DHS awards $8.7M for IT support, raising questions on value and competition

Contract Overview

Contract Amount: $8,735,862 ($8.7M)

Contractor: Guidehouse LLP

Awarding Agency: Department of Homeland Security

Start Date: 2024-09-12

End Date: 2026-03-31

Contract Duration: 565 days

Daily Burn Rate: $15.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: OPERATIONS & MAINTENANCE SUPPORT SERVICES FOR DEPARTMENT OF HOMELAND SECURITY IDENTIFICATION SOLUTION.

Place of Performance

Location: SPRINGFIELD, FAIRFAX County, VIRGINIA, 22150

State: Virginia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $8.7 million to GUIDEHOUSE LLP for work described as: OPERATIONS & MAINTENANCE SUPPORT SERVICES FOR DEPARTMENT OF HOMELAND SECURITY IDENTIFICATION SOLUTION. Key points: 1. Contract value appears moderate for IT support services. 2. Competition dynamics suggest potential for price discovery. 3. Risk indicators are low based on contract type and duration. 4. Performance context is for ongoing IT operations. 5. Sector positioning is within IT services for a federal agency.

Value Assessment

Rating: fair

The contract value of $8.7 million for approximately 1.5 years of IT support services is within a typical range for such engagements. However, without specific details on the scope of work and deliverables, a precise value-for-money assessment is challenging. Benchmarking against similar contracts for IT operations and maintenance support for federal agencies would provide a clearer picture of whether the pricing is competitive. The Time and Materials (T&M) contract type can sometimes lead to cost overruns if not managed closely, which warrants attention.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The data does not specify the number of bidders, but full and open competition generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. The agency's choice of this procurement method suggests a desire to leverage the broadest possible market.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it maximizes the potential for competitive pricing and encourages a wider range of innovative solutions, potentially leading to cost savings and improved service delivery.

Public Impact

The Department of Homeland Security (DHS) will benefit from continued IT support. Services delivered are expected to maintain the functionality of the DHS Identification Solution. The geographic impact is primarily within Virginia, where the agency operates. Workforce implications may include the need for skilled IT professionals to fulfill the contract.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost escalation due to Time and Materials (T&M) contract type if not closely monitored.
Lack of specific performance metrics in the provided data makes it difficult to assess service quality outcomes.
The duration of the contract (approx. 1.5 years) may limit long-term strategic IT planning.

Positive Signals

Awarded under full and open competition, suggesting a robust bidding process.
The contract supports critical IT infrastructure for a major federal agency.
The contractor, GUIDEHOUSE LLP, is a known entity in government contracting.

Sector Analysis

The IT services sector is a significant area of federal spending, encompassing a wide range of support, development, and maintenance activities. This contract falls under computer systems design services, a segment focused on planning and designing computer systems that integrate hardware, software, and communication technologies. Federal spending in this area is consistently high, driven by the need to modernize legacy systems, enhance cybersecurity, and improve operational efficiency across agencies. Comparable spending benchmarks for IT support services can vary widely based on complexity, duration, and specific technologies involved.

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 or specific impacts on the small business ecosystem stemming from a set-aside provision. The prime contractor, GUIDEHOUSE LLP, is likely a large business, and their engagement does not inherently create opportunities for small business participation unless they voluntarily include them in their subcontracting plan.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of Homeland Security's contracting officers and program managers. They are responsible for monitoring contractor performance, ensuring compliance with contract terms, and managing payments. Transparency is facilitated through contract databases like FPDS, where basic award information is publicly available. While specific Inspector General (IG) jurisdiction for this particular contract isn't detailed, the DHS Office of Inspector General (OIG) has broad authority to investigate fraud, waste, and abuse within the department's contracts.

Related Government Programs

DHS IT Modernization Initiatives
Federal Civilian IT Services
Computer Systems Design Services
IT Operations and Maintenance Support

Risk Flags

Potential for cost overruns due to T&M contract type.
Lack of detailed performance metrics.
Limited duration may impact long-term IT strategy.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $8.7 million to GUIDEHOUSE LLP. OPERATIONS & MAINTENANCE SUPPORT SERVICES FOR DEPARTMENT OF HOMELAND SECURITY IDENTIFICATION SOLUTION.

Who is the contractor on this award?

The obligated recipient is GUIDEHOUSE LLP.

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 $8.7 million.

What is the period of performance?

Start: 2024-09-12. End: 2026-03-31.

