CV activities are seamlessly integrated. By placing the end-to-end process under a single prime contractor now, DCSA ensures that one entity is responsible for staffing, cross-training, and executing the entire vetting mission. This approach breaks down the knowledge silos that naturally form between separate contracts, fostering a comprehensive understanding of the entire vetting lifecycle and ensuring best practices are shared across all functions. It proactively dismantles the operational seams and data stovepipes that currently threaten our agility. By creating a single, integrated vetting pipeline, we are de-risking our modernization roadmap and ensuring that our most critical transformation efforts are built on a solid and coherent foundation.

Furthermore, with a single point of ownership for the entire process, the contractor is inherently incentivized to propose and implement holistic innovations that drive efficiency across the entire mission, rather than optimizing in isolated silos. This partial consolidation guarantees that process standards are aligned and consistently applied, which will standardize operations, increase overall productivity, and ultimately accelerate the successful implementation of these mission-critical initiatives. The alternative, maintaining two separate contracts, perpetuates a fragmented and outdated operational model that is fundamentally incompatible with the speed, integration, and security demands of TW 2.0 and NBIS. This consolidation is the essential first step in building the agile, holistic mission environment of the future. DCSA expects to improve productivity and further decrease costs as a result of this partial consolidation as the contractor identifies efficiencies. The resultant contract will include FAR clause 52-248-1 “Value Engineering”, to enable contractors to voluntarily suggest methods for performing more economically and share in any resulting savings.

D. Need for Consolidation

While the quantifiable expected benefits under this partial consolidation do not exceed the threshold for substantialness IAW RFO FAR 7.107-2(c)(3)(ii), the non-quantifiable benefits identified herein, are critical to DCSA’s mission success. This consolidated approach is critical to mitigating risks during the agency's transition to TW 2.0 and the NBIS. By placing these closely related vetting functions under a single contractor, DCSA eliminates the risk of operational disconnects, data stovepipes, and conflicting priorities that could arise from managing two separate contracts during this critical agency transformation. The anticipated operational risks and quality degradation of maintaining separate contracts during this time are unacceptable. Consolidation is the only viable path to mitigate these risks.

The acquisition strategy provides for maximum practicable participation by small business concerns.

E. Determination

Based on the above facts, I determine that in accordance with RFO FAR 7.107-2:

1. The necessary steps have been taken to support the need for consolidation.

2. The benefits of the acquisition are critical to the agency’s mission success.

3. As a result, consolidation for the above referenced requirement is necessary and justified.

Branch Chief and Contracting Officer Mission A Procurement Solutions

Concurrence:

Office of Small Business Programs

Head of the Contracting Activity

Approval:

Senior Procurement Executive