State Department awards $14.2M for software services to KAHUA, INC., with 4 bidders

Contract Overview

Contract Amount: $14,243,601 ($14.2M)

Contractor: Kahua, Inc.

Awarding Agency: Department of State

Start Date: 2022-09-28

End Date: 2026-09-28

Contract Duration: 1,461 days

Daily Burn Rate: $9.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: KAHUA PROFESSIONAL AND SOFTWARE SERVICES

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22209

State: Virginia Government Spending

Plain-Language Summary

Department of State obligated $14.2 million to KAHUA, INC. for work described as: KAHUA PROFESSIONAL AND SOFTWARE SERVICES Key points: 1. Contract value of $14.2M over 4 years suggests a moderate annual investment in software solutions. 2. The presence of 4 bidders indicates a reasonably competitive market for these services. 3. Risk indicators are low given the firm-fixed-price contract type, which shifts cost risk to the contractor. 4. Performance context is a delivery order under an existing contract, implying a need for ongoing or expanded services. 5. The contract falls within the Software Publishers sector, a critical area for government IT infrastructure.

Value Assessment

Rating: good

The contract value of $14.2M over approximately four years averages to about $3.56M annually. Benchmarking this against similar software publisher contracts requires more granular data on the specific services provided. However, the firm-fixed-price structure is generally favorable for the government, ensuring cost certainty. The number of bidders (4) suggests a healthy level of competition that likely contributed to a fair price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with four distinct bidders vying for the opportunity. This level of competition is generally considered good, as it allows multiple vendors to present their solutions and pricing, fostering a more dynamic price discovery process. The agency's decision to pursue full and open competition suggests confidence in the market's ability to provide suitable options.

Taxpayer Impact: A competitive award process like this typically benefits taxpayers by driving down prices and encouraging innovation from multiple vendors, leading to better value for the government's investment.

Public Impact

The Department of State is the primary beneficiary, receiving essential software publishing services. This contract supports the operational needs and technological infrastructure of the State Department. The geographic impact is primarily within the United States, where the State Department's operations are managed. Workforce implications may include the need for specialized IT personnel to manage and utilize the software.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if the software is highly specialized and difficult to replace.
Dependence on a single contractor for critical software updates and maintenance could pose a risk.
Ensuring data security and privacy within the software platform is paramount.

Positive Signals

Firm-fixed-price contract type provides cost certainty for the government.
Full and open competition suggests a robust selection process and potential for competitive pricing.
The contract is a delivery order, indicating a structured approach to fulfilling ongoing needs.

Sector Analysis

The Software Publishers industry (NAICS 511210) is a vital sector for government operations, providing the digital tools necessary for administration, communication, and data management. The market size for government IT services is substantial, with agencies increasingly relying on specialized software solutions. This contract fits within the broader trend of government investment in modernizing its IT infrastructure to enhance efficiency and security. Comparable spending benchmarks would depend on the specific type of software and its intended use.

Small Business Impact

There is no indication that this contract included a small business set-aside, nor is there information suggesting significant subcontracting opportunities for small businesses. The award to KAHUA, INC., a single entity, does not inherently signal a direct benefit or impact on the small business ecosystem unless KAHUA itself actively engages small businesses for subcontracting. Further analysis would be needed to determine any indirect effects.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of State's contracting officers and program managers. Accountability measures are inherent in the firm-fixed-price contract, requiring delivery of specified software services. Transparency is generally maintained through contract award databases, though specific performance metrics and detailed spending breakdowns may not always be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of State IT Modernization Programs
Software Licensing and Maintenance Contracts
Cloud Computing Services for Government Agencies
Information Technology Professional Services

Risk Flags

Scope creep potential if requirements are not clearly defined.
Vendor performance and adherence to service level agreements.
Data security and compliance with federal regulations.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $14.2 million to KAHUA, INC.. KAHUA PROFESSIONAL AND SOFTWARE SERVICES

Who is the contractor on this award?

The obligated recipient is KAHUA, INC..

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $14.2 million.

What is the period of performance?

Start: 2022-09-28. End: 2026-09-28.

What is KAHUA, INC.'s track record with the Department of State and other federal agencies?

KAHUA, INC. has a history of providing services to the Department of State, as evidenced by this delivery order. To fully assess their track record, a review of past performance evaluations, any contract disputes, and the scope and value of previous awards would be necessary. Examining their contract history with other federal agencies would provide a broader perspective on their reliability, technical capabilities, and ability to meet government requirements. Information on past performance is often available through sources like the Federal Procurement Data System (FPDS) and contractor performance assessment reporting tools.

How does the $14.2M contract value compare to similar software publishing contracts awarded by the Department of State?

The $14.2M contract value, spread over approximately four years, represents an average annual expenditure of around $3.56M for software services. To benchmark this effectively, one would need to compare it against other contracts for similar software categories (e.g., project management software, collaboration tools, data analytics platforms) awarded by the Department of State or other agencies of comparable size and mission. Factors such as the specific functionalities, user base, and duration of the contract are crucial for a meaningful comparison. Without more specific details on the software's purpose, a precise comparison is challenging, but the amount suggests a significant investment in a core IT capability.

What are the primary risks associated with this firm-fixed-price contract for software services?

The primary risks for the government under a firm-fixed-price (FFP) contract are generally minimal regarding cost overruns, as the price is set. However, risks can emerge if the contract's scope is not clearly defined, potentially leading to disputes over deliverables or change orders. Another risk is that the contractor might reduce quality or service levels to maintain profitability if costs increase unexpectedly. For software services, ensuring the contractor maintains adequate security protocols and provides timely updates and support are critical considerations. The government must also ensure the software meets evolving technological requirements and interoperability standards.

How effective is the full and open competition process in ensuring value for money in this case?

The full and open competition process, with four bidders, is generally effective in promoting value for money. It allows multiple vendors to compete, driving down prices through competitive bidding and encouraging innovation. The Department of State likely benefited from receiving a range of technical solutions and pricing structures. The effectiveness is further enhanced by a clear statement of work and well-defined evaluation criteria, ensuring that the lowest price is not the sole determinant but rather the best overall value. The presence of multiple bidders suggests that the market has sufficient capacity and interest to support the agency's needs competitively.

What are the historical spending patterns for software publishers by the Department of State?

Historical spending patterns for software publishers by the Department of State would reveal trends in IT investment over time. Analyzing past data would show whether spending in this category has been increasing, decreasing, or remaining stable. It would also indicate the typical contract values, durations, and types of software procured. Understanding these patterns helps in forecasting future needs, budgeting, and identifying potential areas for cost savings or strategic sourcing. For instance, a consistent increase in spending might signal a growing reliance on digital tools or a push for modernization, while stable spending could indicate mature IT systems.

What are the implications of this contract award on the broader IT services market for federal agencies?

This award to KAHUA, INC. contributes to the overall spending within the federal IT services market. As a full and open competition, it signals that the Department of State is actively engaging the market for its software needs. The success of KAHUA in winning this contract could influence other agencies' perceptions of the company's capabilities. Furthermore, the specific type of software and services procured can highlight emerging trends or critical needs within government IT. The competitive nature of the award suggests a healthy market dynamic, where multiple vendors are capable of meeting federal requirements, which is generally positive for the government's ability to procure necessary technologies.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 10000 AVALON BLVD STE 600, ALPHARETTA, GA, 30009

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $14,264,450

Exercised Options: $14,243,601

Current Obligation: $14,243,601

Actual Outlays: $2,119,965

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47QTCA19D00CF

IDV Type: FSS

Timeline