SBA's $20.6M EIDL SAAS contract awarded to GOLDSCHMITT-CRI LLC for computing infrastructure

Contract Overview

Contract Amount: $20,649,115 ($20.6M)

Contractor: Goldschmitt-Cri LLC

Awarding Agency: Small Business Administration

Start Date: 2021-10-28

End Date: 2022-06-08

Contract Duration: 223 days

Daily Burn Rate: $92.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: EO14042 COVID EIDL SAAS REAL ESTATE CLOSING PLATFORM

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20194

State: Virginia Government Spending

Plain-Language Summary

Small Business Administration obligated $20.6 million to GOLDSCHMITT-CRI LLC for work described as: EO14042 COVID EIDL SAAS REAL ESTATE CLOSING PLATFORM Key points: 1. The contract's value of $20.6 million for a 223-day period suggests a high per-diem cost. 2. Awarded as a sole-source contract, it bypasses competitive bidding, potentially impacting price efficiency. 3. The 'NOT COMPETED' status raises questions about whether the government secured the best possible value. 4. The service category, 'Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services,' is broad and could encompass various cost drivers. 5. The contract's short duration (223 days) may indicate a specific, time-sensitive need or a bridge contract. 6. The fixed-price contract type offers cost certainty but relies heavily on accurate initial scope definition.

Value Assessment

Rating: questionable

The contract's total value of $20.6 million over 223 days equates to approximately $92,372 per day. Without specific details on the services rendered, it is difficult to benchmark this against similar contracts. However, the absence of competition suggests that a thorough price comparison to market rates was likely not performed, potentially leading to a less favorable price for the government.

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. The Small Business Administration (SBA) did not solicit offers from multiple potential contractors. This approach is typically used when only one source is capable of meeting the requirement, but it limits the government's ability to leverage market competition to drive down prices and ensure the best value.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from the cost savings that typically arise from a competitive bidding process, potentially resulting in higher overall expenditure for the service.

Public Impact

The primary beneficiaries are likely the Small Business Administration (SBA) staff and potentially small businesses seeking economic injury disaster loans (EIDL). The services delivered are related to computing infrastructure, data processing, and web hosting, crucial for managing and delivering government services. The geographic impact is likely national, supporting SBA operations across the United States. Workforce implications may include the need for IT support staff to manage and utilize the platform provided by GOLDSCHMITT-CRI LLC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated costs for taxpayers.
Sole-source awards can indicate potential issues with market research or contractor lock-in.
The broad service category makes it difficult to assess if the full scope of services was necessary or cost-effective.

Positive Signals

The contract is for a critical service supporting the SBA's mission.
The firm-fixed-price contract type provides budget certainty for the government.
The award was made to a single entity, potentially streamlining management and delivery.

Sector Analysis

The contract falls within the IT and data processing sector, specifically 'Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services.' This is a large and dynamic market. Comparable spending benchmarks are difficult to establish without knowing the precise nature of the services. However, government spending on cloud computing and data services has been increasing, with agencies seeking scalable and secure solutions.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. The awardee, GOLDSCHMITT-CRI LLC, is not explicitly identified as a small business in this context. Therefore, the direct impact on the small business ecosystem through this specific award is likely minimal, unless the prime contractor engages small businesses for subcontracting opportunities not detailed here.

Oversight & Accountability

Oversight for this contract would typically fall under the Small Business Administration's contracting and program management offices. As a sole-source award, it may receive heightened scrutiny. Transparency is limited by the lack of competitive bidding documentation. The Inspector General for the SBA would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Economic Injury Disaster Loans (EIDL) Program
Small Business Administration IT Services
Government Cloud Computing Contracts
Data Processing and Hosting Services

Risk Flags

Sole-source award bypasses competition.
High daily cost without clear service breakdown.
Potential for lack of price discovery.
Limited transparency on justification for sole-source.

Frequently Asked Questions

What is this federal contract paying for?

