USDA awards $142.5M for enterprise infrastructure, Lumen Technologies secures major contract

Contract Overview

Contract Amount: $142,521,333 ($142.5M)

Contractor: Lumen Technologies Government Solutions, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2021-12-16

End Date: 2026-09-30

Contract Duration: 1,749 days

Daily Burn Rate: $81.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: USDANET ENTERPRISE INFRASTRUCTURE SOLUTIONS

Place of Performance

Location: FORT COLLINS, LARIMER County, COLORADO, 80526

State: Colorado Government Spending

Plain-Language Summary

Department of Agriculture obligated $142.5 million to LUMEN TECHNOLOGIES GOVERNMENT SOLUTIONS, INC. for work described as: USDANET ENTERPRISE INFRASTRUCTURE SOLUTIONS Key points: 1. Contract value represents a significant investment in telecommunications infrastructure. 2. Full and open competition suggests a potentially competitive bidding process. 3. The contract duration of nearly 5 years indicates a long-term need for these services. 4. Wired Telecommunications Carriers is a mature industry, suggesting established market rates. 5. The award type as a Delivery Order implies it's part of a larger contract vehicle. 6. The use of Time and Materials pricing may introduce cost variability. 7. The contract is managed by the Office of the Chief Financial Officer, indicating financial oversight.

Value Assessment

Rating: fair

Benchmarking the value of this $142.5 million contract requires comparison to similar enterprise-wide telecommunications infrastructure procurements. Given the duration and scope, the price appears within a reasonable range for large-scale government IT services. However, the Time and Materials pricing structure introduces a degree of uncertainty regarding the final cost, making a precise value-for-money assessment challenging without detailed labor rates and material markups. Further analysis of the specific services delivered and their necessity would refine this assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 2 bids suggests a moderate level of competition for this significant telecommunications infrastructure requirement. While two bidders participated, the specific details of the bidding process, including the number of proposals received and the evaluation criteria, are not fully detailed here. A higher number of bidders would typically indicate stronger price discovery.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a more competitive environment, which can lead to lower prices and better service offerings. The presence of at least two bidders suggests that taxpayers are likely receiving a fair price, though the exact savings compared to a sole-source award cannot be determined without more information.

Public Impact

The primary beneficiaries are the various agencies within the Department of Agriculture, which will receive enhanced wired telecommunications services. The contract supports the delivery of essential network infrastructure and related telecommunications services critical for USDA operations. The geographic impact is likely nationwide, supporting USDA facilities and personnel across the United States. Workforce implications may include the need for specialized telecommunications technicians and support staff by the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials pricing can lead to cost overruns if not closely monitored.
The duration of the contract (nearly 5 years) means potential for technological obsolescence if not managed proactively.
Reliance on a single awardee for enterprise-wide infrastructure creates vendor lock-in risk.

Positive Signals

Awarded under full and open competition, suggesting a competitive process.
The contract is for essential enterprise infrastructure, indicating a critical need.
The award is managed by the Office of the Chief Financial Officer, implying financial oversight.

Sector Analysis

This contract falls within the Wired Telecommunications Carriers industry, a sector characterized by established infrastructure and evolving technologies. The market is dominated by large providers offering a range of services from basic connectivity to complex network solutions. Government spending in this sector is substantial, driven by the need for reliable and secure communication networks. Comparable spending benchmarks would involve analyzing other large-scale federal contracts for enterprise network services and telecommunications infrastructure across various agencies.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large enterprise-level telecommunications contract, it is unlikely to involve significant subcontracting opportunities for small businesses directly related to the core service delivery. The focus is on a large incumbent provider, Lumen Technologies, which typically manages its own extensive network infrastructure.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Agriculture's contracting officers and the Office of the Chief Financial Officer. Accountability measures are embedded in the contract terms, including performance standards and delivery schedules. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

USDA IT Modernization Initiatives
Federal Telecommunications Services (FTS) Contracts
Enterprise Infrastructure Solutions (EIS) Program
General Services Administration (GSA) Schedules

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Risk of vendor lock-in given the enterprise-wide scope.
Need for continuous monitoring of service delivery against SLAs.
Potential for technological obsolescence over the contract duration.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $142.5 million to LUMEN TECHNOLOGIES GOVERNMENT SOLUTIONS, INC.. USDANET ENTERPRISE INFRASTRUCTURE SOLUTIONS

Who is the contractor on this award?

