VA awards $200K for telecom services in Northern Mariana Islands, raising value-for-money questions

Contract Overview

Contract Amount: $20,023 ($20.0K)

Contractor: Micronesian Telecommunications Corporation

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-05-01

End Date: 2027-04-30

Contract Duration: 729 days

Daily Burn Rate: $27/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FOR LOCAL EXCHANGE CARRIER POTS LINES SERVICES AT THE VAMC SAIPAN, NORTHERN MARIANA ISLANDS

Place of Performance

Location: SAIPAN, SAIPAN County, NORTHERN MARIANA ISLANDS, 96950

Plain-Language Summary

Department of Veterans Affairs obligated $20,023.24 to MICRONESIAN TELECOMMUNICATIONS CORPORATION for work described as: FOR LOCAL EXCHANGE CARRIER POTS LINES SERVICES AT THE VAMC SAIPAN, NORTHERN MARIANA ISLANDS Key points: 1. Contract awarded for essential telecommunications infrastructure to support a VA facility. 2. Limited competition raises concerns about optimal pricing and potential for overpayment. 3. The contract duration of two years suggests a need for ongoing service provision. 4. Geographic isolation of Saipan may contribute to higher service costs. 5. Firm Fixed Price contract type offers cost certainty but limits flexibility. 6. Small business participation is not explicitly detailed in the award notice.

Value Assessment

Rating: questionable

The contract value of $200,032.24 for two years of POTS line services at a single VA facility in Saipan appears high when benchmarked against similar services in more competitive markets. Without competitive bidding, it is difficult to ascertain if this price represents fair market value. The lack of comparison data for the specific region of the Northern Mariana Islands makes a precise value assessment challenging, but the absence of competition is a significant indicator of potential overpayment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under SAP (Simplified Acquisition Procedures), indicating a sole-source or limited competition award. The absence of a competitive process means that multiple vendors were not solicited, and the pricing was likely negotiated directly with Micronesian Telecommunications Corporation. This lack of competition limits the government's ability to leverage market forces to secure the best possible price and service terms.

Taxpayer Impact: Taxpayers may be paying a premium for these services due to the lack of competitive bidding, as the government did not explore alternative offers that could have potentially driven down costs.

Public Impact

Veterans receiving care at the VA Saipan clinic will benefit from reliable telecommunications services. Essential communication infrastructure will be maintained for the VA facility's operations. The Northern Mariana Islands region will see continued telecommunications service provision. Local employment may be supported through the contractor's service delivery.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Limited transparency in the procurement process.
Potential for higher costs due to geographic isolation.
No clear indication of small business subcontracting opportunities.

Positive Signals

Ensures continued essential telecommunications services for a VA facility.
Firm Fixed Price contract provides budget predictability.
Contract awarded to a provider with presumed local presence and capability.

Sector Analysis

This contract falls within the Wired Telecommunications Carriers sector, specifically supporting local exchange carrier services. The market for such services, especially in remote locations like the Northern Mariana Islands, can be characterized by limited providers and potentially higher operational costs. Benchmarking against national averages for POTS lines is difficult due to the unique market dynamics and potential lack of direct competitors in the specific geographic area.

Small Business Impact

The award notice does not indicate any specific small business set-aside provisions for this contract. Furthermore, there is no explicit mention of subcontracting goals for small businesses. This suggests that small businesses may not have been specifically targeted or considered for participation in fulfilling this requirement, potentially limiting their opportunities within this contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting officers and program managers. Accountability measures are inherent in the Firm Fixed Price contract type, which obligates the contractor to deliver specified services at an agreed-upon price. Transparency is limited by the sole-source nature of the award, with public access to detailed justifications for the non-competitive award being restricted.

Related Government Programs

VA Telecommunications Contracts
Wired Telecommunications Services
Federal Contracts in Remote Locations
POTS Line Services

Risk Flags

Lack of Competition
Potential for Overpricing
Limited Transparency
Geographic Isolation Challenges

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $20,023.24 to MICRONESIAN TELECOMMUNICATIONS CORPORATION. FOR LOCAL EXCHANGE CARRIER POTS LINES SERVICES AT THE VAMC SAIPAN, NORTHERN MARIANA ISLANDS

Who is the contractor on this award?

The obligated recipient is MICRONESIAN TELECOMMUNICATIONS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $20,023.24.

What is the period of performance?

Start: 2025-05-01. End: 2027-04-30.

What is the track record of Micronesian Telecommunications Corporation with federal contracts, particularly with the Department of Veterans Affairs?

Information regarding Micronesian Telecommunications Corporation's specific track record with federal contracts, especially with the Department of Veterans Affairs, is not readily available in the provided data. A deeper dive into federal procurement databases like FPDS-NG or SAM.gov would be necessary to assess their past performance, contract values, and any reported issues or successes. Without this historical data, it is difficult to gauge their reliability and experience in fulfilling similar telecommunications requirements for government agencies.

How does the per-line cost of these POTS services compare to similar services in other remote or island territories?

Direct comparison of per-line costs for POTS services in remote or island territories is challenging without specific market data for the Northern Mariana Islands and comparable regions. Typically, services in isolated areas incur higher operational and logistical costs, which can translate to higher prices. However, the absence of competition for this specific contract makes it difficult to determine if the negotiated price reflects these inherent costs or includes a premium due to the lack of bidding. Further research into telecommunications pricing in Guam, American Samoa, or other Pacific islands, considering provider monopolies or duopolies, would be needed for a more robust comparison.

What are the specific risks associated with relying on a sole-source provider for critical telecommunications infrastructure at a VA facility?

Relying on a sole-source provider for critical telecommunications infrastructure introduces several risks. Firstly, there is a significant risk of price escalation in future contract renewals, as the provider faces no competitive pressure to lower costs. Secondly, service quality and responsiveness may decline over time, as the contractor may feel less urgency to address issues when there are no alternative providers. Thirdly, the government has limited leverage in negotiating service level agreements or technological upgrades. Finally, in the event of service disruption or contractor failure, finding and onboarding a replacement provider in a geographically isolated area can be a lengthy and complex process, potentially impacting VA operations and patient care.

What is the historical spending pattern for POTS line services at the VA Saipan clinic?

The provided data does not include historical spending patterns for POTS line services at the VA Saipan clinic. To analyze this, one would need to access historical contract awards for this specific facility or for telecommunications services in the Northern Mariana Islands by the Department of Veterans Affairs over previous fiscal years. Understanding past spending would help determine if the current award represents an increase, decrease, or stable expenditure for these services and identify any trends in contract duration or value.

Are there any alternative telecommunications technologies or providers that could have been considered for this requirement?

Given the sole-source nature of this award, it is unclear if alternative telecommunications technologies or providers were thoroughly investigated. While POTS (Plain Old Telephone Service) lines are a traditional and reliable technology, modern alternatives like VoIP (Voice over Internet Protocol) services, cellular-based communication solutions, or satellite internet could potentially offer more cost-effective or robust options, depending on infrastructure availability in Saipan. The decision to procure POTS lines specifically suggests either a legacy system requirement, a deliberate choice for reliability, or a lack of exploration into newer technologies due to the procurement constraints.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

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

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 36C10A25Q0044

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: TEKKEN ST, SAIPAN, MP, 96950

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

Financial Breakdown

Contract Ceiling: $34,313

Exercised Options: $20,023

Current Obligation: $20,023

Actual Outlays: $13,610

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline