Interior Department awards $4.96M for HRD FPPS/WebFPPS software, with no competition

Contract Overview

Contract Amount: $4,965,447 ($5.0M)

Contractor: Software AG, LLC

Awarding Agency: Department of the Interior

Start Date: 2022-03-31

End Date: 2027-03-30

Contract Duration: 1,825 days

Daily Burn Rate: $2.7K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SOFTWARE LICENSES AND MAINTENANCE SERVICES IN SUPPORT OF THE HRD FEDERAL PERSONNEL AND PAYROLL SYSTEM (FPPS) AND WEBFPPS

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20170

State: Virginia Government Spending

Plain-Language Summary

Department of the Interior obligated $5.0 million to SOFTWARE AG, LLC for work described as: SOFTWARE LICENSES AND MAINTENANCE SERVICES IN SUPPORT OF THE HRD FEDERAL PERSONNEL AND PAYROLL SYSTEM (FPPS) AND WEBFPPS Key points: 1. Significant contract value for specialized HR software. 2. Sole-source award limits competitive pricing. 3. Long-term contract (5 years) poses potential risk if needs change. 4. IT services sector, custom programming focus.

Value Assessment

Rating: questionable

The $4.96M contract value over five years for software licenses and maintenance is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to similar government or commercial contracts for HR systems.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was not competed under SAP, indicating a limited competition approach. The lack of open competition likely resulted in higher pricing than if multiple vendors had bid.

Taxpayer Impact: Taxpayer funds are potentially being spent at a non-competitive rate due to the limited competition.

Public Impact

Federal employees' payroll and personnel data management relies on this system. Potential for cost overruns due to lack of competitive pressure. System stability and updates are critical for agency operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Long contract duration
Sole-source award

Positive Signals

Supports critical HR functions
Firm Fixed Price contract type

Sector Analysis

This contract falls within the IT services sector, specifically custom computer programming. Benchmarks for similar federal HR software licenses and maintenance contracts are difficult to ascertain without competitive data, but the value suggests a significant system.

Small Business Impact

The contract data indicates that this award was not made to a small business. There is no indication of small business participation in this specific contract.

Oversight & Accountability

The 'NOT COMPETED UNDER SAP' designation suggests a deviation from standard competitive procurement procedures. Further oversight may be needed to ensure the justification for limited competition was robust.

Related Government Programs

Custom Computer Programming Services
Department of the Interior Contracting
Departmental Offices Programs

Risk Flags

Limited competition
Potential for overpricing
Vendor lock-in
Long-term dependency on a single vendor

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $5.0 million to SOFTWARE AG, LLC. SOFTWARE LICENSES AND MAINTENANCE SERVICES IN SUPPORT OF THE HRD FEDERAL PERSONNEL AND PAYROLL SYSTEM (FPPS) AND WEBFPPS

Who is the contractor on this award?

The obligated recipient is SOFTWARE AG, LLC.

Which agency awarded this contract?

Awarding agency: Department of the Interior (Departmental Offices).

What is the total obligated amount?

The obligated amount is $5.0 million.

What is the period of performance?

Start: 2022-03-31. End: 2027-03-30.

What is the justification for awarding this contract on a limited competition basis?

The justification for limited competition is not provided in the data. Typically, such awards are made when only one source can provide the required supplies or services, or in cases of urgent need. A thorough review of the agency's procurement file would be necessary to understand the specific rationale and ensure it aligns with federal acquisition regulations.

What is the risk associated with a sole-source award for critical HR software?

A sole-source award carries a significant risk of inflated pricing due to the absence of competitive pressure. It also creates vendor lock-in, making it difficult and potentially costly to switch providers in the future. Furthermore, reliance on a single vendor can impact innovation and the ability to leverage market advancements.

How does the firm fixed price contract type mitigate risk for the government?

A Firm Fixed Price (FFP) contract type is generally advantageous for the government as it shifts the risk of cost overruns to the contractor. The contractor is obligated to complete the work for the agreed-upon price, regardless of their actual costs. This provides budget certainty for the government, although it may lead to a higher initial price compared to cost-reimbursement contracts.

Industry Classification

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

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Software AG Government Solutions Inc.

Address: 11951 FREEDOM DR STE 410, RESTON, VA, 20190

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: $4,965,447

Exercised Options: $4,965,447

Current Obligation: $4,965,447

Actual Outlays: $2,967,447

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline