SF 1012-LSJ DTIE-Redacted.pdf

DEPARTMENT OF THE TREASURY

LIMITED-SOURCES JUSTIFICATION

Acquisition Title: Digitalization Transformation, Integration and Innovation Support (DTIIS)

This acquisition is conducted under the authority of the Multiple Award Schedule Program (see FAR 8.401)

Treasury Standard Form – 1012 (Rev 12/24)

Prescribed by Treasury: DTAP 1008.405-6

Tracking No.

1. Identification of the agency and the contracting activity:

Requiring activity: The requiring activity is the Internal Revenue Service’s IT Enterprise Program Management Office’s (EPMO) Digital Transformation Program Office (DT PMO)

Contracting activity: Internal Revenue Service (IRS), Office of the Chief Procurement, Officer, Information Technology Strategy & Modernization Division; Enterprise Program Management Branch 2.a Nature and/or description of the action being approved:

The purpose of this limited-sources justification is to obtain approval to award a FFP Bridge contract for task orders 2032H5-23-F-00574/2032H5-23-F-00538 (Deloitte) to provide services described in section 3.a below. The need date for these services is no later than March 22, 2025. The period of performance will be a six-month base period with two, three months option periods.

Base: March 22, 2025 – September 21, 2025 Option Period 1: September 22, 2025 – December 21, 2025 Option Period 2: December 22, 2025 – March 21, 2026

The next generation acquisition package will be submitted to Procurement on March 3, 2025.

2.b Name of the vendor: Deloitte Consulting, LLP 2.c Requisition No.: 5000206258 2.d Bridge contract: Yes No 2.e Brand name: Yes No 3.a A description of the supplies or services required to meet the agency’s needs:

The DT PMO is responsible for the mission-critical Inflation Reduction Act (IRA) Digitalization implementation effort for IRS IT. The DT requires integration and innovation support to expand digital services and digitalization (taxpayers will be able to file all documents securely and exchange correspondence electronically), as part of the collective delivery of the IRS IRA vision. The DT PMO requires support to identify the initiative outcomes, define and manage the portfolio of projects required to achieve impact, and measure and report up and out to the IRA Initiative 1.2 Program Office, which in turn provides updates to the IRA Transformation and Strategy Office and Treasury on progress.

The DT PMO requires contractor support to provide expertise in communications, program and project management, technical solutions and analysis, Digital Enablement Platform, records management experience, Cloud Design and Requirements Package, Enterprise Lifecycle Management, governance and system integration support required to integrate modernized business solutions into the IRS.

This contract does contain a portion of Advisory & Assistance Services for some program and/or project management and administration support, however, the FAR 16.505(c)(2)(ii)

This acquisition is conducted under the authority of the Multiple Award Schedule Program (see FAR 8.401) restriction on ordering periods for A&A services is inapplicable to this award as it is a GSA task order, which has no ordering period.

The Office of Management and Budget (OMB) and the National Archives and Records Administration (NARA) issued joint memoranda; establishing several requirements to move Federal agencies to a fully electronic environment, where appropriate. Agencies may have been delayed in their electronic records transition process during the COVID-19 pandemic.

Memorandum M-19-21, Transition to Electronic Records and memorandum M-23-07, Update to Transition to Electronic Records [this memorandum applies to “Federal agencies” as defined by 44 U.S.C. § 2901(14)], directs all Federal agencies to:

1. Ensure that all Federal records are created, retained, and managed in electronic formats, with appropriate metadata; and

2. Consistent with records management laws and regulations, develop plans to close agency-operated storage facilities for paper and other, analog records, and transfer those records to Federal Records Centers operated by NARA or commercial storage facilities.

3.b Includes IT: Yes No - NAICS Code: 541512 (Computer Systems Design Services); PSC: DF01 3.c IGCE/Estimated dollar value:

The Independent Government Cost Estimate (IGCE) is ; inclusive of a six month base period with two three month option periods. Refer to the IGCE for additional details and the table below:

Base: 03/22/2025 – 09/21/2025:

Option 1: 09/22/2025 – 12/21/2025:

Option 2: 12/22/2025 – 03/21/2026:

4.a Identification of the authority being used (Check the appropriate box that applies).

FAR 8.405-6(a)(1)(i)(A) – An urgent and compelling need exists, and following the procedures would result in unacceptable delays.

FAR 8.405-6(a)(1)(i)(B) – Only one source is capable of providing the supplies or services required at the level of quality required because the supplies or services are unique or highly specialized.

FAR 8.405-6(a)(1)(i)(C) – In the interest of economy and efficiency, the new work is a logical follow-on to an original Federal Supply Schedule order or BPA provided that the original order or BPA was placed in accordance with FSS procedures in accordance with

This acquisition is conducted under the authority of the Multiple Award Schedule Program (see FAR 8.401) the applicable Federal Supply Schedule ordering procedures. The original order or BPA must not have been previously issued under sole-source or limited-sources procedures.

