DHS awards $2.8M for IT support, raising questions on value and competition

Contract Overview

Contract Amount: $2,828,073 ($2.8M)

Contractor: Countertrade Products, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2023-04-12

End Date: 2028-04-11

Contract Duration: 1,826 days

Daily Burn Rate: $1.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: MICROSOFT UNIFIED SUPPORT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20024

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $2.8 million to COUNTERTRADE PRODUCTS, INC. for work described as: MICROSOFT UNIFIED SUPPORT SERVICES Key points: 1. Contract value appears moderate for IT support services. 2. Competition was limited, potentially impacting price discovery. 3. Performance period is substantial, requiring ongoing oversight. 4. Contract type is firm-fixed-price, offering cost certainty. 5. The specific services are categorized under 'Other Computer Related Services'. 6. Oversight is provided by the Office of the Inspector General.

Value Assessment

Rating: fair

The contract value of $2.8 million for a five-year period for IT support services is within a reasonable range for similar government contracts. However, without specific details on the scope of services and the number of hours or deliverables, a precise value-for-money assessment is challenging. Benchmarking against industry standards for IT support in the federal sector would require more granular data on service levels and resource allocation. The firm-fixed-price structure suggests an attempt to control costs, but the ultimate value depends on the efficiency and effectiveness of the services provided.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating that while a broad competition was intended, specific sources were excluded. The data shows two bids were received. This level of competition, while not a sole-source award, is less robust than full and open competition with multiple bidders, which could potentially lead to less aggressive pricing. The exclusion of certain sources warrants further investigation into the justification for their exclusion.

Taxpayer Impact: Limited competition may result in higher costs for taxpayers compared to a scenario with more bidders vying for the contract.

Public Impact

The Department of Homeland Security benefits from IT support services. Services are expected to maintain and enhance IT infrastructure. The contract is geographically focused on the District of Columbia. Workforce implications are likely within the IT support domain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about potential price inflation.
The justification for excluding certain sources needs to be clearly understood to ensure fairness.
The long performance period requires diligent monitoring to ensure continued value.

Positive Signals

Firm-fixed-price contract provides cost predictability.
Oversight by the Office of the Inspector General suggests a focus on accountability.
The contract falls under a broad IT services category, allowing for flexibility.

Sector Analysis

The IT services sector within the federal government is vast, encompassing a wide range of support, development, and maintenance activities. This contract for 'Other Computer Related Services' fits within the broader IT support and maintenance sub-sector. Federal spending in this area is consistently high, driven by the need to maintain aging systems and adopt new technologies. Comparable spending benchmarks would typically look at the average cost per hour for IT support specialists or the total contract value for similar service scopes across agencies.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. Given the nature of IT support services, it's possible that larger prime contractors may engage small businesses for specialized tasks, but this is not explicitly stated. Further analysis would be needed to determine the extent of small business participation.

Oversight & Accountability

The Office of the Inspector General (OIG) for the Department of Homeland Security is responsible for overseeing this contract. The OIG conducts audits and investigations to ensure the integrity and efficiency of DHS programs and operations. Transparency is facilitated through public contract databases, but detailed performance metrics and spending breakdowns may not be readily available to the public.

Related Government Programs

IT Professional Services
IT Operations and Maintenance
Computer Systems Design Services

Risk Flags

Limited competition
Unclear scope of services
Potential for cost overruns if scope is not well-defined

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $2.8 million to COUNTERTRADE PRODUCTS, INC.. MICROSOFT UNIFIED SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is COUNTERTRADE PRODUCTS, INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Office of the Inspector General).

What is the total obligated amount?

The obligated amount is $2.8 million.

What is the period of performance?

Start: 2023-04-12. End: 2028-04-11.

What is the specific scope of 'Other Computer Related Services' covered under this contract?

The specific scope of 'Other Computer Related Services' under contract number 541519 is not detailed in the provided data. This classification typically encompasses a broad range of IT services that do not fit neatly into more specific categories like software development or network administration. It could include activities such as IT system analysis, IT consulting, IT project management, IT disaster recovery services, and IT system integration. For a precise understanding, one would need to consult the detailed Statement of Work (SOW) or Performance Work Statement (PWS) associated with this specific contract award.

What was the justification for excluding certain sources in the competition?

The provided data indicates the contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This procurement method suggests that while the competition was intended to be open, specific sources were deliberately excluded. The justification for such exclusions typically stems from reasons like national security, proprietary technology, or specific capabilities that only a limited number of entities possess. Without access to the contract's justification for other than full and open competition (JOFOC) document, the precise reasons for excluding sources remain unknown. This exclusion warrants scrutiny to ensure it was based on legitimate and well-documented requirements and did not unduly restrict competition.

How does the $2.8 million contract value compare to similar IT support contracts awarded by DHS?

Comparing the $2.8 million contract value for five years of IT support services requires benchmarking against similar contracts awarded by the Department of Homeland Security (DHS) or other federal agencies. The average annual value of this contract is approximately $560,000. Federal IT support contracts can vary significantly in price based on the scope of services, number of users supported, complexity of systems, and required service levels (e.g., 24/7 support vs. standard business hours). To provide a precise comparison, one would need to analyze contracts with similar service descriptions, duration, and agency. However, for a five-year IT support contract, $2.8 million is a moderate figure, not exceptionally high or low, suggesting a potentially standard scope of work.

What are the potential risks associated with a firm-fixed-price contract for IT support?

While firm-fixed-price (FFP) contracts are generally favored for cost control, they can present risks in complex IT support scenarios. If the scope of work is not precisely defined or if unforeseen technical challenges arise, the contractor may incur higher costs than anticipated. This could lead to the contractor seeking change orders, potentially increasing the overall cost, or conversely, the contractor might cut corners on service quality to maintain profitability, impacting the value received by the government. Effective contract management and clear performance metrics are crucial to mitigate these risks and ensure the government receives the intended level of service.

What is the track record of Countertrade Products, Inc. in performing federal IT support contracts?

The provided data identifies Countertrade Products, Inc. as the contractor but does not offer details on their past performance or track record with federal IT support contracts. To assess their reliability and capability, one would need to review their contract history, past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any documented issues or successes on previous government engagements. Without this information, it is difficult to gauge their experience and effectiveness in delivering similar IT services.

Industry Classification

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

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 70VT1523Q00002

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 7585 W 66TH AVE, ARVADA, CO, 80003

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

Financial Breakdown

Contract Ceiling: $10,627,371

Exercised Options: $4,556,784

Current Obligation: $2,828,073

Actual Outlays: $2,828,073

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: NNG15SC65B

IDV Type: GWAC

Timeline