VA awards $2.16M for HITC data center maintenance, highlighting facilities support services

Contract Overview

Contract Amount: $2,162,149 ($2.2M)

Contractor: HGS Engineering Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2026-01-01

End Date: 2026-12-31

Contract Duration: 364 days

Daily Burn Rate: $5.9K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: HINES INFORMATION TECHNOLOGY CENTER (HITC) FACILITY AND DATA CENTER MAINTENANCE SUPPORT SERVICES

Place of Performance

Location: HINES, COOK County, ILLINOIS, 60141

State: Illinois Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $2.2 million to HGS ENGINEERING INC for work described as: HINES INFORMATION TECHNOLOGY CENTER (HITC) FACILITY AND DATA CENTER MAINTENANCE SUPPORT SERVICES Key points: 1. Contract focuses on essential facilities support for a critical data center. 2. Competition was conducted under Simplified Acquisition Procedures (SAP), suggesting a focus on smaller value procurements. 3. The contract is firm-fixed-price, providing cost certainty for the government. 4. Performance period extends through the end of 2026, indicating a need for sustained support. 5. The award was made via a Blanket Purchase Agreement (BPA) Call, often used for recurring needs. 6. The contractor, HGS Engineering Inc., is responsible for maintaining the Hines Information Technology Center (HITC).

Value Assessment

Rating: good

The contract value of $2.16 million over one year appears reasonable for comprehensive data center facilities maintenance. Benchmarking against similar facilities support contracts for IT infrastructure is challenging without more specific service details. However, the firm-fixed-price structure suggests that the government has negotiated a defined scope and price, which is a positive indicator of value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was competed under Simplified Acquisition Procedures (SAP), which typically involves a limited number of bidders compared to full and open competition. While the exact number of bids received is not detailed, SAP is designed for procurements under a certain dollar threshold, aiming for efficiency. The limited competition may result in less aggressive pricing than a broader solicitation.

Taxpayer Impact: The use of SAP suggests an effort to streamline the procurement process for a moderate-value contract. While potentially less competitive than a full and open bid, it likely balances efficiency with reasonable price discovery for the government.

Public Impact

The Department of Veterans Affairs (VA) benefits from the reliable operation of its Hines Information Technology Center (HITC). Essential facilities maintenance services ensure the uptime and security of critical IT infrastructure. The geographic impact is localized to the HITC facility, likely in Illinois based on the 'IL' state code. The contract supports specialized maintenance roles, potentially impacting the local workforce in facilities management and technical support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited competition under SAP to impact price optimization.
Dependence on a single contractor for critical data center facility maintenance.
Scope creep risk if maintenance needs evolve beyond the initial BPA call parameters.

Positive Signals

Firm-fixed-price contract provides cost predictability.
BPA Call structure allows for efficient ordering of recurring services.
Contract duration through end of 2026 ensures continuity of support.

Sector Analysis

Facilities Support Services (NAICS 561210) is a broad category encompassing a wide range of services for maintaining buildings and infrastructure. This contract specifically targets the maintenance of a data center facility, a critical component of IT infrastructure. Spending in this sector is substantial across government agencies, with significant portions dedicated to maintaining operational facilities that support essential services. Comparable spending benchmarks would depend on the size and complexity of the data center and the specific services required.

Small Business Impact

The data indicates this contract was competed under SAP and awarded as a BPA Call, with no specific small business set-aside mentioned (ss: false, sb: false). This suggests that while small businesses could have bid, there was no explicit requirement to do so. The prime contractor, HGS Engineering Inc., is not specified as a small business. Subcontracting opportunities for small businesses would depend on the prime contractor's strategy and the nature of the services required.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting officers and program managers. As a BPA Call, the specific terms and performance monitoring would be managed within the VA's established procurement and facility management protocols. Transparency is generally maintained through contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

IT Infrastructure Maintenance
Data Center Operations Support
Facilities Management Services
Government IT Services
Department of Veterans Affairs IT Spending

Risk Flags

Limited competition due to SAP
Potential for service disruption if contractor underperforms
Dependence on single contractor for critical infrastructure

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $2.2 million to HGS ENGINEERING INC. HINES INFORMATION TECHNOLOGY CENTER (HITC) FACILITY AND DATA CENTER MAINTENANCE SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is HGS ENGINEERING 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 $2.2 million.

What is the period of performance?

Start: 2026-01-01. End: 2026-12-31.

What is the track record of HGS Engineering Inc. in performing similar facilities support services for government data centers?

Information regarding HGS Engineering Inc.'s specific track record in performing facilities support services for government data centers is not detailed in the provided data. A comprehensive assessment would require reviewing past performance evaluations, contract history, and any reported issues or successes on similar projects. The award of this BPA Call by the Department of Veterans Affairs suggests that the agency has confidence in HGS Engineering Inc.'s capabilities based on prior assessments or existing contract vehicles. Further investigation into their past performance ratings and experience with critical infrastructure maintenance would provide a clearer picture of their reliability and expertise in this specialized area.

How does the $2.16 million contract value compare to similar facilities maintenance contracts for IT centers within the VA or other agencies?

The $2.16 million contract value for one year of facilities and data center maintenance support services for the Hines Information Technology Center (HITC) needs to be contextualized by the scope and scale of the facility. Without detailed service level agreements or facility size, direct comparison is difficult. However, for a single year of comprehensive maintenance for a significant IT center, this amount appears within a reasonable range. Larger, more complex data centers or those requiring highly specialized technical maintenance could command higher annual values, potentially in the tens of millions. Conversely, smaller or less critical facilities might be maintained for less. The firm-fixed-price nature suggests a defined scope, making it a benchmark for similar, clearly defined support packages.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Primary risks include potential service disruptions if the contractor fails to perform adequately, leading to data center downtime. There's also a risk of cost overruns if the firm-fixed-price contract doesn't adequately cover unforeseen maintenance needs, though this is mitigated by the pricing structure. Another risk is the contractor's financial stability or capacity to scale services if requirements change. Mitigation strategies likely involve the VA's contract oversight, performance monitoring, and clear service level agreements (SLAs) within the BPA Call. The firm-fixed-price nature itself is a risk mitigation tool for the government against escalating costs. The VA would also have recourse through contract clauses for non-performance.

How effective is the current contract in ensuring the continuous operation and security of the HITC data center?

The effectiveness of this contract in ensuring continuous operation and security hinges on the contractor's performance and the robustness of the defined service requirements. The award of a one-year contract through a BPA Call suggests a need for ongoing, reliable support. The firm-fixed-price structure aims to incentivize efficient service delivery. However, true effectiveness can only be measured through performance metrics, uptime statistics, and security incident reports related to the HITC facility. Without access to these performance data, it's presumed effective based on the contract award, but ongoing monitoring by the VA is crucial to validate this.

What are the historical spending patterns for facilities maintenance at the HITC or similar VA data centers?

Historical spending patterns for facilities maintenance at the HITC or similar VA data centers are not provided in the current data. To analyze this, one would need to examine past contracts awarded for the HITC or comparable facilities over several fiscal years. This would reveal trends in contract values, duration, types of services procured, and the contractors involved. Understanding historical spending can help identify cost efficiencies, potential increases in service scope or cost, and the stability of support providers. Such analysis is crucial for budgeting, forecasting, and ensuring long-term value for taxpayer money.

What is the potential impact of using Simplified Acquisition Procedures (SAP) on the overall cost-effectiveness for the government?

Using Simplified Acquisition Procedures (SAP) for this $2.16 million contract aims to increase procurement efficiency and reduce administrative burden compared to larger, more complex solicitations. This can lead to faster award times and potentially lower overhead costs associated with the procurement process itself. However, SAP typically involves a smaller pool of potential bidders and may not always achieve the same level of price competition as a full and open solicitation. Therefore, while the process is more efficient, the final price might be slightly higher than what could be achieved through broader competition. The cost-effectiveness is a balance between procurement efficiency and optimal price negotiation.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1121 NOBLE ST, ANNISTON, AL, 36201

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Service Disabled Veteran Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $2,162,149

Exercised Options: $2,162,149

Current Obligation: $2,162,149

Actual Outlays: $163,704

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 36C10X24A0001

IDV Type: BPA

Timeline