FAR 8.405-6(b) – Items peculiar to one manufacturer. (i.e., Brand Name specifications)

4.b Supporting Rationale:

Since June 2023, the EPMO program office has been seeking award of the estimated $1.8 billion dollar Enterprise Program Project Integration Services (EPPIS) Blanket Purchase Agreement (BPA) with the intent for to have it in place by May 2024, aligning with the period of performance end dates across several of the programs and providing sufficient time to transition to new task orders under the BPA. In the interim, the DT PMO has relied on support provided under task orders 2032H5-23-F-00574 and 2032H5-23-F-00538, both awarded to Deloitte Consulting under the Web Apps BPA Bridge (2032H5-23-A-00011), with the intent to consolidate the work under EPPIS. The EPPIS award was ultimately delayed until August 2024. Consequently, IRS extended the two Deloitte task orders through March 21, 2025 and February 28, 2025, respectively, to continue support and allow time for transition to EPPIS.

The EPPIS BPA award was protested in August 2024. Although corrective action was taken to resolve the protest issues, additional protests have been received and award is now projected to be delayed for six to nine months until potentially July 2025. As a result of this delay, the program office must now pivot away from the initial strategy and develop a new plan of action. The program office did not divert from EPPIS immediately after the initial protests were received in August 2024 and relied upon the initial corrective action to resolve the protest issues timely. The first steps toward an alternative strategy began in November 2024.

This was after additional protests were received and a decision was made to pursue a more extensive and lengthy corrective action strategy. This decision drove the move to a new action plan.

The program office is conducting market research to develop an acquisition strategy for a full recompete of this requirement; however, a sole source bridge contract is necessary in the interim to allow time for the development, planning and execution of that strategy. A bridge contract to the current vendor that consolidates these two task orders would ensure that there is no gap in service and allow time for transition to a new contract vehicle. Deloitte has the requisite knowledge, experience and personnel in place to continue support without interruption. Deloitte has been providing these services for more than a year and has a working knowledge of the processes and systems that have contributed to the success of deliveries. Any interruption to this support will result in unacceptable delays and missing mandatory delivery deadlines for FY25 Quarter 2 and Filing Season 24 capabilities. This includes the following projects with key deliverables: Digital and Mobile Adaptative Forms, Document Upload Tool, SCRIPS Modernization, Digital Enablement Platform, Digital Inventory Management, Digital Content Retrieval, Historical Digitalization activities, Operational Data Store, and the Quality Control Review Tool.

This acquisition is conducted under the authority of the Multiple Award Schedule Program (see FAR 8.401)

All IT DT mission critical programs (with public commitments to the American people) will cease. The accelerated delivery timelines cannot be missed, these deadlines will be at risk without this critical support.

Delivery timelines have accelerated in FY25 and FY26 with the IRS having made the following public facing commitments:

By December 2025, IRS will digitize 95% of paper filed tax returns and information returns.

By December 2025, IRS will digitize 50% of paper-submitted correspondence, non-tax forms, and notice responses.

By December 2025, IRS will digitize 30% - 50% of historical returns.

In order to deliver expanded digital mobile formats, scanning at point of entry all paper tax forms, scanning correspondence and non-tax forms, digitally extracting data from scanned tax forms and expanding similar processes across IRS, resources are needed to support the expanded scope and accelerated timelines. Without PMO support, these critical efforts supporting the day-to-day operations and execution of IT DT will cease.

5. A determination by the ordering activity Contracting Officer that the order or BPA represents the best value consistent with FAR 8.404(d):

The Contracting Officer has determined that the bridge contract represents the best value consistent with FAR 8.404(d) and lowest overall cost alternative (considering price, special features, administrative costs) to meet the Government’s needs based on an analysis of the pricing offered under the current task orders. The task orders were competitively awarded under the WebApps BPA Bridge, which was awarded under the contractor’s GSA Multiple Award Schedule (MAS) contract. The Contracting Officer will conduct a comparison and analysis to ensure that the proposed pricing is consistent with the contractor’s MAS contract, the previous task orders and the IGCE.

6. A description of the market research conducted among schedule holders and the results or a statement why market research was not conducted:

Due to the urgent nature of this acquisition, market research consisted of reviewing the acquisition history of the current task orders and similar requirements. However, the IRS released a Request for Information (RFI) on November 25, 2024, to identify potential sources with the aim of developing a competitive acquisition strategy for the subsequent follow-on of this requirement. The notice closed on December 6, 2024, and the Government has received over 90 responses and is in the process of finalizing the results. This summary of the Market Research will be applied to the follow-on acquisition strategy to this bridge procurement.