SSA awards $38.1M for Next Generation Telephony Services hardware and software to Verizon Business Network Services LLC

Contract Overview

Contract Amount: $38,109,931 ($38.1M)

Contractor: Verizon Business Network Services LLC

Awarding Agency: Social Security Administration

Start Date: 2020-09-30

End Date: 2022-03-30

Contract Duration: 546 days

Daily Burn Rate: $69.8K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: THIS REQUISITION WILL PROCURE HARDWARE AND SOFTWARE FOR THE AGENCY FOR THE NEXT GENERATION TELEPHONY SERVICES PROJECT. THIS HARDWARE AND SOFTWARE WILL SUPPORT THE NGTP CONTRACT FOR THE INTEGRATION OF AUDIO, VIDEO, WEB, DESKTOP, AND MOBILE TELECOM

Place of Performance

Location: BALTIMORE, BALTIMORE CITY County, MARYLAND, 21235

State: Maryland Government Spending

Plain-Language Summary

Social Security Administration obligated $38.1 million to VERIZON BUSINESS NETWORK SERVICES LLC for work described as: THIS REQUISITION WILL PROCURE HARDWARE AND SOFTWARE FOR THE AGENCY FOR THE NEXT GENERATION TELEPHONY SERVICES PROJECT. THIS HARDWARE AND SOFTWARE WILL SUPPORT THE NGTP CONTRACT FOR THE INTEGRATION OF AUDIO, VIDEO, WEB, DESKTOP, AND MOBILE TELECOM Key points: 1. Contract supports the integration of audio, video, web, desktop, and mobile telecommunications. 2. The contract duration is 546 days, indicating a medium-term project. 3. This is a firm-fixed-price contract, which shifts cost risk to the contractor. 4. The award was made under full and open competition. 5. The primary place of performance is Maryland. 6. The contract is for hardware and software procurement.

Value Assessment

Rating: good

The total award amount of $38.1 million for telephony hardware and software over approximately 18 months appears reasonable given the scope of integrating advanced telecommunications services. Benchmarking against similar large-scale IT infrastructure procurements for federal agencies suggests this pricing is within expected ranges. The firm-fixed-price structure provides cost certainty for the agency, although it may limit flexibility if requirements evolve significantly.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This process is designed to foster a competitive environment, potentially leading to better pricing and innovative solutions. The specific number of bidders is not provided, but the 'full and open' designation suggests a robust competition.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down costs through market forces and ensuring the government receives the best value for its investment.

Public Impact

The Social Security Administration (SSA) will benefit from enhanced and integrated telecommunication services. The services delivered will support the agency's Next Generation Telephony Services (NGTP) project. The primary geographic impact is Maryland, where the services will be performed. The procurement of hardware and software will likely involve the telecommunications and IT workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Positive Signals

Awarded under full and open competition, suggesting a competitive bidding process.
Firm-fixed-price contract type provides cost certainty.
Supports a critical agency project for modernizing telecommunications.

Sector Analysis

This contract falls within the Telecommunications sector, specifically focusing on IT infrastructure and services. The market for enterprise-level telecommunications solutions is competitive, with major players offering integrated hardware and software. Federal spending in this area often involves significant investments to modernize legacy systems and enhance communication capabilities across agencies. Comparable spending benchmarks would typically be found in large IT services and network infrastructure contracts.

Small Business Impact

There is no indication that this contract included a small business set-aside. Given the nature of the procurement for advanced telephony hardware and software, it is likely that the prime contractor is a large business. Subcontracting opportunities for small businesses may exist, but are not explicitly detailed in the provided data.

Oversight & Accountability

The Social Security Administration is responsible for the oversight of this contract. As a firm-fixed-price contract, performance monitoring and acceptance of deliverables are key oversight mechanisms. Transparency is generally maintained through federal procurement databases where contract awards are reported. The extent of Inspector General involvement would depend on specific audit triggers or performance issues.

Related Government Programs

Next Generation Telephony Services (NGTP)
Federal IT Infrastructure Modernization
Telecommunications Services Procurement

Risk Flags

Potential for scope creep impacting fixed-price contract
Integration complexity of new telephony systems
Vendor lock-in with proprietary hardware/software
Reliance on a single large vendor for critical infrastructure

Frequently Asked Questions

What is this federal contract paying for?

Social Security Administration awarded $38.1 million to VERIZON BUSINESS NETWORK SERVICES LLC. THIS REQUISITION WILL PROCURE HARDWARE AND SOFTWARE FOR THE AGENCY FOR THE NEXT GENERATION TELEPHONY SERVICES PROJECT. THIS HARDWARE AND SOFTWARE WILL SUPPORT THE NGTP CONTRACT FOR THE INTEGRATION OF AUDIO, VIDEO, WEB, DESKTOP, AND MOBILE TELECOM

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 $38.1 million.

What is the period of performance?

Start: 2020-09-30. End: 2022-03-30.

What is the track record of Verizon Business Network Services LLC with the Social Security Administration?

Verizon Business Network Services LLC has a history of contracting with federal agencies, including the Social Security Administration (SSA). While this specific award is for Next Generation Telephony Services, Verizon is a major telecommunications provider that has secured numerous contracts for network services, voice, and data solutions across the government. A deeper analysis would involve reviewing past performance evaluations, any disputes or claims filed, and the overall satisfaction levels reported by the SSA or other agencies for similar services provided by Verizon. This context is crucial for understanding the contractor's reliability and capability in delivering on this current $38.1 million award.

How does the $38.1 million award compare to historical SSA spending on telephony services?

To assess the $38.1 million award in historical context, one would need to examine the SSA's spending patterns on telephony services over the past several fiscal years. This would involve identifying previous contracts for similar hardware, software, and integration services, noting their award amounts, durations, and the contractors involved. If the SSA has been transitioning to a new telephony system, it's possible that this award represents a significant, one-time investment rather than a recurring annual cost. Comparing this figure to the total IT budget or specific telecommunications line items within the SSA's historical financial records would provide a clearer picture of its relative scale and significance.

What are the primary risks associated with this Next Generation Telephony Services contract?

Key risks for this contract include potential cost overruns if the firm-fixed-price structure doesn't adequately account for unforeseen technical challenges or scope creep, although the risk is primarily on the contractor. There's also a risk of vendor lock-in if the chosen hardware and software are proprietary and difficult to integrate with future systems. Performance risks involve ensuring the reliability and security of the new telephony infrastructure, especially given its critical role in agency operations. Delays in delivery or integration could impact the agency's ability to transition smoothly to the next generation of services. Finally, ensuring the chosen solution meets evolving technological standards and user needs presents an ongoing risk.

How effective is the firm-fixed-price (FFP) contract type in managing costs for this type of IT procurement?

The firm-fixed-price (FFP) contract type is generally effective in managing costs for IT procurements when the scope of work is well-defined and unlikely to change significantly. For this $38.1 million award concerning hardware and software for telephony services, FFP shifts the primary cost risk to the contractor, Verizon Business Network Services LLC. This means the SSA knows the total cost upfront, assuming no contract modifications. However, if unforeseen technical issues arise during integration or if the agency's requirements evolve, the contractor may seek change orders, potentially increasing the total cost. The effectiveness hinges on the initial clarity of requirements and the contractor's ability to execute within the agreed-upon price.

What are the implications of 'full and open competition' for the value received by the SSA?

Full and open competition implies that the SSA solicited bids from all responsible sources capable of meeting the requirements. This process is designed to maximize competition, which typically leads to more competitive pricing, better quality, and a wider range of innovative solutions. For the SSA, this means they likely received proposals from multiple vendors, allowing them to compare technical approaches and costs. The agency could then select the offer that represents the best overall value, not just the lowest price. This competitive environment helps ensure that taxpayer dollars are used efficiently and that the agency obtains a high-quality, cost-effective solution for its Next Generation Telephony Services.

Industry Classification

NAICS: Information › Other Telecommunications › All Other Telecommunications

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

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: $38,109,931

Exercised Options: $38,109,931

Current Obligation: $38,109,931

Actual Outlays: $38,109,931

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 28321320D00060007

IDV Type: IDC

Timeline