What is the specific scope of 'OPERATIONS & MAINTENANCE SUPPORT SERVICES FOR DEPARTMENT OF HOMELAND SECURITY IDENTIFICATION SOLUTION'?

The provided data snippet is limited and does not detail the specific tasks included in the 'OPERATIONS & MAINTENANCE SUPPORT SERVICES FOR DEPARTMENT OF HOMELAND SECURITY IDENTIFICATION SOLUTION'. Generally, such services encompass a range of activities necessary to ensure the continuous and effective functioning of an IT system. This can include system monitoring, troubleshooting, software patching and updates, hardware maintenance, user support, performance tuning, and disaster recovery planning. For the DHS Identification Solution, these services are critical for maintaining the integrity and availability of systems used for identification and security purposes. A more detailed statement of work (SOW) or performance work statement (PWS) would be required to fully understand the scope.

How does the $8.7 million contract value compare to similar IT support contracts at DHS or other agencies?

Benchmarking the $8.7 million contract value requires comparing it against similar IT support services contracts, considering factors like duration, complexity, and the specific technologies involved. For a contract spanning approximately 1.5 years (565 days), $8.7 million translates to roughly $5.8 million per year. This figure is moderate for IT operations and maintenance support for a large federal agency like DHS. Contracts for enterprise-level IT support, especially those involving complex systems or significant cybersecurity components, can range from several million to tens or even hundreds of millions of dollars annually. Without knowing the exact deliverables and service levels, it's difficult to definitively state if this represents excellent or questionable value, but it falls within a plausible range for specialized IT support.

What are the potential risks associated with the Time and Materials (T&M) contract type for this service?

The primary risk associated with Time and Materials (T&M) contracts, like the one awarded to GUIDEHOUSE LLP, is the potential for cost overruns. In a T&M contract, the government pays the contractor for the actual labor hours expended and the cost of materials used. If the scope of work is not well-defined, or if the contractor's efficiency is low, costs can escalate beyond initial estimates. This lack of a fixed ceiling on labor hours means the government bears more risk regarding cost control. To mitigate this, robust oversight, detailed tracking of hours and materials, and clear performance expectations are crucial. The relatively short duration of this contract (approx. 1.5 years) might somewhat limit the extent of potential overruns compared to a longer-term T&M engagement.

What does the 'full and open competition' award status imply for the contractor selection and pricing?

An award made under 'full and open competition' signifies that the Department of Homeland Security sought proposals from all responsible sources capable of meeting the contract requirements. This process typically involves publishing a solicitation, allowing any interested and qualified vendor to submit a bid. The implication for contractor selection is that GUIDEHOUSE LLP was chosen from a pool of potentially multiple bidders based on factors such as technical qualifications, past performance, and price. For pricing, full and open competition is generally expected to drive prices down due to market forces, as vendors compete to offer the most attractive terms. This method aims to ensure the government receives the best possible value by leveraging the widest possible market.

How does the NAICS code '541512' (Computer Systems Design Services) define the nature of this contract?

The North American Industry Classification System (NAICS) code 541512, 'Computer Systems Design Services,' categorizes the primary business activity of the contractor. This code encompasses establishments primarily engaged in planning and designing computer systems that integrate hardware, software, and communication technologies. This includes activities such as analyzing and designing IT infrastructure, providing IT consulting services, and implementing information systems. For this DHS contract, it indicates that GUIDEHOUSE LLP is providing services related to the design, integration, and potentially the ongoing management and support of computer systems, specifically the DHS Identification Solution, rather than manufacturing hardware or developing software from scratch.

What is the significance of the contract award type being a 'Delivery Order'?

The contract award type being a 'Delivery Order' (aw: DELIVERY ORDER) indicates that this is not a standalone contract but rather an order placed against an existing indefinite-delivery, indefinite-quantity (IDIQ) contract or a similar type of multiple-award contract vehicle. IDIQ contracts allow agencies to order supplies or services from a pre-established list of contractors over a set period. A delivery order specifies the exact quantity and delivery date for a particular requirement. This method provides flexibility for the agency to procure services as needed, while the underlying IDIQ contract likely underwent a competitive process. The $8.7 million represents the value of this specific order, not necessarily the total value of the parent IDIQ contract.

Industry Classification

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

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 70RDA124Q00000091

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Peraton Technology Services Inc.

Address: 1676 INTERNATIONAL DR STE 800, MCLEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $8,735,862

Exercised Options: $8,735,862

Current Obligation: $8,735,862

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70RDAD23D00000002

IDV Type: IDC

Timeline