Commerce Department awards $9.5M contract for network operations support to Halvik, LLC

Contract Overview

Contract Amount: $9,561,878 ($9.6M)

Contractor: Halvik, LLC

Awarding Agency: Department of Commerce

Start Date: 2024-08-08

End Date: 2027-01-31

Contract Duration: 906 days

Daily Burn Rate: $10.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: NETWORK OPERATIONS SUPPORT (NOS) SERVICES

Place of Performance

Location: ALEXANDRIA, ALEXANDRIA CITY County, VIRGINIA, 22313

State: Virginia Government Spending

Plain-Language Summary

Department of Commerce obligated $9.6 million to HALVIK, LLC for work described as: NETWORK OPERATIONS SUPPORT (NOS) SERVICES Key points: 1. Contract value of $9.5M over approximately 2.5 years suggests a moderate investment in IT infrastructure. 2. The contract was awarded under full and open competition, indicating a potentially competitive bidding process. 3. Fixed-price contract type may incentivize cost control by the contractor. 4. The award to Halvik, LLC, a single entity, requires scrutiny of their past performance and capacity. 5. Network operations support is critical for the functioning of the U.S. Patent and Trademark Office. 6. The duration of the contract (906 days) allows for sustained support but also necessitates performance monitoring.

Value Assessment

Rating: fair

The contract value of $9.5 million for network operations support over roughly 2.5 years averages to approximately $3.8 million annually. Benchmarking this against similar IT support contracts is challenging without more specific service details. However, the firm-fixed-price structure suggests an expectation of predictable costs. Further analysis would require comparing the scope of services to industry standards and the pricing of comparable contracts awarded by other federal agencies or within the private sector.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which implies that while the competition was broad, specific sources may have been excluded for defined reasons. The data indicates two bids were received. A low number of bidders, even under full and open competition, can sometimes limit price discovery and potentially lead to higher prices than if more vendors had participated.

Taxpayer Impact: While the competition level was broad, the low number of bids received may mean taxpayers did not benefit from the most aggressive pricing possible. However, the firm-fixed-price nature should provide some cost certainty.

Public Impact

The U.S. Patent and Trademark Office (USPTO) benefits from reliable network operations, ensuring its internal systems and public-facing services function smoothly. This contract supports critical IT infrastructure, enabling the USPTO to process patent and trademark applications efficiently. The primary beneficiaries are USPTO employees who rely on stable network services for their daily work, and the public who access USPTO online resources. The contract's geographic impact is centered around the USPTO's operational locations, primarily in Virginia. Workforce implications may include direct employment for Halvik, LLC staff performing network operations and indirect support for USPTO IT personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (2 bidders) could indicate potential for higher costs than a more robust bidding environment.
The specific reasons for 'Exclusion of Sources' in a full and open competition need to be understood to ensure fairness and prevent artificial market limitation.
Reliance on a single contractor for critical network operations presents a risk if performance issues arise or if the contractor faces financial instability.

Positive Signals

Firm-fixed-price contract type incentivizes contractor efficiency and cost management.
Awarding under full and open competition, even with exclusions, suggests an attempt to leverage market forces.
The contract duration allows for stable, ongoing support, reducing disruption from frequent vendor changes.

Sector Analysis

The IT services sector, particularly computer systems design and related network support, is a significant area of federal spending. This contract falls within the broader category of IT infrastructure management, essential for government agencies to operate effectively. The market for such services is competitive, with numerous firms offering specialized support. The USPTO's spending on network operations is a component of its overall IT budget, which aims to maintain and upgrade its technological capabilities to support its mission.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'ss' being false. There is no explicit information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal unless Halvik, LLC voluntarily engages small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Commerce's contracting officers and the U.S. Patent and Trademark Office's program managers. Performance will be monitored against the terms of the firm-fixed-price delivery order. Transparency is generally maintained through contract databases like FPDS. Accountability rests with Halvik, LLC to meet performance requirements and with the agency to ensure proper oversight and payment.

Related Government Programs

Federal IT Infrastructure Modernization Programs
USPTO IT Support Services
Network Security and Operations Contracts
Computer Systems Design Services

Risk Flags

Limited Competition
Potential for Price Inflation due to Low Bidder Count
Dependence on Single Contractor for Critical Infrastructure

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $9.6 million to HALVIK, LLC. NETWORK OPERATIONS SUPPORT (NOS) SERVICES

Who is the contractor on this award?

The obligated recipient is HALVIK, LLC.

Which agency awarded this contract?

Awarding agency: Department of Commerce (U.S. Patent and Trademark Office).

What is the total obligated amount?

The obligated amount is $9.6 million.

What is the period of performance?

Start: 2024-08-08. End: 2027-01-31.

What is Halvik, LLC's past performance record with the federal government, particularly in network operations support?

Assessing Halvik, LLC's past performance is crucial for understanding their capability to fulfill this contract. A review of their federal contract history, including performance evaluations and any past issues or disputes, would provide insight. Agencies typically use past performance information as a key factor in source selection. Without specific data on Halvik's track record in network operations, it's difficult to definitively assess their suitability beyond the fact they were selected in this competition. Further investigation into their award history, contract values, and client feedback would be necessary for a comprehensive evaluation.

How does the $9.5 million contract value compare to similar network operations support contracts awarded by the USPTO or other agencies?

The $9.5 million contract value for approximately 2.5 years of network operations support needs to be benchmarked against comparable contracts. This involves identifying similar IT support services awarded to agencies of similar size and complexity, or within the same sector. Factors such as the scope of services, service level agreements, and contract duration influence pricing. If this contract's average annual cost ($3.8M) is significantly higher or lower than benchmarks, it could indicate either exceptional value or potential overpricing. A detailed comparison requires access to detailed service descriptions and pricing structures of other contracts.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Key risks include potential underperformance by Halvik, LLC, leading to network disruptions for the USPTO. Another risk is vendor lock-in or over-reliance on a single provider. The limited competition (2 bidders) also presents a risk of suboptimal pricing. Mitigation strategies likely involve robust performance monitoring by the USPTO, clearly defined service level agreements (SLAs), and contingency planning for service disruptions. The firm-fixed-price nature helps mitigate cost overrun risks for the government, but performance risks remain. The agency should have processes for addressing contractor deficiencies.

How effective is the 'Full and Open Competition After Exclusion of Sources' approach in ensuring fair pricing and optimal vendor selection?

This contracting approach aims to balance broad competition with specific needs or justifications for excluding certain vendors. Its effectiveness in ensuring fair pricing depends heavily on the reasons for exclusion and the number of remaining eligible bidders. If the exclusions were justified and a sufficient number of capable vendors remained, it could lead to competitive pricing. However, with only two bidders, the competitive pressure might be limited. The transparency of the exclusion rationale is key to assessing fairness. If the exclusions were arbitrary, it could stifle competition and lead to higher costs for taxpayers.

What is the historical spending trend for network operations support at the USPTO over the last five years?

Analyzing historical spending on network operations support at the USPTO provides context for the current $9.5 million award. Understanding whether this contract represents an increase, decrease, or stable level of investment is important. Trends might reveal shifts in IT strategy, increased demand for services, or changes in contracting approaches. For instance, a significant increase in spending could signal new projects or system upgrades, while a decrease might indicate efficiency gains or outsourcing changes. This data helps assess the long-term financial commitment and resource allocation for network operations.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1600 SPRING HILL RD, SUITE 240, VIENNA, VA, 22182

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Economically Disadvantaged Women Owned Small Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $19,744,971

Exercised Options: $9,561,878

Current Obligation: $9,561,878

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 1333BJ21D00280002

IDV Type: IDC

Timeline