VA awards $125M contract for Technology Incubation Services 2.0 to Salient CRGT, Inc

Contract Overview

Contract Amount: $125,389,538 ($125.4M)

Contractor: Salient Crgt, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-07-25

End Date: 2026-09-24

Contract Duration: 791 days

Daily Burn Rate: $158.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: TECHNOLOGY INCUBATION SERVICES 2.0

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22033

State: Virginia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $125.4 million to SALIENT CRGT, INC. for work described as: TECHNOLOGY INCUBATION SERVICES 2.0 Key points: 1. Contract aims to enhance technology incubation services for the VA. 2. Salient CRGT, Inc. is the primary contractor for this initiative. 3. The contract duration extends through September 2026. 4. This award falls under computer systems design services. 5. The contract type is Time and Materials, indicating flexibility in scope. 6. The award was made under full and open competition.

Value Assessment

Rating: good

The contract value of $125.4 million over approximately 2.6 years suggests a significant investment in technology incubation. Benchmarking against similar IT service contracts requires detailed analysis of scope and deliverables, but the award to a single entity implies a focused approach. The Time and Materials pricing model allows for adaptability but necessitates careful monitoring to ensure cost-effectiveness and prevent scope creep. Further analysis of the specific services rendered will be crucial for a comprehensive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of 3 bidders suggests a moderate level of competition for this specific requirement. While not an extremely high number of bidders, full and open competition generally promotes price discovery and allows the government to select the best value offering.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it encourages a competitive bidding process, which typically leads to more favorable pricing and a wider range of innovative solutions being considered.

Public Impact

Veterans will benefit from improved technology services and potentially new digital solutions. The contract supports the Department of Veterans Affairs' mission to provide modern IT infrastructure. Services are likely to be delivered across various VA facilities and potentially remotely. This contract may support a workforce skilled in computer systems design and technology incubation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials (T&M) contract type can lead to cost overruns if not closely managed.
The specific deliverables and success metrics for 'Technology Incubation Services 2.0' need clear definition to ensure performance.
Dependence on a single contractor for a critical service area warrants ongoing performance monitoring.

Positive Signals

Awarded under full and open competition, suggesting a competitive process.
The contract duration allows for sustained development and implementation of incubation services.
The contractor, Salient CRGT, Inc., likely has relevant experience in IT services for government agencies.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on computer systems design and related services. The market for technology incubation and IT modernization within government agencies is substantial, driven by the need to upgrade legacy systems and adopt new digital solutions. Comparable spending benchmarks would involve analyzing other large IT service contracts awarded by the VA and other federal agencies for similar scope and duration.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. However, the prime contractor, Salient CRGT, Inc., may choose to subcontract portions of the work to small businesses as part of their overall business strategy, which could indirectly benefit the small business ecosystem.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of Veterans Affairs contracting officers and program managers. Accountability measures will be tied to the performance metrics and deliverables outlined in the contract. Transparency is facilitated by the public nature of federal contract awards, though specific details of service delivery and performance may be internal. The Inspector General's office for the VA would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

VA IT Modernization Programs
Federal Cloud Computing Strategy
Digital Services for Federal Agencies
IT Professional Services Contracts

Risk Flags

Potential for cost overruns due to Time and Materials pricing model.
Need for clear definition and tracking of deliverables for technology incubation.
Ensuring effective knowledge transfer and avoiding vendor lock-in.
Performance monitoring of contractor's ability to innovate and deliver.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $125.4 million to SALIENT CRGT, INC.. TECHNOLOGY INCUBATION SERVICES 2.0

Who is the contractor on this award?

The obligated recipient is SALIENT CRGT, INC..

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 $125.4 million.

What is the period of performance?

Start: 2024-07-25. End: 2026-09-24.

What is Salient CRGT, Inc.'s track record with the Department of Veterans Affairs and similar technology incubation contracts?

Salient CRGT, Inc. has a history of performing IT services for the Department of Veterans Affairs. While specific details on their past performance on 'technology incubation' projects are not provided in this summary, their experience with the VA suggests familiarity with the agency's operational environment and IT needs. A deeper dive into their contract history with the VA, including past performance reviews and any awards or penalties, would provide a clearer picture of their capabilities and reliability in delivering complex IT solutions. Their broader portfolio likely includes various IT modernization, system integration, and software development services, which are foundational to technology incubation.

How does the $125.4 million contract value compare to similar technology incubation or IT modernization efforts within the federal government?

The $125.4 million contract value for Technology Incubation Services 2.0 is a significant investment, placing it in the mid-to-large tier for federal IT service contracts. To benchmark effectively, one would compare it against other large-scale IT modernization, digital transformation, or specialized technology development contracts awarded by agencies like the VA, DoD, or HHS. For instance, contracts focused on cloud migration, data analytics platforms, or cybersecurity enhancements often fall within this spending range. The 'incubation' aspect suggests a focus on developing and testing new technologies, which can be more variable in cost than standard IT support. Without specific details on the scope and deliverables, a precise comparison is difficult, but the amount indicates a substantial commitment to advancing the VA's technological capabilities.

What are the primary risks associated with a Time and Materials (T&M) contract of this magnitude for technology incubation services?

The primary risk with a Time and Materials (T&M) contract of this magnitude, especially for services like technology incubation where the scope can evolve, is the potential for cost overruns. Unlike fixed-price contracts, T&M contracts pay the contractor for the actual time and materials used. If not managed rigorously with clear task orders, well-defined ceilings, and diligent oversight, the total cost can exceed initial estimates. For technology incubation, this risk is amplified as the path to innovation can be unpredictable. Ensuring that the VA has strong project management, detailed tracking of hours and resources, and robust change control processes is crucial to mitigate the risk of uncontrolled spending and to ensure the project delivers value within budget.

What are the expected program effectiveness metrics for 'Technology Incubation Services 2.0'?

While specific program effectiveness metrics are not detailed in the provided data, for a 'Technology Incubation Services 2.0' contract, typical metrics would likely focus on the successful development, testing, and potential pilot deployment of new technologies. This could include the number of innovative solutions identified and prototyped, the speed at which prototypes are developed, the successful integration of new technologies into existing VA systems, user adoption rates of incubated technologies, and the achievement of specific performance improvements or cost savings resulting from these new technologies. Metrics related to contractor performance, such as meeting milestones, staying within budget ceilings (for T&M), and responsiveness to VA requirements, would also be critical.

How has VA spending on computer systems design services (NAICS 541512) trended over the past five years, and how does this award fit into that pattern?

The VA's spending on computer systems design services (NAICS 541512) has generally been substantial and has likely seen an upward trend as the agency prioritizes IT modernization and digital transformation. This $125.4 million award for Technology Incubation Services 2.0 represents a significant single contract within this category. It aligns with broader federal initiatives to enhance IT capabilities and improve service delivery through technology. Analyzing historical VA spending data for NAICS 541512 would reveal the overall investment in this area, allowing us to assess whether this contract is an outlier, a continuation of a trend, or a strategic increase in focus on innovation and system design.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 4000 LEGATO RD STE 600, FAIRFAX, VA, 22033

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

Financial Breakdown

Contract Ceiling: $319,569,675

Exercised Options: $125,389,538

Current Obligation: $125,389,538

Actual Outlays: $67,439,888

Subaward Activity

Number of Subawards: 31

Total Subaward Amount: $38,211,781

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47QTCK18D0060

IDV Type: GWAC

Timeline