HHS OIG Leases Multifunction Devices for $2.8M, Awarded to The LIOCE Group Inc

Contract Overview

Contract Amount: $2,823,012 ($2.8M)

Contractor: THE Lioce Group Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2019-09-16

End Date: 2025-06-30

Contract Duration: 2,114 days

Daily Burn Rate: $1.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: LEASE AND MAINTENANCE FOR MULTIFUNCTION DEVICES

Place of Performance

Location: BALTIMORE, BALTIMORE CITY County, MARYLAND, 21201

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $2.8 million to THE LIOCE GROUP INC for work described as: LEASE AND MAINTENANCE FOR MULTIFUNCTION DEVICES Key points: 1. Spending on printing machinery and equipment is a significant operational cost for agencies. 2. The LIOCE Group Inc. secured this contract through full and open competition. 3. The contract duration of 2114 days (approx. 5.8 years) suggests a long-term need. 4. This spending falls under the 'Printing Machinery and Equipment Manufacturing' NAICS code.

Value Assessment

Rating: fair

The contract value of $2.8M over nearly 6 years averages around $486,000 annually. Benchmarking this against similar lease and maintenance contracts for multifunction devices is difficult without specific device capabilities and service level agreements, but the annual cost appears moderate.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded using full and open competition, indicating a competitive bidding process. This method generally promotes price discovery and ensures fair market value is obtained.

Taxpayer Impact: Taxpayer funds are being used for essential office equipment, with competition aiming to ensure cost-effectiveness.

Public Impact

Ensures operational continuity for the Office of the Inspector General by providing necessary printing and copying services. Supports agency functions through reliable access to multifunction devices, crucial for document management and communication. The lease agreement includes maintenance, potentially reducing unexpected repair costs and downtime for critical equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with long-term lease agreements.
Need to ensure devices meet evolving technological needs and energy efficiency standards.
Risk of overpaying if maintenance costs escalate significantly over the contract term.

Positive Signals

Awarded through full and open competition, suggesting competitive pricing.
Firm fixed price contract provides cost certainty.
Includes maintenance, offering a bundled solution.

Sector Analysis

Spending on printing machinery and equipment is common across federal agencies for administrative and operational needs. Benchmarks vary widely based on device type, volume, and service agreements, but this contract's annual spend is within a typical range for a medium-sized agency component.

Small Business Impact

The data indicates this contract was not awarded to a small business (ss: false, sb: false). Therefore, there is no direct benefit to small businesses from this specific award, though the prime contractor may utilize small businesses in their subcontracting efforts.

Oversight & Accountability

The Office of the Inspector General (OIG) is responsible for overseeing HHS programs and operations. This contract supports their internal operational needs, ensuring they have the necessary equipment to perform their oversight functions effectively.

Related Government Programs

Printing Machinery and Equipment Manufacturing
Department of Health and Human Services Contracting
Office of the Inspector General Programs

Risk Flags

Long contract duration (approx. 5.8 years).
Lack of specific device details for value assessment.
Potential for maintenance cost escalation.
Risk of technological obsolescence over the lease term.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $2.8 million to THE LIOCE GROUP INC. LEASE AND MAINTENANCE FOR MULTIFUNCTION DEVICES

Who is the contractor on this award?

The obligated recipient is THE LIOCE GROUP INC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (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: 2019-09-16. End: 2025-06-30.

What specific types and volumes of multifunction devices are included in this lease, and how do they align with the OIG's current and projected needs?

The provided data does not specify the exact models, quantities, or capabilities of the multifunction devices leased. Understanding these details is crucial for assessing whether the $2.8 million expenditure represents good value. The agency should ensure the devices are appropriately sized for the OIG's workload and possess the necessary features (e.g., scanning, copying, printing, security) to support their mission effectively over the contract's duration.

What are the projected maintenance costs over the contract's life, and how do they compare to industry standards for similar devices?

The contract includes maintenance, but the specific cost breakdown and projected escalation are not detailed. It's important to analyze the maintenance component to ensure it's competitive. Unexpectedly high maintenance costs could significantly inflate the total contract value, making it less cost-effective than anticipated, especially if device usage is lower than projected.

How will the agency ensure that the leased devices remain technologically relevant and efficient throughout the nearly six-year contract period?

Long-term leases can pose a risk of technological obsolescence. The agency should have a plan for managing this, potentially through clauses allowing for upgrades or device swaps if technology advances significantly. Ensuring the devices meet current energy efficiency standards and security protocols is also vital to avoid compliance issues and operational inefficiencies.

Industry Classification

NAICS: Manufacturing › Industrial Machinery Manufacturing › Printing Machinery and Equipment Manufacturing

Product/Service Code: SPECIAL INDUSTRY MACHINERY

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2950 DRAKE AVE SW, HUNTSVILLE, AL, 35805

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

Financial Breakdown

Contract Ceiling: $5,759,071

Exercised Options: $2,823,012

Current Obligation: $2,823,012

Actual Outlays: $1,995,210

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS03F0143Y

IDV Type: FSS

Timeline