DHS awards $38.6M for cybersecurity architecture, with a significant portion for time and materials

Contract Overview

Contract Amount: $38,577,437 ($38.6M)

Contractor: ZEN Strategics LLC

Awarding Agency: Department of Homeland Security

Start Date: 2023-04-04

End Date: 2024-09-24

Contract Duration: 539 days

Daily Burn Rate: $71.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 13

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: CYBER SECURITY SUPPORT SERVICES (C3S) - ARCHITECTURE FOR THE OFFICE OF INFORMATION TECHNOLOGY (OIT), INFORMATION SECURITY DIVISION (ISD) ON A FIRM-FIXED-PRICE & TIME AND MATERIALS BASIS.

Place of Performance

Location: STEENS, LOWNDES County, MISSISSIPPI, 39766

State: Mississippi Government Spending

Plain-Language Summary

Department of Homeland Security obligated $38.6 million to ZEN STRATEGICS LLC for work described as: CYBER SECURITY SUPPORT SERVICES (C3S) - ARCHITECTURE FOR THE OFFICE OF INFORMATION TECHNOLOGY (OIT), INFORMATION SECURITY DIVISION (ISD) ON A FIRM-FIXED-PRICE & TIME AND MATERIALS BASIS. Key points: 1. Contract focuses on critical cybersecurity architecture for USCIS's Office of Information Technology. 2. A substantial portion of the contract value is allocated to time and materials, which can pose cost control challenges. 3. The contract was awarded under full and open competition, suggesting a robust bidding process. 4. The duration of the contract is approximately 18 months, indicating a need for ongoing support. 5. The award is a delivery order against an existing contract, suggesting a streamlined procurement process. 6. The contractor, Zen Strategics LLC, is tasked with providing essential IT security services.

Value Assessment

Rating: fair

The total award of $38.6 million over approximately 18 months for cybersecurity architecture support appears to be within a reasonable range for complex IT services. However, the significant allocation to Time and Materials (T&M) pricing is a point of concern. While T&M offers flexibility, it lacks the cost certainty of Firm-Fixed-Price (FFP) contracts and requires diligent oversight to prevent cost overruns. Benchmarking the per-unit cost is difficult without detailed labor categories and rates, but the overall value suggests a substantial investment in critical IT security infrastructure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. This approach generally fosters a competitive environment, which can lead to better pricing and service offerings. The presence of 13 bidders suggests a healthy level of interest and competition for this type of cybersecurity support. The agency's decision to use full and open competition is a positive indicator for price discovery and value for taxpayer dollars.

Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down prices through market forces and encouraging innovation among bidders, leading to more cost-effective solutions for government needs.

Public Impact

Citizens and immigrants benefit from enhanced cybersecurity protecting sensitive personal data handled by USCIS. The Office of Information Technology (OIT) and Information Security Division (ISD) receive critical architectural support for their IT infrastructure. The contract supports the operational integrity and security of the U.S. immigration system. Workforce implications include the need for specialized cybersecurity and IT architecture expertise, potentially benefiting skilled professionals in the field.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The significant use of Time and Materials (T&M) pricing introduces potential for cost escalation if not closely monitored.
Lack of specific performance metrics in the provided data makes it difficult to assess the effectiveness of the cybersecurity architecture being developed.
The contract is a delivery order against a larger contract, which might limit the scope for competitive re-evaluation of specific task orders.

Positive Signals

Awarded under full and open competition, ensuring a broad range of potential providers and competitive pricing.
The contract addresses a critical need for cybersecurity architecture, vital for protecting sensitive government and citizen data.
The contractor, Zen Strategics LLC, is tasked with supporting a key division within DHS, indicating a level of trust and capability.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on cybersecurity and IT architecture. The market for cybersecurity services is rapidly growing, driven by increasing cyber threats and the digitization of government operations. Comparable spending benchmarks for cybersecurity architecture support can vary widely based on scope and complexity, but this award represents a significant investment in a critical area for the Department of Homeland Security. The IT services market is highly competitive, with numerous firms offering specialized solutions.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). While the primary award is to Zen Strategics LLC, there is no explicit information on subcontracting plans for small businesses. Without a small business set-aside or clear subcontracting goals, the direct impact on the small business ecosystem for this specific award is likely limited, though the prime contractor may engage small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Homeland Security's contracting officers and the U.S. Citizenship and Immigration Services (USCIS) program managers. The use of Time and Materials pricing necessitates robust oversight to ensure that labor hours and material costs are reasonable and allocable to the contract's objectives. Transparency is enhanced by the public nature of contract awards, but detailed performance reporting and cost tracking mechanisms would be crucial for accountability. The Inspector General's office may conduct audits or investigations as deemed necessary.

