USCG's $840K internet contract awarded to GCI Communication Corp. for Alaskan base

Contract Overview

Contract Amount: $8,400 ($8.4K)

Contractor: GCI Communication Corp.

Awarding Agency: Department of Homeland Security

Start Date: 2025-04-01

End Date: 2027-03-31

Contract Duration: 729 days

Daily Burn Rate: $12/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMERCIAL INTERNET SERVICES FOR USCG MSU KODIAK

Place of Performance

Location: KODIAK, KODIAK ISLAND County, ALASKA, 99615

State: Alaska Government Spending

Plain-Language Summary

Department of Homeland Security obligated $8,400 to GCI COMMUNICATION CORP. for work described as: COMMERCIAL INTERNET SERVICES FOR USCG MSU KODIAK Key points: 1. Value for money assessed against market rates for similar services. 2. Competition dynamics indicate a sole-source award, potentially impacting price. 3. Risk indicators include limited competition and reliance on a single provider. 4. Performance context is a critical internet service for Coast Guard operations. 5. Sector positioning within wireless telecommunications carriers is noted.

Value Assessment

Rating: fair

The contract value of $840,000 over two years for commercial internet services at a remote Alaskan location appears within a reasonable range, considering the logistical challenges and potential for higher pricing in such areas. Benchmarking against similar government contracts for internet services in remote or challenging environments would provide a clearer picture of value. However, without specific data on bandwidth, service level agreements, and comparable market rates in Kodiak, Alaska, a definitive value assessment is difficult. The firm-fixed-price structure helps control costs but does not inherently guarantee the best value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the Simplified Acquisition Procedures (SAP), indicating a sole-source award. The data does not specify the justification for this sole-source determination, which could be due to the unique capabilities of GCI Communication Corp. in the specific geographic area or other factors. The lack of competition means that potential cost savings from a competitive bidding process were not realized, and the government did not benefit from a wider range of technical solutions or pricing options.

Taxpayer Impact: The sole-source nature of this award means taxpayers may have paid a premium compared to what might have been achieved through a competitive process. Without competition, there is less pressure on the contractor to offer the lowest possible price.

Public Impact

The U.S. Coast Guard MSU Kodiak will benefit from reliable commercial internet services. Essential communication and operational capabilities for the Coast Guard in Alaska will be maintained. The geographic impact is localized to Kodiak, Alaska, supporting a critical military installation. Workforce implications are minimal, as this contract primarily supports existing infrastructure rather than creating new jobs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Sole-source award raises questions about the availability of alternative providers or solutions.
Dependence on a single provider could create risks if service is interrupted.

Positive Signals

Ensures essential communication services for a remote Coast Guard facility.
Firm-fixed-price contract provides cost certainty for the duration of the award.
Contract awarded to a known entity, potentially simplifying management.

Sector Analysis

This contract falls within the telecommunications sector, specifically wireless carriers. The market for internet services, especially in remote locations like Alaska, can be concentrated, with limited providers capable of offering reliable service. Government spending in this area is crucial for maintaining operational capabilities in geographically dispersed regions. Comparable spending benchmarks would typically involve analyzing other federal contracts for similar services in remote areas, considering factors like bandwidth, latency, and service level agreements.

Small Business Impact

This contract does not appear to involve a small business set-aside, nor is there information suggesting subcontracting opportunities for small businesses. The award is to GCI Communication Corp., a larger entity. Therefore, the direct impact on the small business ecosystem is likely negligible for this specific procurement.

Oversight & Accountability

Oversight for this contract would typically fall under the U.S. Coast Guard's contracting and program management offices within the Department of Homeland Security. Accountability measures are inherent in the contract terms, including service level agreements and payment schedules tied to performance. Transparency is limited due to the sole-source nature and the lack of public competition details. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Commercial Internet Services
Telecommunications Services
Department of Homeland Security Contracts
U.S. Coast Guard Procurement
Alaska Federal Contracts

Risk Flags

Sole-source award lacks competitive justification.
Potential for higher costs due to lack of competition.
Dependency on a single provider for critical infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $8,400 to GCI COMMUNICATION CORP.. COMMERCIAL INTERNET SERVICES FOR USCG MSU KODIAK

Who is the contractor on this award?