The obligated recipient is LUMEN TECHNOLOGIES GOVERNMENT SOLUTIONS, INC..

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Office of the Chief Financial Officer).

What is the total obligated amount?

The obligated amount is $142.5 million.

What is the period of performance?

Start: 2021-12-16. End: 2026-09-30.

What is the historical spending pattern for enterprise infrastructure solutions within the Department of Agriculture?

Analyzing historical spending for enterprise infrastructure solutions within the Department of Agriculture requires examining past contract awards for similar services. This includes looking at predecessor contracts to the current USDANET ENTERPRISE INFRASTRUCTURE SOLUTIONS, as well as other large-scale network and telecommunications procurements. Trends might reveal increasing or decreasing investment in this area, shifts in technology focus (e.g., from wired to wireless, or cloud integration), and the typical contract values and durations awarded. Understanding these patterns helps contextualize the current $142.5 million award and assess if it aligns with historical investment levels or represents a significant deviation.

How does the awarded price compare to market rates for similar wired telecommunications services?

A direct comparison of the awarded price to market rates for similar wired telecommunications services is complex without detailed service specifications. However, given that Lumen Technologies is a major telecommunications provider and the contract was awarded under full and open competition with two bids, the price is likely competitive within the industry for enterprise-level solutions. The Time and Materials (T&M) pricing structure means the final cost will depend on actual hours worked and materials used. Benchmarking would involve comparing the estimated labor rates and material markups against industry averages for comparable government or commercial contracts of similar scale and scope.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract?

The provided data does not detail the specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. However, for an enterprise infrastructure solutions contract of this magnitude, typical KPIs would likely include network uptime, latency, bandwidth availability, incident response times, and resolution times. SLAs would define the minimum acceptable performance levels for these metrics, often with associated penalties for non-compliance and potential service credits for the government. These are crucial for ensuring the contractor, Lumen Technologies, delivers reliable and high-quality telecommunications services as expected by the Department of Agriculture.

What is Lumen Technologies' track record with large federal telecommunications contracts?

Lumen Technologies (and its predecessor entities like CenturyLink) has a significant track record of securing and performing on large federal telecommunications contracts. They are a major player in the government IT and telecommunications space, often participating in large-scale procurements like the General Services Administration's (GSA) Enterprise Infrastructure Solutions (EIS) program. Their history includes managing complex networks, providing secure communication services, and supporting various federal agencies. Evaluating their past performance on similar contracts, including any past performance issues or commendations, would provide context for their ability to successfully execute this $142.5 million USDA award.

What are the potential risks associated with the Time and Materials (T&M) pricing structure for this contract?

The primary risk associated with the Time and Materials (T&M) pricing structure for this contract is the potential for cost overruns. Unlike fixed-price contracts, T&M contracts do not have a predetermined total cost. If the contractor's labor hours or material costs exceed initial estimates, the total expenditure for the Department of Agriculture could be significantly higher than anticipated. This necessitates robust oversight and diligent monitoring by the government to ensure that hours billed are reasonable and necessary, and that material costs are fair and competitive. Without strong controls, T&M can lead to less predictable budgeting and potentially higher overall spending.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - NETWORK

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 12314420R0006

Offers Received: 2

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 931 14TH STE 1000 B, DENVER, CO, 80202

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $1,241,598,442

Exercised Options: $460,399,172

Current Obligation: $142,521,333

Actual Outlays: $113,061,484

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q17NSD3006

IDV Type: IDC

Timeline