Related Government Programs

Cybersecurity Services
IT Architecture Support
Information Security
Custom Computer Programming Services
Department of Homeland Security IT Contracts

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Lack of specific performance metrics in award data.
Need for robust oversight of T&M labor hours and costs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $38.6 million to ZEN STRATEGICS LLC. CYBER SECURITY SUPPORT SERVICES (C3S) - ARCHITECTURE FOR THE OFFICE OF INFORMATION TECHNOLOGY (OIT), INFORMATION SECURITY DIVISION (ISD) ON A FIRM-FIXED-PRICE & TIME AND MATERIALS BASIS.

Who is the contractor on this award?

The obligated recipient is ZEN STRATEGICS LLC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Citizenship and Immigration Services).

What is the total obligated amount?

The obligated amount is $38.6 million.

What is the period of performance?

Start: 2023-04-04. End: 2024-09-24.

What is the track record of Zen Strategics LLC in delivering similar cybersecurity architecture services to federal agencies?

Assessing the track record of Zen Strategics LLC requires a deeper dive into their past performance on federal contracts, particularly those involving cybersecurity architecture and IT security for agencies like DHS or USCIS. Information on past performance, including client satisfaction, adherence to schedule and budget, and technical execution, is typically available through sources like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS). Without direct access to these detailed performance records, it's challenging to definitively evaluate their capabilities for this specific $38.6 million award. However, being awarded a contract of this magnitude suggests they have met certain pre-qualification criteria and demonstrated some level of competence.

How does the Time and Materials (T&M) component of this contract compare to industry benchmarks for similar cybersecurity architecture services?

The Time and Materials (T&M) pricing structure, comprising a significant portion of this $38.6 million award, presents a challenge for direct benchmarking against industry standards without detailed labor categories, rates, and overhead. Generally, T&M contracts are used when the scope of work is not clearly defined or is expected to change, offering flexibility but posing risks of cost overruns. Industry benchmarks for T&M rates in cybersecurity architecture can vary significantly based on the level of expertise required (e.g., senior architects vs. junior analysts), geographic location, and the specific services provided. Government agencies often negotiate T&M rates to be competitive yet cost-effective, but the inherent nature of T&M requires stringent oversight to ensure value for money and prevent scope creep or inefficient labor utilization.

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

The primary risk associated with the Time and Materials (T&M) pricing model in this $38.6 million contract is the potential for cost escalation due to undefined scope or inefficient labor application. Unlike Firm-Fixed-Price (FFP) contracts, T&M does not provide a ceiling on the total cost, making budget predictability difficult. Mitigation strategies typically employed by agencies include establishing a ceiling price, requiring detailed timesheets and justifications for hours worked, conducting regular audits of labor charges and material costs, and implementing strong project management oversight. For this specific contract, the effectiveness of these mitigation strategies will depend on the diligence of the USCIS contracting officers and program managers in monitoring expenditures and ensuring that all work performed is necessary, reasonable, and directly supports the cybersecurity architecture objectives.

How does the $38.6 million award for cybersecurity architecture support compare to historical spending patterns for similar services within DHS or USCIS?

Comparing this $38.6 million award to historical spending patterns requires access to detailed historical contract data for cybersecurity architecture and related IT security services within the Department of Homeland Security (DHS) and U.S. Citizenship and Immigration Services (USCIS). Such analysis would involve examining the frequency, size, and duration of previous contracts for similar services. Without this historical context, it's difficult to definitively state whether this award represents an increase, decrease, or stable level of spending. However, given the increasing threat landscape and the critical nature of cybersecurity, it is plausible that spending in this area is growing across federal agencies. A comprehensive review of past FPDS data would be necessary for a precise comparison.

What specific cybersecurity architecture deliverables are expected under this contract, and how will their success be measured?

The provided data does not specify the exact deliverables for this cybersecurity architecture support contract. Typically, such contracts would involve the development of architectural designs, security frameworks, threat models, implementation plans, and potentially policy recommendations. Measuring the success of these deliverables would likely involve adherence to established cybersecurity standards (e.g., NIST frameworks), successful integration into existing IT systems, positive assessments from independent security reviews or audits, and demonstrable improvements in the security posture of USCIS's IT infrastructure. The effectiveness of the Time and Materials pricing model also hinges on the agency's ability to define clear milestones and performance metrics to ensure the contractor is delivering tangible value.

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 - SECURITY AND COMPLIANCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 70SBUR23Q00000018

Offers Received: 13

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 10693 WATER FALLS LN, VIENNA, VA, 22182

Business Categories: 8(a) Program Participant, Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $75,275,924

Exercised Options: $38,577,437

Current Obligation: $38,577,437

Actual Outlays: $20,507,978

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS35F424DA

IDV Type: FSS

Timeline