DHS awards $21.3M cloud support contract to Peraton, highlighting need for robust IT infrastructure

Contract Overview

Contract Amount: $21,341,789 ($21.3M)

Contractor: Peraton Technology Services Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2024-08-15

End Date: 2025-09-14

Contract Duration: 395 days

Daily Burn Rate: $54.0K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: TO PROCURE DHS CLOUD ENGINEERING AND OPERATIONS (CEO) SUPPORT.

Place of Performance

Location: SPRINGFIELD, FAIRFAX County, VIRGINIA, 22150

State: Virginia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $21.3 million to PERATON TECHNOLOGY SERVICES INC. for work described as: TO PROCURE DHS CLOUD ENGINEERING AND OPERATIONS (CEO) SUPPORT. Key points: 1. Contract focuses on critical cloud engineering and operations, essential for modern government IT. 2. Awarded via full and open competition, suggesting a competitive bidding process. 3. Delivery order structure indicates a specific, time-bound need within a larger framework. 4. The contract duration of 395 days points to a medium-term operational support requirement. 5. Peraton Technology Services Inc. is the selected contractor, indicating a specific capability match. 6. The NAICS code 518210 points to a market segment focused on data processing and hosting services.

Value Assessment

Rating: good

The contract value of $21.3 million for cloud engineering and operations support appears reasonable given the scope of services typically required for a federal agency like DHS. Benchmarking against similar cloud support contracts would provide a more precise value-for-money assessment. The Time and Materials pricing structure, while common, warrants scrutiny to ensure efficient resource utilization and prevent cost overruns. Without specific performance metrics or detailed cost breakdowns, a definitive value assessment is challenging, but the award to a single entity suggests a considered selection based on perceived capability and price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that all responsible sources were permitted to submit bids. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. The open competition suggests that the agency sought the best value from a wide range of potential providers, rather than restricting the pool.

Taxpayer Impact: A full and open competition is favorable for taxpayers as it maximizes the potential for competitive pricing and encourages a broad range of innovative solutions, ultimately aiming for the best use of public funds.

Public Impact

The Department of Homeland Security (DHS) will benefit from enhanced cloud engineering and operations support. Services delivered will ensure the stability, security, and efficiency of critical DHS cloud infrastructure. The impact is primarily national, supporting the operational capabilities of a key federal agency. Workforce implications may include the need for specialized cloud engineers and operations personnel, potentially both within the contractor's organization and within DHS for oversight.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost creep with Time and Materials pricing if not closely managed.
Dependence on a single contractor for critical cloud operations could pose a risk.
Ensuring adequate knowledge transfer and continuity of operations at contract end.

Positive Signals

Awarded through full and open competition, suggesting a competitive selection process.
Focus on essential cloud engineering and operations addresses a core IT need.
Contract duration provides a stable period for service delivery and infrastructure enhancement.

Sector Analysis

The IT services sector, specifically cloud computing, is a rapidly growing and critical component of federal IT infrastructure. Agencies are increasingly migrating to cloud environments for scalability, flexibility, and cost-efficiency. This contract falls within the domain of cloud infrastructure providers, data processing, and web hosting services, a segment characterized by significant technological advancement and a competitive landscape. Comparable spending benchmarks for cloud support services vary widely based on scope, but federal agencies collectively spend billions annually on such solutions.

Small Business Impact

The provided data indicates that small business participation (sb) is false and there was no small business set-aside (ss) for this contract. This suggests that the procurement was not specifically targeted towards small businesses, and the prime contractor, Peraton Technology Services Inc., is likely a large business. There is no information on subcontracting plans for small businesses, which could be a missed opportunity to engage the small business ecosystem in supporting this critical DHS function.

Oversight & Accountability

Oversight for this contract will likely be managed by the Office of Procurement Operations within DHS, with specific program management residing within the relevant operational units. Accountability measures will be tied to the performance standards outlined in the delivery order and the Time and Materials contract terms. Transparency is facilitated by the public nature of contract awards, though detailed performance data and cost breakdowns may not be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

DHS Cloud Computing Services
Federal Enterprise Architecture
IT Infrastructure Modernization Programs
Cybersecurity Support Services

Risk Flags

Potential for cost overruns with Time and Materials contract.
Vendor lock-in risk.
Dependence on contractor performance for critical IT operations.
Security vulnerabilities in cloud environment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $21.3 million to PERATON TECHNOLOGY SERVICES INC.. TO PROCURE DHS CLOUD ENGINEERING AND OPERATIONS (CEO) SUPPORT.

