DHS awards $8.1M for IT support, with a 43% higher unit cost than benchmark

Contract Overview

Contract Amount: $8,089,431 ($8.1M)

Contractor: Innovative Management Concepts, Inc

Awarding Agency: Department of Homeland Security

Start Date: 2021-08-02

End Date: 2026-09-30

Contract Duration: 1,885 days

Daily Burn Rate: $4.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: CRITICAL INFRASTRUCTURE INFORMATION SHARING ENVIRONMENT SUPPORT SERVICES

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22203

State: Virginia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $8.1 million to INNOVATIVE MANAGEMENT CONCEPTS, INC for work described as: CRITICAL INFRASTRUCTURE INFORMATION SHARING ENVIRONMENT SUPPORT SERVICES Key points: 1. Value for money is questionable due to a significantly higher per-unit cost compared to benchmarks. 2. Competition was full and open, but the number of bidders was not specified. 3. Risk indicators include potential overspending and the need for closer monitoring of performance. 4. Performance context shows a multi-year contract for essential IT support services. 5. Sector positioning is within IT services, a critical area for agency operations.

Value Assessment

Rating: questionable

The contract's per-unit cost is 43% higher than the benchmark for similar computer systems design services. While the total value of $8.1 million over five years is moderate, the elevated unit price suggests potential inefficiencies or a lack of aggressive price negotiation. Further analysis of the specific services rendered and the contractor's overhead is needed to fully justify this cost difference.

Cost Per Unit: $4,291 per unit cost is 43% above the benchmark.

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition after exclusion of sources, indicating an attempt to solicit a broad range of potential bidders. However, the specific number of bids received is not detailed, which limits the assessment of the true competitive landscape. A robust competition typically involves multiple responsive bids to ensure optimal pricing and service.

Taxpayer Impact: While the competition was open, the lack of detail on the number of bidders makes it difficult to ascertain if taxpayers received the best possible value. A more competitive scenario could have driven down costs.

Public Impact

Benefits the Department of Homeland Security by ensuring continued support for critical IT infrastructure. Services delivered include computer systems design and related support, crucial for agency operations. Geographic impact is primarily within the agency's operational centers, likely nationwide. Workforce implications include the potential need for specialized IT personnel to manage and support the systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to high per-unit pricing.
Lack of transparency regarding the number of bidders limits assessment of competition effectiveness.
Contract type (Time and Materials) can sometimes lead to less predictable costs if not managed tightly.

Positive Signals

Awarded through full and open competition, suggesting a broad search for qualified vendors.
Contract duration provides stability for essential IT support services.
Contractor has a track record, though specific performance details are not provided here.

Sector Analysis

This contract falls within the IT services sector, specifically computer systems design. This sector is characterized by rapid technological advancements and a high demand for specialized skills. The market size for federal IT services is substantial, with agencies consistently investing in maintaining and upgrading their technological infrastructure. This contract represents a portion of that ongoing investment.

Small Business Impact

The contract was not set aside for small businesses, and the prime contractor, Innovative Management Concepts, Inc., is not explicitly identified as a small business in the provided data. There is no information on subcontracting plans for small businesses, which could represent a missed opportunity to engage the small business ecosystem.

Oversight & Accountability

Oversight mechanisms would typically involve contract officers, program managers, and potentially the agency's Inspector General. Accountability measures are tied to the delivery of services as per the contract's statement of work and performance standards. Transparency is partially addressed through contract databases, but detailed performance metrics and cost breakdowns are often not publicly available.

Related Government Programs

DHS IT Modernization Programs
Federal Civilian IT Services Contracts
Computer Systems Design Services
Information Technology Support Services

Risk Flags

High per-unit cost compared to benchmark.
Lack of detail on number of bidders.
Potential for cost creep with T&M contract type.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $8.1 million to INNOVATIVE MANAGEMENT CONCEPTS, INC. CRITICAL INFRASTRUCTURE INFORMATION SHARING ENVIRONMENT SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is INNOVATIVE MANAGEMENT CONCEPTS, INC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Office of Procurement Operations).

What is the total obligated amount?

The obligated amount is $8.1 million.

What is the period of performance?

Start: 2021-08-02. End: 2026-09-30.

What is the specific nature of the 'Computer Systems Design Services' provided under this contract?

The contract data indicates 'Computer Systems Design Services' (NAICS code 541512). This typically encompasses a range of activities including analyzing user needs, designing and developing system architecture, integrating hardware and software, and providing technical support for IT systems. For the Department of Homeland Security (DHS), these services likely support critical infrastructure information sharing environments, ensuring the reliability, security, and efficiency of their IT operations. The specific tasks would be detailed in the contract's Statement of Work (SOW), which is not provided here but would outline the precise deliverables and performance standards.

How does the contractor's track record influence the assessment of this contract's value?

The provided data does not include specific details on Innovative Management Concepts, Inc.'s past performance on federal contracts. A thorough assessment of track record would involve reviewing past performance evaluations (e.g., CPARS reports), any history of contract disputes or terminations, and the successful completion of similar projects. Without this information, it's difficult to definitively assess whether the contractor's experience justifies the contract's terms, including the elevated per-unit cost. A strong track record could mitigate some concerns about value, while a poor one would amplify them.

Can the 'Time and Materials' contract type explain the higher per-unit cost compared to benchmarks?

Time and Materials (T&M) contracts, like this one, can sometimes result in higher effective per-unit costs if not managed rigorously, as they reimburse the contractor for direct labor hours at specified rates and for the actual cost of materials. Unlike fixed-price contracts, T&M offers less cost certainty for the government. The benchmark comparison suggests the rates negotiated for labor hours or the overall efficiency might be lower than industry standards for comparable services. While T&M is suitable for projects with undefined scopes, the government must implement strong oversight to control costs and ensure value.

What are the potential risks associated with a multi-year 'Delivery Order' contract for IT support?

Multi-year delivery order contracts for IT support, such as this one, carry several potential risks. Firstly, technology evolves rapidly; a five-year contract might lock the government into outdated systems or services if not structured with flexibility for upgrades. Secondly, the Time and Materials (T&M) pricing structure, as used here, can lead to cost overruns if not closely monitored, potentially exceeding initial budget estimates. Thirdly, reliance on a single contractor for extended periods could reduce leverage for future negotiations or service improvements. Finally, performance degradation over time is a risk that requires continuous monitoring and proactive management.

How does this contract's spending compare to historical DHS spending on similar IT support services?

Without access to historical DHS spending data specifically for 'CRITICAL INFRASTRUCTURE INFORMATION SHARING ENVIRONMENT SUPPORT SERVICES' or comparable IT support contracts, a direct comparison is challenging. However, the total contract value of approximately $8.1 million over roughly five years averages around $1.6 million annually. This figure needs to be contextualized against DHS's overall IT budget and spending trends. If DHS has been increasing its IT support expenditures, this contract might align with that trend. Conversely, if IT support spending has been stable or decreasing, this contract's value might appear higher relative to historical norms.

What oversight mechanisms are in place to ensure the effectiveness and efficiency of these IT support services?

Effective oversight for this contract would involve several layers. The Contracting Officer's Representative (COR) is typically responsible for day-to-day monitoring of contractor performance, ensuring adherence to the Statement of Work (SOW), and approving invoices. Regular performance reviews, progress reports from the contractor, and potentially site visits would be part of this oversight. The agency's procurement office and program managers would also provide oversight. For significant issues or potential fraud, waste, or abuse, the DHS Office of Inspector General (OIG) could initiate audits or investigations.

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 - SECURITY AND COMPLIANCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 70RCSA21R00000010

Offers Received: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 428 HONAKER RD, BLAIRSVILLE, GA, 30512

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

Financial Breakdown

Contract Ceiling: $9,032,224

Exercised Options: $8,873,879

Current Obligation: $8,089,431

Actual Outlays: $5,255,011

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 47QTCH18D0028

IDV Type: GWAC

Timeline