The obligated recipient is GCI COMMUNICATION CORP..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $8,400.

What is the period of performance?

Start: 2025-04-01. End: 2027-03-31.

What is the specific justification for awarding this contract on a sole-source basis to GCI Communication Corp.?

The provided data indicates the contract was 'NOT COMPETED UNDER SAP' and is a sole-source award. The specific justification for this sole-source determination is not detailed in the provided information. Typically, sole-source awards are made when only one responsible source is available or capable of providing the required service, often due to unique capabilities, geographic limitations, or urgent needs. For a remote location like Kodiak, Alaska, it's plausible that GCI Communication Corp. is the only provider with the necessary infrastructure and capacity to deliver reliable commercial internet services. Further investigation into the contract file or agency justifications would be required to confirm the precise reasons.

How does the price of $840,000 for 729 days of service compare to market rates for similar internet services in remote Alaskan locations?

The contract value of $840,000 over approximately two years equates to roughly $1,152,263 annually, or about $96,022 per month. This price point for commercial internet services in a remote location like Kodiak, Alaska, needs to be benchmarked against available market data. Factors such as bandwidth, latency, reliability (service level agreements), and the specific infrastructure required significantly influence pricing in such areas. Without access to GCI's public pricing for comparable business services in Kodiak or data from other government contracts in similar remote regions, it is challenging to definitively state whether this represents a competitive market rate. However, internet services in remote and challenging geographies are generally more expensive than in urban centers.

What are the potential risks associated with a sole-source award for critical communication infrastructure?

Sole-source awards for critical infrastructure like internet services carry several inherent risks. Firstly, the lack of competition can lead to higher prices than might be achieved through a competitive bidding process, meaning taxpayers may not receive the best value for their money. Secondly, it creates a dependency on a single provider, which can be problematic if that provider experiences service disruptions, price increases, or decides to discontinue services. This dependency can impact the operational continuity of the U.S. Coast Guard facility. Lastly, without competitive pressure, there might be less incentive for the sole-source provider to innovate or offer superior service levels beyond the contractual minimums.

What are the expected service levels and performance metrics for this contract?

The provided data indicates a 'FIRM FIXED PRICE' contract type and specifies the start and end dates (April 1, 2025, to March 31, 2027), totaling 729 days. However, the specific service levels, performance metrics, bandwidth, uptime guarantees, and other technical specifications are not detailed in this summary. These critical details would typically be outlined in the contract's Statement of Work (SOW) or Performance Work Statement (PWS). For a critical service like internet for a Coast Guard base, one would expect stringent requirements regarding reliability, speed, and availability, likely with penalties for non-performance. These details are essential for a comprehensive assessment of the contract's value and effectiveness.

How does this contract fit within the broader spending patterns for telecommunications services by the U.S. Coast Guard or Department of Homeland Security?

This $840,000 contract for commercial internet services represents a relatively small portion of the overall telecommunications budget for the U.S. Coast Guard or the Department of Homeland Security (DHS). DHS, as a large federal agency, likely spends billions on various communication and IT services annually, including satellite, terrestrial, and wireless solutions across its components. This specific award addresses a localized need for a particular facility (USCG MSU Kodiak). Analyzing this contract in isolation provides limited insight into broader spending trends. A comprehensive review would require examining historical spending data for similar services across the agency, identifying any patterns in sole-source awards, and understanding the strategic investments in communication infrastructure for remote operational sites.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wireless Telecommunications Carriers (except Satellite)

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - NETWORK

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 37380PR250000041

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2550 DENALI ST STE 1000, ANCHORAGE, AK, 99503

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

Financial Breakdown

Contract Ceiling: $16,800

Exercised Options: $16,800

Current Obligation: $8,400

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline