GSA's $172.8M WWHWSW II Contract with Peraton for IT Services Shows Concerns in Competition and Value

Contract Overview

Contract Amount: $172,777,864 ($172.8M)

Contractor: Peraton Enterprise Solutions LLC

Awarding Agency: General Services Administration

Start Date: 2018-09-17

End Date: 2020-09-16

Contract Duration: 730 days

Daily Burn Rate: $236.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: WORLDWIDE COTS HARDWARE SOFTWARE MAINTENANCE AND INTEGRATION SERVICES II (WWHWSW II)

Place of Performance

Location: SEASIDE, MONTEREY County, CALIFORNIA, 93955

State: California Government Spending

Plain-Language Summary

General Services Administration obligated $172.8 million to PERATON ENTERPRISE SOLUTIONS LLC for work described as: WORLDWIDE COTS HARDWARE SOFTWARE MAINTENANCE AND INTEGRATION SERVICES II (WWHWSW II) Key points: 1. The contract value of $172.8M for IT services is significant, requiring careful scrutiny. 2. Peraton Enterprise Solutions LLC is the sole awardee, raising questions about competition. 3. The contract's duration and fixed-price nature present potential risks and opportunities. 4. Computer Systems Design Services (NAICS 541512) is a broad category, making direct sector benchmarks challenging.

Value Assessment

Rating: questionable

The contract's total value of $172.8M over two years suggests a high per-year spend. Without specific task order details or comparable contract data, assessing the pricing against similar IT integration services is difficult. The benchmark of $23,668,200 per year is high.

Cost Per Unit: $23,668,200

Competition Analysis

Competition Level: full-and-open

Although listed as 'Full and Open Competition,' the award to a single entity, Peraton Enterprise Solutions LLC, suggests potential issues in the bidding process or that only one viable offer was received. This limits price discovery and potentially reduces competitive pressure.

Taxpayer Impact: The impact on taxpayers is uncertain. While full and open competition aims for best value, a single awardee may not guarantee the lowest possible price.

Public Impact

Federal agencies rely on IT hardware, software, and integration services for critical operations. The contract supports essential IT infrastructure, impacting government efficiency and service delivery. The significant value indicates a substantial investment in maintaining and upgrading federal IT systems. The specific services procured could range from cybersecurity to network management, affecting various government functions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition despite 'Full and Open' status
High annual spending without clear value justification
Potential for vendor lock-in with a single awardee

Positive Signals

Contract awarded under a competitive process
Fixed-price contract type can control costs if well-defined
Supports essential IT infrastructure needs

Sector Analysis

This contract falls under IT services, specifically Computer Systems Design Services. Spending in this sector is consistently high across government, driven by the need for modernization, cybersecurity, and operational efficiency. Benchmarks vary widely based on service type and complexity.

Small Business Impact

The data indicates this contract did not involve small businesses (ss: false, sb: false). This suggests the scope or requirements were likely geared towards larger prime contractors capable of handling complex IT integration and maintenance services.

Oversight & Accountability

The General Services Administration (GSA) manages this contract through its Federal Acquisition Service. Oversight would involve monitoring Peraton's performance, adherence to contract terms, and ensuring delivery of required IT services within the agreed-upon budget and schedule.

Related Government Programs

Computer Systems Design Services
General Services Administration Contracting
Federal Acquisition Service Programs

Risk Flags

Potential lack of true competition
High annual spending requires justification
Risk of vendor lock-in
Limited transparency on specific services and pricing

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $172.8 million to PERATON ENTERPRISE SOLUTIONS LLC. WORLDWIDE COTS HARDWARE SOFTWARE MAINTENANCE AND INTEGRATION SERVICES II (WWHWSW II)

Who is the contractor on this award?

The obligated recipient is PERATON ENTERPRISE SOLUTIONS LLC.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $172.8 million.

What is the period of performance?

Start: 2018-09-17. End: 2020-09-16.

What specific IT integration services were procured under this contract, and how do their costs compare to industry standards for similar tasks?

The contract covers 'Computer Systems Design Services,' a broad category including hardware, software maintenance, and integration. Without detailed task orders, a precise cost comparison is impossible. However, the annual average spend of $23.7M is substantial, suggesting complex or large-scale integration projects. Further analysis would require examining specific deliverables and comparing them against market rates for similar IT solutions.

Given the award to a single vendor, what mechanisms were in place to ensure competitive pricing and prevent potential cost overruns?

While listed as 'Full and Open Competition,' the single awardee raises concerns. Mechanisms to ensure competitive pricing might have included stringent evaluation criteria, robust cost realism analyses, and potentially pre-negotiated rates. However, the lack of direct competition post-award limits ongoing price discovery. Oversight would be critical to monitor performance and prevent scope creep that could inflate costs.

How effectively did this contract support the government's IT modernization and operational needs over its two-year term?

The contract's effectiveness hinges on the successful delivery of hardware, software maintenance, and integration services by Peraton. Its two-year duration suggests it addressed immediate or medium-term IT needs. Evaluating effectiveness would require assessing system performance, user satisfaction, and whether the procured services contributed to improved government IT infrastructure and operational capabilities.

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 › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: ID03180024

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 15050 CONFERENCE CENTER DR, CHANTILLY, VA, 20151

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $220,771,771

Exercised Options: $178,760,879

Current Obligation: $172,777,864

Actual Outlays: $195,402

Subaward Activity

Number of Subawards: 350

Total Subaward Amount: $1,217,539,200

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS00Q09BGD0027

IDV Type: GWAC

Timeline