Commerce Department's $3.7M Unify Inc. telephone system maintenance contract awarded without competition

Contract Overview

Contract Amount: $3,720,978 ($3.7M)

Contractor: Unify Inc.

Awarding Agency: Department of Commerce

Start Date: 2022-01-01

End Date: 2026-12-31

Contract Duration: 1,825 days

Daily Burn Rate: $2.0K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: TELEPHONE SYSTEM MAINTENANCE SERVICES

Place of Performance

Location: GAITHERSBURG, MONTGOMERY County, MARYLAND, 20899

State: Maryland Government Spending

Plain-Language Summary

Department of Commerce obligated $3.7 million to UNIFY INC. for work described as: TELEPHONE SYSTEM MAINTENANCE SERVICES Key points: 1. The contract value of $3.72 million over five years suggests a significant investment in maintaining essential communication infrastructure. 2. Awarded to a single vendor, Unify Inc., raises questions about potential lack of competitive pressure on pricing and service. 3. The firm-fixed-price structure aims to control costs, but the absence of competition limits the ability to verify true market value. 4. Performance context is limited without specific metrics on system uptime, response times, or user satisfaction. 5. The contract falls within the IT services sector, specifically focusing on maintenance and repair of communication equipment. 6. The duration of the contract (5 years) indicates a long-term need for these services, potentially locking in the current vendor.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the lack of publicly available comparable contracts for similar telephone system maintenance services, especially those awarded on a sole-source basis. The firm-fixed-price structure provides some cost certainty, but without competitive bids, it's difficult to assess if the $3.72 million represents a fair market price. The absence of competition means there's no direct comparison to gauge value for money against alternative providers or solutions.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the Simplified Acquisition Procedures (SAP), indicating it was likely awarded through a sole-source justification. The absence of a competitive bidding process means that multiple vendors were not given the opportunity to propose their services and pricing. This limits price discovery and potentially leads to higher costs for the government compared to a fully competed contract.

Taxpayer Impact: Taxpayers may be paying a premium for these services due to the lack of competitive pressure. Without a bidding process, there is less incentive for the contractor to offer the most cost-effective solution.

Public Impact

The National Institute of Standards and Technology (NIST) is the primary beneficiary, ensuring the continued operation of its telephone systems. Essential communication services for NIST staff and operations are maintained, supporting daily functions and research activities. The contract's geographic impact is localized to NIST facilities in Maryland. Workforce implications are minimal, as this contract focuses on maintaining existing infrastructure rather than direct employment generation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Potential for vendor lock-in and reduced flexibility in future service procurements.
Limited transparency into the justification for sole-source award.
Absence of performance metrics makes it difficult to assess service quality.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Long-term contract ensures continuity of essential communication services.
Vendor is likely experienced in maintaining the specific telephone systems used.

Sector Analysis

The IT services sector, particularly the maintenance and repair sub-sector for telecommunications equipment, is characterized by specialized knowledge and established vendor relationships. While specific market size data for telephone system maintenance is not readily available, it is a critical component of overall IT infrastructure spending for government agencies. This contract represents a portion of the broader spending on maintaining operational technology, ensuring reliable communication networks are in place.

Small Business Impact

This contract does not appear to have a small business set-aside component, nor is there information suggesting significant subcontracting opportunities for small businesses. The award to Unify Inc. as a sole source likely bypasses the typical avenues for small business participation in federal contracting, potentially limiting their engagement in this specific procurement.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Commerce's contracting officers and the National Institute of Standards and Technology's program managers. Transparency is limited due to the sole-source nature of the award. Accountability measures would be tied to the terms of the firm-fixed-price contract, with potential recourse for non-performance, though specific performance metrics are not detailed here. Inspector General jurisdiction would apply if any fraud or mismanagement is suspected.

Related Government Programs

Federal Telecommunications Services
IT Infrastructure Maintenance
Communication Equipment Repair
Agency-Specific IT Support Contracts

Risk Flags

Sole-source award lacks competitive pricing.
Potential for overpayment due to lack of competition.
Absence of defined performance metrics hinders accountability.
Limited transparency regarding the justification for sole-source procurement.

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $3.7 million to UNIFY INC.. TELEPHONE SYSTEM MAINTENANCE SERVICES

Who is the contractor on this award?

The obligated recipient is UNIFY INC..

Which agency awarded this contract?

Awarding agency: Department of Commerce (National Institute of Standards and Technology).

What is the total obligated amount?

The obligated amount is $3.7 million.

What is the period of performance?

Start: 2022-01-01. End: 2026-12-31.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are awarded when only one responsible source can provide the required supplies or services, often due to unique capabilities, proprietary technology, or urgent and compelling needs. Without this documentation, it is impossible to fully assess the necessity of bypassing the competitive bidding process. Further investigation into the contract file or agency procurement records would be required to understand the rationale behind this decision and whether it aligns with federal acquisition regulations.

How does the annual cost of this contract compare to industry benchmarks for similar services?

Directly comparing the annual cost of $744,195.67 ($3.72M / 5 years) to industry benchmarks for telephone system maintenance is difficult without more specific details about the scope of services, the type and quantity of equipment covered, and the service level agreements. However, given that this contract was awarded sole-source, there is a heightened risk that the pricing may not be as competitive as it would be in a fully competed environment. To perform a robust benchmark, one would need to identify comparable sole-source or competitively awarded contracts for similar-sized organizations or agencies with comparable telecommunication needs and analyze their pricing structures and service inclusions.

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

The provided data does not specify the key performance indicators (KPIs) or service level agreements (SLAs) for this contract. For a maintenance contract of this value and duration, it would be crucial to have defined metrics to ensure service quality and vendor accountability. These typically include response times for service requests, system uptime guarantees, resolution times for issues, and customer satisfaction ratings. The absence of this information in the summary data makes it challenging to assess the expected performance standards and how Unify Inc.'s service delivery will be measured and evaluated throughout the contract period.

Has Unify Inc. previously held similar contracts with the Department of Commerce or other federal agencies, and what was their performance history?

The provided data does not contain information on Unify Inc.'s past performance history with the Department of Commerce or other federal agencies. A thorough assessment of this contract's risk would involve reviewing Unify Inc.'s track record, including any previous contracts for telephone system maintenance or related services. This would typically involve examining past performance evaluations, any contract disputes or terminations, and overall reliability. Without this historical context, it's difficult to gauge the contractor's capability and likelihood of successful performance on this current agreement.

What is the total federal spending on telephone system maintenance services across all agencies, and how does this contract compare?

The provided data focuses solely on this specific contract and does not offer a comprehensive view of total federal spending on telephone system maintenance services across all agencies. To determine this, one would need to query federal procurement databases (like FPDS or USASpending) using relevant Product Service Codes (PSCs) such as 811212 (Computer and Office Machine Repair and Maintenance) or related telecommunications service codes, and filter for maintenance and support contracts. This specific contract of $3.72 million represents a single instance of spending within this category. A broader analysis would reveal the overall scale of federal investment in maintaining communication infrastructure and identify major spending trends or concentrations.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Computer and Office Machine Repair and Maintenance

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

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 1333ND22RNB180002

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Atos SE

Address: 2650 NORTH MILITARY TRL STE 250, BOCA RATON, FL, 33431

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

Financial Breakdown

Contract Ceiling: $3,720,978

Exercised Options: $3,720,978

Current Obligation: $3,720,978

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline