The Internal Revenue Service has awarded what could turn out to be the largest information technology services contract ever to Computer Sciences Corp.
Under the contract, known as "Prime," CSC, a California company with a large Washington presence, will head a team of IT experts working to overhaul IRS systems over the next 10 to 15 years. Although the agency would not disclose the possible value of the contract, it's been estimated at $2 billion.
CSC not only will update the service's vintage-1960s computer systems, but also will help the IRS modernize its business operations and the services it provides to the public. The agency and CSC will spend the next six months getting a management structure and more detailed modernization plan in place.
CSC beat out a team headed by Lockheed Martin Corp. for the contract. An agency fact sheet said the CSC team "was chosen for its stronger strategic technical and strategic business approaches." The winning team also includes Northrop Grumman, KPMG Peat Marwick, Unisys Corp., IBM Corp., Lucent Technologies and Science Applications International Corp.
High-priority projects under the Prime contract include improving IRS's accessibility to the public by telephone and the Internet, expanding electronic tax filing and giving IRS employees access to taxpayer records online while preserving security.
"In time, this project will touch on every facet of the IRS," said the agency's chief information officer, Paul Cosgrave, who is heading the modernization program. "It will cover everything from updating our core data systems for tax records to helping process taxpayer refund checks."
IRS Commissioner Charles Rossotti cautioned that no immediate results will be visible. "We want to do this carefully; we want to do this right," he said. The IRS has been criticized extensively for spending $3.4 billion on previous modernization efforts, to little avail.
The agency expects to spend $10.5 million on the project's first six months and to draw on a special fund of $506 million that Congress set aside for modernization, subject to congressional oversight.