DHS awards $116M for ACE/ATAP platform support, raising questions on value and competition

Contract Overview

Contract Amount: $116,369,050 ($116.4M)

Contractor: DEV Technology Group Inc

Awarding Agency: Department of Homeland Security

Start Date: 2025-01-24

End Date: 2026-06-24

Contract Duration: 516 days

Daily Burn Rate: $225.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: INTERIM BRIDGE TASK ORDER AWARD FOR APPLICATION DEVELOPMENT, OPERATION AND MAINTENANCE SUPPORT SERVICES IN SUPPORT OF THE CARGO SERVICES PROGRAM DIRECTORATE FOR ACE AND ATAP PLATFORMS.

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20191

State: Virginia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $116.4 million to DEV TECHNOLOGY GROUP INC for work described as: INTERIM BRIDGE TASK ORDER AWARD FOR APPLICATION DEVELOPMENT, OPERATION AND MAINTENANCE SUPPORT SERVICES IN SUPPORT OF THE CARGO SERVICES PROGRAM DIRECTORATE FOR ACE AND ATAP PLATFORMS. Key points: 1. Contract value of $116.4M over 17 months suggests a high monthly burn rate. 2. Full and open competition was utilized, but the number of bidders is not specified, impacting price discovery assessment. 3. The contract type is Time and Materials, which can present cost control risks if not managed diligently. 4. This award supports critical cargo services platforms, indicating a focus on operational continuity. 5. The contractor, DEV TECHNOLOGY GROUP INC, has a track record that warrants further examination for performance and pricing. 6. Benchmarking against similar IT development and maintenance contracts is crucial for assessing value for money.

Value Assessment

Rating: fair

The contract's value of $116.4 million over approximately 17 months translates to a monthly expenditure of roughly $6.8 million. This rate is substantial and requires careful scrutiny. Without specific details on the scope of work and the labor categories involved, direct comparison to similar contracts is challenging. However, the Time and Materials pricing structure necessitates robust oversight to ensure costs remain reasonable and aligned with the value delivered. The benchmark of $2.26M for similar services suggests this contract may be on the higher end, pending detailed analysis of deliverables.

Cost Per Unit: $2.26M (benchmark for comparable services)

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is generally positive for ensuring a broad range of potential offerors and fostering competitive pricing. However, the absence of information regarding the number of bids received prevents a thorough assessment of the actual level of competition. A low number of bids, even under full and open procedures, could indicate potential market limitations or barriers to entry that might affect price discovery and overall value.

Taxpayer Impact: While full and open competition is intended to benefit taxpayers through competitive pricing, the lack of specific bid counts makes it difficult to quantify the precise savings achieved. Taxpayers benefit most when robust competition drives down costs and improves service quality.

Public Impact

Benefits U.S. Customs and Border Protection (CBP) by ensuring the continued operation and development of critical cargo services platforms. Services delivered include application development, operation, and maintenance support for ACE and ATAP platforms. Geographic impact is national, supporting border security and trade facilitation across the United States. Workforce implications may include the need for specialized IT professionals for development and maintenance, potentially impacting both government and contractor staffing.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type increases risk of cost overruns if not closely monitored.
Lack of specific bid count under 'full and open' competition limits assessment of true market competitiveness.
High monthly burn rate requires diligent performance and cost management.
The interim nature of the award suggests potential for future contract modifications or re-competition, introducing transition risks.

Positive Signals

Awarded under full and open competition, maximizing potential bidder pool.
Supports critical national security and trade facilitation platforms (ACE/ATAP).
Contractor has a significant presence in the federal IT services market.
Clear period of performance with defined end date.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on custom computer programming services. The market for federal IT services is vast and highly competitive, with significant spending allocated to software development, maintenance, and operational support. The U.S. government is a major consumer of these services, with agencies like DHS relying heavily on IT infrastructure for mission-critical functions. Comparable spending benchmarks in this area often vary widely based on complexity, security requirements, and labor rates, but a contract of this magnitude indicates a substantial investment in maintaining and enhancing core operational systems.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of specific small business subcontracting requirements in the provided data. The contractor, DEV TECHNOLOGY GROUP INC, is likely a large business. This means that opportunities for small businesses to participate in this specific contract are limited unless they are part of a subcontracting plan developed by the prime contractor. The absence of a small business set-aside suggests that the procurement focused on capabilities available from a wider range of firms, potentially impacting the distribution of federal dollars within the small business ecosystem for this particular award.

Oversight & Accountability

Oversight for this contract will primarily reside with the U.S. Customs and Border Protection (CBP) contracting officer and their representatives. The Time and Materials (T&M) nature of the award necessitates rigorous monitoring of labor hours, rates, and direct costs to ensure compliance and prevent overspending. Transparency is facilitated through contract award databases, but detailed performance metrics and cost breakdowns are typically internal to the agency. The Department of Homeland Security's Office of Inspector General (OIG) may conduct audits or investigations if specific concerns regarding waste, fraud, or abuse arise.

Related Government Programs

ACE (Automated Commercial Environment)
ATAP (Automated Targeting System - Passenger)
CBP IT Modernization Programs
Federal Civilian IT Services Contracts
Application Development and Maintenance Services

Risk Flags

Potential for cost overruns due to T&M contract type.
Lack of specific bid count under full and open competition.
Interim nature of the award may indicate underlying program instability or transition challenges.
High monthly expenditure requires close monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $116.4 million to DEV TECHNOLOGY GROUP INC. INTERIM BRIDGE TASK ORDER AWARD FOR APPLICATION DEVELOPMENT, OPERATION AND MAINTENANCE SUPPORT SERVICES IN SUPPORT OF THE CARGO SERVICES PROGRAM DIRECTORATE FOR ACE AND ATAP PLATFORMS.

Who is the contractor on this award?

The obligated recipient is DEV TECHNOLOGY GROUP INC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $116.4 million.

What is the period of performance?

Start: 2025-01-24. End: 2026-06-24.

What is the track record of DEV TECHNOLOGY GROUP INC with similar federal contracts, particularly regarding performance and cost overruns?

DEV TECHNOLOGY GROUP INC has a substantial history of securing federal contracts, primarily within the IT services domain. Analysis of their past performance reveals numerous awards across various agencies, including significant work with the Department of Homeland Security. While they generally possess a positive performance record, a deeper dive into specific contract histories is warranted. This includes examining any past instances of cost overruns, schedule delays, or performance deficiencies, as well as any positive feedback or successful project completions. Benchmarking their pricing on previous, comparable contracts against government estimates or industry standards would provide further insight into their cost-competitiveness and value proposition for this current award.

How does the $116.4 million contract value compare to similar IT support contracts awarded by DHS or other agencies for comparable services?

The $116.4 million contract value over 17 months represents a significant investment. To benchmark this effectively, comparisons should be made with contracts for application development, operations, and maintenance of large-scale IT platforms within federal agencies, particularly those with similar complexity and security requirements as CBP's ACE and ATAP systems. The provided benchmark of $2.26M for comparable services suggests this contract may be on the higher end, but this requires context. Factors such as the specific scope of work, the level of technical expertise required, prevailing labor rates in the contract's performance location (Virginia), and the inclusion of any specialized software or hardware components will heavily influence the price. A detailed analysis of the contract's CLIN structure and labor categories is necessary for a precise comparison.

What are the primary risks associated with the Time and Materials (T&M) contract type for this specific award, and what mitigation strategies are in place?

The primary risk with a Time and Materials (T&M) contract is the potential for cost overruns, as the government pays for the actual labor hours and materials used, plus a fixed fee or நிர்ணயிக்கப்பட்ட rate. If not managed diligently, this can lead to costs exceeding initial estimates. For this award supporting critical cargo platforms, risks include scope creep, inefficient labor utilization, and inflated material costs. Mitigation strategies typically involve robust government oversight, including detailed monitoring of timesheets, verification of labor categories and rates, and strict controls on material purchases. Clear definition and enforcement of the Statement of Work (SOW) and regular performance reviews are crucial to ensure the contractor remains focused on efficient delivery and cost control.

What is the expected impact of this contract on the operational effectiveness and modernization efforts of CBP's cargo services programs?

This contract is crucial for the continued operational effectiveness and potential modernization of CBP's cargo services programs, specifically supporting the Automated Commercial Environment (ACE) and Automated Targeting System - Passenger (ATAP) platforms. By providing essential application development, operation, and maintenance support, it ensures the stability and functionality of systems vital for trade facilitation, border security, and revenue collection. The 'interim bridge' nature of the award suggests it may be intended to maintain services while a more permanent or comprehensive solution is developed or competed. Therefore, its impact lies in sustaining current capabilities and potentially enabling incremental improvements or transitions to future iterations of these critical systems.

How has federal spending on IT services for trade facilitation and border security evolved over the past five years, and where does this contract fit within that trend?

Federal spending on IT services for trade facilitation and border security has generally trended upwards over the past five years, driven by the increasing volume of international trade, evolving security threats, and the ongoing need to modernize legacy systems. Agencies like CBP continually invest in platforms like ACE to streamline processes, enhance data analysis, and improve enforcement capabilities. This $116.4 million contract fits within this trend as a significant, albeit potentially interim, investment to ensure the ongoing functionality and support of these vital systems. It reflects the government's commitment to leveraging technology for efficient border management and trade operations, aligning with broader federal initiatives to enhance national security and economic competitiveness through digital transformation.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 11440 COMMERCE PARK DRIVE, RESTON, VA, 20191

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $118,253,402

Exercised Options: $116,369,050

Current Obligation: $116,369,050

Actual Outlays: $33,421,898

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47QTCA19D00JT

IDV Type: FSS

Timeline