Small Business Administration awarded $20.6 million to GOLDSCHMITT-CRI LLC. EO14042 COVID EIDL SAAS REAL ESTATE CLOSING PLATFORM

Who is the contractor on this award?

The obligated recipient is GOLDSCHMITT-CRI LLC.

Which agency awarded this contract?

Awarding agency: Small Business Administration (Small Business Administration).

What is the total obligated amount?

The obligated amount is $20.6 million.

What is the period of performance?

Start: 2021-10-28. End: 2022-06-08.

What specific services does GOLDSCHMITT-CRI LLC provide under this contract, and how do they align with the SBA's EIDL program needs?

The provided data categorizes the contract under 'Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services.' For the SBA's EIDL program, this likely translates to providing the necessary IT infrastructure, databases, and web hosting to support the application, processing, and disbursement of disaster loans. This could include servers, storage, network capabilities, software platforms for loan management, and secure data handling to ensure the integrity and availability of sensitive financial information. The specific functionalities would be detailed in the Statement of Work (SOW) which is not provided here, but it is essential for the operational continuity of the EIDL initiative.

What is the justification for awarding this contract on a sole-source basis, and were alternative solutions considered?

Sole-source awards are typically justified when only one responsible source is available or capable of meeting the agency's needs. For the SBA's EIDL SAAS contract, the justification might stem from unique proprietary technology, an urgent need that precludes competition, or a specific existing relationship or integration requirement that only GOLDSCHMITT-CRI LLC can fulfill. Without the official justification documentation (e.g., a Justification and Approval - J&A), it's impossible to confirm the exact reasons. However, the absence of competition means that the government did not explore whether other vendors could provide similar or superior services at a better price point through a competitive process.

How does the daily cost of this contract ($92,372/day) compare to industry benchmarks for similar IT infrastructure and data processing services?

Benchmarking the daily cost of $92,372 for this contract is challenging without a detailed breakdown of the services provided and the service level agreements (SLAs). However, this figure represents a significant daily expenditure. Industry benchmarks for cloud computing, data processing, and web hosting vary widely based on scale, complexity, security requirements, and support levels. For large-scale enterprise solutions, such daily costs might be justifiable if they encompass comprehensive infrastructure, advanced security, high availability, and dedicated support. However, for less complex needs, this rate could be considered high, underscoring the importance of competitive bidding to ensure cost-effectiveness.

What are the potential risks associated with a sole-source award for critical IT services like those supporting the EIDL program?

The primary risk of a sole-source award for critical IT services is the potential for overpayment due to the lack of competitive pressure on pricing. This can lead to taxpayers bearing a higher cost than necessary. Another risk is vendor lock-in, where the agency becomes dependent on a single provider, making it difficult and costly to switch vendors in the future, even if performance or pricing issues arise. Furthermore, without competition, there's less incentive for the sole-source provider to innovate or proactively improve services beyond the contractual minimums. Finally, it raises concerns about whether the agency conducted adequate market research to confirm that no other viable options existed.

What is the historical spending pattern for similar IT infrastructure and data processing services by the Small Business Administration?

Historical spending patterns for IT infrastructure and data processing by the SBA would reveal trends in their procurement strategies and the types of services they prioritize. Analyzing past contracts for similar services, including their award types (competed vs. sole-source), durations, and values, can provide context for the $20.6 million EIDL SAAS contract. If the SBA has a history of sole-source awards in this category, it might indicate systemic issues with competition or specific agency needs. Conversely, a history of competitive awards would make this sole-source contract an outlier requiring closer examination. Without access to historical SBA procurement data, a precise comparison is not possible.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 73351022R0002

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11601 QUAIL RIDGE CT, RESTON, VA, 20194

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, SBA Certified 8 a Joint Venture, Service Disabled Veteran Owned Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $39,384,615

Exercised Options: $20,649,115

Current Obligation: $20,649,115

Actual Outlays: $20,649,115

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $19,052,275

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline