Verizon awarded $102.7M for NGTP system implementation and managed services by the Social Security Administration

Contract Overview

Contract Amount: $102,685,689 ($102.7M)

Contractor: Verizon Business Network Services LLC

Awarding Agency: Social Security Administration

Start Date: 2020-07-20

End Date: 2021-08-26

Contract Duration: 402 days

Daily Burn Rate: $255.4K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: THE PURPOSE OF THIS TASK ORDER IS FOR IMPLEMENTATION SERVICES, INSTALLATION AND TRANSITION, MANAGED SERVICES, REQUIRED HARDWARE AND SOFTWARE, AND, REQUIRED MAINTENANCE TO PROVIDE THE NGTP SYSTEM. THIS TASK ORDER SUPPORTS THE OBJECTIVES OF THE SOC

Place of Performance

Location: BALTIMORE, BALTIMORE CITY County, MARYLAND, 21235

State: Maryland Government Spending

Plain-Language Summary

Social Security Administration obligated $102.7 million to VERIZON BUSINESS NETWORK SERVICES LLC for work described as: THE PURPOSE OF THIS TASK ORDER IS FOR IMPLEMENTATION SERVICES, INSTALLATION AND TRANSITION, MANAGED SERVICES, REQUIRED HARDWARE AND SOFTWARE, AND, REQUIRED MAINTENANCE TO PROVIDE THE NGTP SYSTEM. THIS TASK ORDER SUPPORTS THE OBJECTIVES OF THE SOC Key points: 1. The contract focuses on implementation, installation, transition, managed services, and maintenance for the NGTP system. 2. This task order supports the objectives of the SOC, indicating a critical system for the agency's operations. 3. The contract is a Firm Fixed Price (FFP) type, which shifts cost risk to the contractor. 4. The duration of the contract is 402 days, suggesting a defined project timeline. 5. The award was made under Full and Open Competition, implying a competitive bidding process. 6. The contract was awarded to Verizon Business Network Services LLC, a major telecommunications provider.

Value Assessment

Rating: good

The contract value of $102.7 million for a 402-day period for system implementation and managed services appears reasonable given the scope. Without specific benchmarks for the NGTP system, a direct comparison is difficult. However, for large-scale IT infrastructure and managed services, this price point is within expected ranges for major telecommunications providers. The firm-fixed-price structure suggests that the agency has a clear understanding of the requirements and has negotiated a price that the contractor is expected to adhere to.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition,' indicating that all responsible sources were permitted to submit a bid. This suggests a robust bidding process where multiple companies likely vied for the contract. The level of competition is not explicitly stated in terms of the number of bidders, but the designation implies that the agency sought the best value through a competitive solicitation.

Taxpayer Impact: A full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to lower prices and better service offerings, as contractors strive to win the award.

Public Impact

The primary beneficiaries are the Social Security Administration (SSA) and its employees who will utilize the NGTP system. The services delivered include implementation, installation, transition, managed services, hardware/software provision, and maintenance for the NGTP system. The geographic impact is likely nationwide, supporting the SSA's operational footprint. Workforce implications include potential training for SSA staff on the new system and reliance on Verizon's technical expertise.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with managed services if not carefully managed.
Reliance on a single large vendor for critical system infrastructure.
Ensuring adequate performance metrics and service level agreements (SLAs) are met throughout the contract lifecycle.

Positive Signals

Award to a well-established provider (Verizon) suggests a degree of reliability.
Firm Fixed Price contract structure provides cost certainty for the agency.
Full and open competition indicates potential for competitive pricing and innovation.

Sector Analysis

This contract falls within the Telecommunications and IT Services sector, specifically focusing on network implementation and managed services. The market for such services is large and highly competitive, dominated by major telecommunications and IT solutions providers. The Social Security Administration's spending on critical IT infrastructure like the NGTP system is typical for large federal agencies aiming to modernize and maintain their operational capabilities. Benchmarks for similar large-scale network implementations and managed services contracts can vary widely based on complexity and duration, but a $100M+ contract for a system of this nature is substantial.

Small Business Impact

The provided data indicates that small business participation (sb) was false, and there was no small business set-aside (ss). This suggests that the contract was not specifically targeted towards small businesses, and the prime contractor, Verizon, is a large corporation. There is no information on subcontracting plans for small businesses within this data. Therefore, the direct impact on the small business ecosystem from this specific award appears minimal, though large prime contractors may engage small businesses for specific components or services.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the Social Security Administration. Performance monitoring, adherence to service level agreements, and financial oversight are standard accountability measures. Transparency is usually facilitated through contract award databases and public reporting. The Inspector General's office for the SSA would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Social Security Administration IT Modernization Programs
Federal Civilian Agency Network Infrastructure Contracts
Managed Network Services Contracts
Next Generation Systems Implementation

Risk Flags

Potential for vendor lock-in
Reliance on single vendor for critical infrastructure
Need for robust performance monitoring and SLAs

Frequently Asked Questions

What is this federal contract paying for?

