Contract for Computing Infrastructure Services Awarded to DELAWARE for $1.89M, with a 2027 End Date

Contract Overview

Contract Amount: $188,700 ($188.7K)

Contractor: Delaware Department of Health and Social Services

Awarding Agency: Department of Health and Human Services

Start Date: 2026-04-14

End Date: 2027-05-01

Contract Duration: 382 days

Daily Burn Rate: $494/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: VSCP - DELAWARE

Place of Performance

Location: DURHAM, DURHAM County, NORTH CAROLINA, 27703

State: North Carolina Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $188,700 to DELAWARE DEPARTMENT OF HEALTH AND SOCIAL SERVICES for work described as: VSCP - DELAWARE Key points: 1. The contract value of $1.89M appears moderate for computing infrastructure services. 2. The award was made on a sole-source basis, raising questions about potential price overruns. 3. The contract duration extends over a year, suggesting a need for ongoing services. 4. The specific services fall under a broad category, requiring further detail for precise performance assessment. 5. The absence of competition may limit opportunities for cost savings. 6. The fixed-price contract type offers some cost certainty for the government.

Value Assessment

Rating: fair

The contract value of $1.89M for computing infrastructure services needs to be benchmarked against similar contracts. Without competitive bidding, it is difficult to definitively assess if this represents good value for money. The fixed-price nature provides some predictability, but the lack of competition could mean the government is not achieving the lowest possible price. Further analysis of the specific services and their market rates is required for a more robust value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning there was no open competition. This approach is typically used when only one vendor can provide the required services, or in specific emergency situations. The lack of bidders means that price discovery through market forces was bypassed, potentially leading to higher costs for the government compared to a competed contract.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure to drive down prices. The government did not leverage the benefits of multiple offers to secure the best possible terms.

Public Impact

The primary beneficiaries are likely federal agencies requiring computing infrastructure, data processing, and web hosting services. The contract supports the delivery of essential IT infrastructure for government operations. The geographic impact is primarily within the United States, supporting federal IT needs. Workforce implications may include the need for specialized IT personnel to manage and maintain the contracted services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential savings.
Broad service category may obscure specific performance metrics and value.
Longer contract duration without competition could lead to escalating costs if not managed closely.

Positive Signals

Fixed-price contract provides cost certainty for the awarded amount.
Contract supports critical computing infrastructure needs.
Awarding agency is a key federal health entity (HHS).

Sector Analysis

The market for computing infrastructure, data processing, and web hosting services is vast and highly competitive, with numerous providers ranging from large cloud service providers to specialized IT firms. Federal spending in this sector is substantial, driven by the increasing digitization of government operations and the need for robust IT solutions. This contract fits within the broader IT services sector, supporting essential government functions. Comparable spending benchmarks would typically involve analyzing the average cost of similar cloud hosting or data processing contracts awarded by federal agencies.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific impacts on the small business ecosystem stemming from a small business set-aside. The primary contractor is DELAWARE, and any subcontracting would be at their discretion, not mandated by a set-aside requirement.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Centers for Disease Control and Prevention (CDC) and the Department of Health and Human Services (HHS). Accountability measures would be defined by the contract terms and performance standards. Transparency is generally facilitated through contract databases, though the specifics of sole-source justifications may have limited public detail. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Federal Cloud Computing Strategy
IT Infrastructure Modernization Programs
Data Center Consolidation Initiatives
Centers for Disease Control and Prevention IT Services

Risk Flags

Sole-source award
Lack of competitive bidding
Broad service description

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $188,700 to DELAWARE DEPARTMENT OF HEALTH AND SOCIAL SERVICES. VSCP - DELAWARE

Who is the contractor on this award?

The obligated recipient is DELAWARE DEPARTMENT OF HEALTH AND SOCIAL SERVICES.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Centers for Disease Control and Prevention).

What is the total obligated amount?

The obligated amount is $188,700.

What is the period of performance?

Start: 2026-04-14. End: 2027-05-01.

What is the specific nature of the 'Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services' being procured?

The contract falls under the Product Service Code (PSC) '518210', which covers Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services. This broad category can encompass a wide range of services, including but not limited to cloud computing (IaaS, PaaS, SaaS), dedicated server hosting, data storage, data backup and recovery, network infrastructure management, and associated technical support. Without more specific line-item details or a Statement of Work (SOW), it's challenging to pinpoint the exact services. However, given the agency (CDC/HHS), it likely supports critical health data processing, research, or public health information systems.

How does the $1.89M contract value compare to similar sole-source IT infrastructure contracts?

Benchmarking sole-source contracts is inherently difficult due to the lack of competitive data. However, $1.89M for a contract running over a year (ending May 2027) for computing infrastructure is within a plausible range for specialized IT services. To provide a more accurate comparison, one would need to identify contracts with similar PSC codes, contract durations, and agency types (e.g., other HHS operating divisions or similar federal health agencies). A key factor is the specific scope of services; if it involves highly specialized hardware, extensive data migration, or significant managed services, the price could be justified. Conversely, if it's for standard cloud hosting, it might be on the higher end without competition.

What are the primary risks associated with a sole-source award for IT services?

The primary risk of a sole-source award for IT services is the potential for inflated pricing due to the absence of competitive pressure. Without multiple vendors vying for the contract, the government may not achieve the most cost-effective solution. Another risk is vendor lock-in, where the agency becomes dependent on a single provider, making future transitions difficult and potentially costly. There's also a risk that the chosen vendor may not be the most innovative or offer the best overall solution compared to what could have been achieved through competition. Finally, sole-source justifications can sometimes mask a lack of adequate planning or market research by the procuring agency.

What is the track record of DELAWARE (the contractor) in fulfilling federal IT contracts?

Information regarding DELAWARE's specific track record in fulfilling federal IT contracts is not directly available in the provided data snippet. To assess their performance, one would need to consult federal procurement databases like SAM.gov or FPDS-NG to review past contract awards, performance evaluations (e.g., CPARS), and any history of contract modifications or disputes. Without this external data, it's impossible to evaluate their reliability, past performance quality, or experience with similar government IT requirements.

What are the potential implications of the fixed-price contract type for this service?

A Firm Fixed Price (FFP) contract type, as indicated ('pt': 'FIRM FIXED PRICE'), means the contractor agrees to a set price for the defined scope of work. This provides the government with cost certainty, as the total expenditure is known upfront, barring any contract modifications. The risk of cost overruns lies primarily with the contractor. For IT services like computing infrastructure, an FFP contract is suitable if the scope of work is well-defined and unlikely to change significantly. If the scope is highly variable or subject to unforeseen technical challenges, an FFP contract could incentivize the contractor to cut corners on quality or service levels to protect their profit margin.

How does the contract duration (382 days) align with typical IT infrastructure needs?

A contract duration of 382 days (approximately 1 year and 1 month) is relatively standard for IT infrastructure services, particularly for ongoing operational needs like hosting, data processing, or managed services. This timeframe allows for stable service delivery without committing the government to excessively long terms, which could become outdated with rapid technological advancements. It also provides a reasonable period for the contractor to establish and maintain the required infrastructure. However, given the sole-source nature, the agency should have a clear plan for re-evaluating the need and exploring competitive options upon its expiration.

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: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1901 N DUPONT HWY MAIN BLDG, NEW CASTLE, DE, 19720

Business Categories: Category Business, Government, U.S. National Government, Not Designated a Small Business, U.S. Regional/State Government

Financial Breakdown

Contract Ceiling: $188,700

Exercised Options: $188,700

Current Obligation: $188,700

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 75D30122D13206

IDV Type: IDC

Timeline