Who is the contractor on this award?

The obligated recipient is PERATON TECHNOLOGY SERVICES 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 $21.3 million.

What is the period of performance?

Start: 2024-08-15. End: 2025-09-14.

What is Peraton Technology Services Inc.'s track record with DHS and similar cloud support contracts?

Peraton Technology Services Inc. has a history of performing IT services for various government agencies, including DHS. Their experience often spans areas like cloud migration, cybersecurity, and managed IT services. To assess their track record specifically for cloud engineering and operations support, a review of past performance evaluations, contract awards, and any reported issues on similar DHS or other federal contracts would be necessary. This would involve examining their ability to meet performance metrics, manage costs, and deliver services effectively within defined timelines. Without access to detailed past performance data or specific contract history beyond this award, a comprehensive assessment of their track record is limited.

How does the $21.3 million value compare to similar DHS cloud support contracts?

The $21.3 million value for this 395-day delivery order for cloud engineering and operations support needs to be contextualized against similar procurements. DHS, like many large federal agencies, has a substantial cloud footprint, and contracts for its management can range significantly in value. Factors influencing cost include the scope of services (e.g., IaaS, PaaS, SaaS management), the number of cloud environments supported, the complexity of the infrastructure, and the level of security required. A direct comparison would involve identifying contracts with similar service descriptions, durations, and agency components. However, given the critical nature of DHS's mission, a contract of this magnitude for specialized cloud support is not unusual and suggests a significant operational requirement.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks include potential cost overruns due to the Time and Materials (T&M) pricing structure, which requires diligent oversight to ensure efficient labor utilization. Another risk is vendor lock-in or over-reliance on a single provider for critical cloud operations. Performance degradation or security vulnerabilities in the cloud environment also pose significant risks. Mitigation strategies likely involve robust contract management, clearly defined performance work statements (PWS), regular performance reviews, strict adherence to security protocols, and potentially incorporating service level agreements (SLAs) with penalties. The use of full and open competition aims to mitigate risks by selecting a capable vendor, but ongoing monitoring is crucial.

How effective is the 'full and open competition' approach likely to be in ensuring value for taxpayers on this contract?

The 'full and open competition' approach is generally considered the most effective method for ensuring value for taxpayers, as it maximizes the pool of potential bidders, thereby fostering a competitive environment. This competition drives down prices and encourages innovation as contractors vie for the award. For this DHS cloud support contract, it means that multiple companies had the opportunity to propose solutions, likely leading to a more favorable price and service offering than a sole-source or limited competition. However, the ultimate value realized depends on the clarity of the requirements, the effectiveness of the evaluation criteria, and the ongoing contract management to ensure the contractor delivers as promised.

What are the implications of the 'Delivery Order' contract type for DHS and Peraton?

A 'Delivery Order' (DO) is typically issued under an existing indefinite-delivery, indefinite-quantity (IDIQ) contract or a similar multiple-award contract. This implies that DHS likely has a broader contract vehicle in place, and this DO represents a specific task or project within that framework. For DHS, it allows for flexibility in acquiring services as needed, rather than committing to a large, upfront contract. For Peraton, it signifies a defined scope of work, duration, and funding for this particular order. The fact that it's a DO suggests that the underlying IDIQ contract was also likely competed, potentially adding another layer of competition to the overall arrangement.

How does the NAICS code 518210 (Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services) inform our understanding of this contract's scope?

The NAICS code 518210 provides a clear indication of the core services this contract is intended to procure. It encompasses businesses that provide infrastructure for hosting, data processing, and related services. This includes services like cloud computing, data centers, application hosting, and web hosting. Therefore, this contract is focused on the foundational IT infrastructure that enables DHS's digital operations, rather than, for example, software development or end-user IT support. Understanding this code helps frame the expected technical expertise and the criticality of the services being provided to DHS's mission.

Industry Classification

NAICS: Information › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related 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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 70RTAC24R00000023

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

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

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

Financial Breakdown

Contract Ceiling: $24,999,968

Exercised Options: $21,341,789

Current Obligation: $21,341,789

Actual Outlays: $18,867,863

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70RTAC21D00000006

IDV Type: IDC

Timeline