Social Security Administration awarded $102.7 million to VERIZON BUSINESS NETWORK SERVICES LLC. THE PURPOSE OF THIS TASK ORDER IS FOR IMPLEMENTATION SERVICES, INSTALLATION AND TRANSITION, MANAGED SERVICES, REQUIRED HARDWARE AND SOFTWARE, AND, REQUIRED MAINTENANCE TO PROVIDE THE NGTP SYSTEM. THIS TASK ORDER SUPPORTS THE OBJECTIVES OF THE SOC

Who is the contractor on this award?

The obligated recipient is VERIZON BUSINESS NETWORK SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Social Security Administration (Social Security Administration).

What is the total obligated amount?

The obligated amount is $102.7 million.

What is the period of performance?

Start: 2020-07-20. End: 2021-08-26.

What is the specific nature and criticality of the NGTP system for the Social Security Administration?

The provided data indicates the 'NGTP system' is a key focus, with the task order supporting 'the objectives of the SOC.' While the exact acronyms are not fully defined, 'SOC' often refers to a 'System Operations Center' or 'Security Operations Center.' The NGTP system likely represents a critical component of the SSA's operational infrastructure, potentially related to data processing, network management, or service delivery. Its implementation and ongoing managed services suggest it is vital for the agency's ability to perform its core functions, such as processing benefits, managing citizen data, and maintaining secure communication channels. The substantial award value further underscores its importance and complexity.

How does the $102.7 million cost compare to similar large-scale IT implementation and managed services contracts within the federal government?

A $102.7 million contract for a 402-day period for IT implementation and managed services is a significant investment. Benchmarking requires detailed comparison of scope, duration, and specific services. However, for large federal agencies like the SSA, contracts in the tens to hundreds of millions of dollars for complex IT systems and ongoing support are not uncommon. For instance, other agencies procure similar services for enterprise resource planning (ERP) systems, cloud migrations, or large-scale network upgrades. The firm-fixed-price nature suggests a defined scope, which aids in cost comparison. Without specific details on the NGTP system's complexity, it's challenging to provide a precise benchmark, but the value is consistent with major IT procurements for critical national infrastructure.

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

The provided data does not specify the key performance indicators (KPIs) or service level agreements (SLAs) for the managed services. However, for a contract of this nature, typical SLAs would likely include metrics related to system uptime and availability (e.g., 99.9% uptime), network performance (e.g., latency, bandwidth), incident response and resolution times, security compliance, and data integrity. KPIs would be established to measure the contractor's performance against these SLAs, ensuring the NGTP system operates reliably and efficiently. The firm-fixed-price structure implies that meeting these agreed-upon service levels is crucial for the contractor's profitability.

What is Verizon Business Network Services LLC's track record with the Social Security Administration and similar federal agencies for large IT contracts?

Verizon Business Network Services LLC is a major telecommunications and IT services provider with a significant presence in the federal government contracting space. They have a history of performing large-scale network infrastructure, telecommunications, and managed services contracts for various federal agencies. While specific details of their past performance with the SSA for the NGTP system are not provided here, their general track record suggests they possess the technical capabilities and experience required for such a complex undertaking. Agencies typically vet contractors' past performance extensively during the full and open competition process, including reviewing past performance questionnaires and potentially past performance information retrieval systems.

What are the potential risks associated with relying on a single vendor, Verizon, for the implementation and ongoing management of the NGTP system?

Relying on a single vendor like Verizon for the NGTP system introduces several potential risks. One primary concern is vendor lock-in, where the agency becomes heavily dependent on the vendor's proprietary technology, processes, and pricing, making it difficult and costly to switch providers in the future. This can reduce future negotiating leverage. Another risk is the potential for service degradation or disruption if the vendor faces financial difficulties, operational issues, or strategic shifts. Furthermore, a single point of failure could arise if the vendor's personnel or infrastructure supporting the SSA's system experiences an outage or security breach. Mitigating these risks often involves robust contract management, clearly defined exit strategies, and continuous performance monitoring.

How does the $102.7 million spending on this task order fit into the broader context of the Social Security Administration's overall IT budget and spending trends?

The $102.7 million task order represents a significant, but likely specific, investment within the SSA's broader IT budget. Federal agencies like the SSA manage vast IT infrastructures supporting critical national programs, often requiring substantial annual spending on system modernization, maintenance, and new implementations. This particular award focuses on the NGTP system, suggesting a targeted initiative. To understand its place in the broader context, one would need to examine the SSA's total IT budget, historical spending patterns on similar projects, and the agency's strategic IT priorities. This contract could be part of a larger modernization effort or a response to evolving technological needs or security requirements.

Industry Classification

NAICS: Information › Other Telecommunications › All Other Telecommunications

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Verizon Communications Inc

Address: 22001 LOUDOUN COUNTY PKWY, ASHBURN, VA, 20147

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

Financial Breakdown

Contract Ceiling: $102,685,689

Exercised Options: $102,685,689

Current Obligation: $102,685,689

Actual Outlays: $77,627,241

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 28321320D00060007

IDV Type: IDC

Timeline