DHS Secret Service awards $22.6M software support contract to Diverse Computing, Inc. without competition

Contract Overview

Contract Amount: $22,560 ($22.6K)

Contractor: Diverse Computing, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2026-02-19

End Date: 2027-02-18

Contract Duration: 364 days

Daily Burn Rate: $62/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SOFTWARE SUPPORT. 2(D).

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20223

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $22,559.99 to DIVERSE COMPUTING, INC. for work described as: SOFTWARE SUPPORT. 2(D). Key points: 1. Contract awarded on a sole-source basis, raising questions about potential cost savings through competition. 2. The contract duration of one year with a firm fixed price suggests a defined scope of work. 3. Software support services are critical for agency operations, but the lack of competition limits price discovery. 4. The award to Diverse Computing, Inc. warrants a review of their past performance and pricing. 5. The contract's value is moderate, but its sole-source nature is a key risk indicator. 6. The absence of small business set-aside or subcontracting requirements may limit broader economic impact.

Value Assessment

Rating: questionable

Without competitive bids, it is difficult to benchmark the value for money on this $22.6 million contract. The firm fixed-price structure provides cost certainty for the government, but the lack of competition means the Secret Service may not be receiving the most advantageous pricing available in the market. A comparison to similar software support contracts, especially those competed openly, would be necessary to assess if the pricing is fair and reasonable.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This indicates that the U.S. Secret Service likely identified a specific need that only Diverse Computing, Inc. could fulfill, or that circumstances did not allow for a competitive process. The lack of multiple bidders means there was no opportunity for price negotiation or discovery through market forces.

Taxpayer Impact: Taxpayers may be paying a premium for this software support due to the absence of competitive pressure to drive down costs. The government's ability to secure the best possible price is diminished in sole-source procurements.

Public Impact

The U.S. Secret Service is the primary beneficiary, receiving essential software support to maintain its operational capabilities. Services delivered include ongoing support for software critical to the agency's protective and investigative missions. The geographic impact is concentrated in Washington D.C., where the agency's headquarters are located. The contract supports the workforce by ensuring the tools they rely on are functional and maintained.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential taxpayer savings.
Lack of transparency in the justification for sole-source award.
No indication of performance metrics or service level agreements in the provided data.
Potential for vendor lock-in given the specialized nature of software support.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Defined contract duration (one year) allows for periodic reassessment of needs.
Award to a single vendor can streamline management and communication.

Sector Analysis

This contract falls within the software publishers and support services sector, a critical component of the IT industry. The market for specialized software support is often characterized by a mix of large enterprise solutions and niche providers catering to specific agency needs. While the overall IT market is vast, contracts for unique or legacy system support can sometimes lead to sole-source awards due to specialized knowledge requirements. Benchmarking would ideally involve comparing pricing for similar support services across government agencies or within the private sector for comparable software.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses, nor is there information suggesting subcontracting opportunities for small businesses. This means the full value of the contract is likely to be realized by Diverse Computing, Inc. without direct benefit to the small business ecosystem through subcontracting. Further investigation into the contractor's own small business utilization plan would be needed to assess any indirect impact.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Homeland Security's contracting and program management offices. The U.S. Secret Service would be responsible for monitoring performance and ensuring adherence to the contract terms. Transparency is limited by the sole-source nature of the award; however, contract award data is typically available through federal procurement databases. Inspector General jurisdiction would apply if any issues of fraud, waste, or abuse arise.

Related Government Programs

Department of Homeland Security IT Services
U.S. Secret Service Operational Support
Federal Software Maintenance Contracts
Sole-Source IT Procurements

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for non-competitive pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $22,559.99 to DIVERSE COMPUTING, INC.. SOFTWARE SUPPORT. 2(D).

Who is the contractor on this award?

The obligated recipient is DIVERSE COMPUTING, INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Secret Service).

What is the total obligated amount?

The obligated amount is $22,559.99.

What is the period of performance?

Start: 2026-02-19. End: 2027-02-18.

What is the track record of Diverse Computing, Inc. with federal contracts, particularly regarding software support?

A review of Diverse Computing, Inc.'s federal contract history is essential to assess their performance and reliability. Key areas to examine include past contract values, duration, agencies served, and any reported performance issues or awards. Understanding their experience with similar software support services, especially for agencies with critical missions like the Secret Service, will provide context for this current award. Information on past contract modifications, overruns, or terminations could also indicate potential risks. Without specific data on their past performance, it is difficult to definitively assess their suitability beyond the agency's internal assessment that led to the sole-source award.

How does the pricing of this contract compare to similar software support services procured competitively?

Direct comparison of pricing is challenging due to the sole-source nature of this award. To benchmark effectively, one would need to identify comparable contracts for similar software support services that were awarded competitively. This would involve looking at contracts with similar scope, duration, and complexity across different federal agencies. Factors such as the specific software being supported, the level of support required (e.g., 24/7 vs. business hours), and the vendor's overhead and profit margins would need to be considered. If competitive contracts show significantly lower per-unit costs or overall contract values for similar services, it would suggest that this sole-source award may not represent the best value for taxpayers.

What are the specific risks associated with awarding a software support contract on a sole-source basis?

The primary risk of a sole-source award is the lack of price competition, which can lead to inflated costs for the government. Taxpayers may end up paying more than necessary because there is no market pressure to drive down prices. Another risk is reduced innovation, as the incumbent contractor may have less incentive to improve services or offer cost-saving solutions. Furthermore, sole-source awards can sometimes indicate a lack of adequate market research or planning by the agency. There's also a risk of vendor lock-in, where the agency becomes overly reliant on a single provider, making it difficult and costly to switch vendors in the future, even if performance or pricing becomes unsatisfactory.

What is the justification provided by the Department of Homeland Security for awarding this contract without competition?

The provided data states the contract was 'NOT COMPETED' and awarded as a 'PURCHASE ORDER'. Typically, agencies must justify sole-source awards through specific circumstances outlined in federal acquisition regulations (FAR). Common justifications include: only one responsible source exists to meet the requirement, an urgent need prevents competition, or the award is made under specific statutory authority. Without the agency's formal justification document (e.g., a Justification and Approval - J&A), it is impossible to know the precise reason. This justification is crucial for understanding the necessity of the sole-source approach and for assessing its validity.

What is the potential impact of this contract on the overall IT services market for federal agencies?

This specific contract, valued at $22.6 million for one year, represents a moderate-sized award within the broader federal IT services market. Its sole-source nature, however, highlights a common challenge in procuring specialized support for unique or legacy systems. While it doesn't significantly alter the overall market dynamics, it underscores the importance of effective market research and strategic sourcing to maximize competition where possible. For agencies, it reinforces the need to plan procurements well in advance to allow for competitive processes. For vendors, it indicates that niche expertise or established relationships can lead to sole-source opportunities, though competitive bids generally offer greater market access.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: SERVICE AND TRADE EQPT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3717 APALACHEE PKWY, TALLAHASSEE, FL, 32311

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

Financial Breakdown

Contract Ceiling: $119,774

Exercised Options: $22,560

Current Obligation: $22,560

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline