HHS awards $9.96M for computer systems design, with a 3-year duration

Contract Overview

Contract Amount: $9,964,235 ($10.0M)

Contractor: AZ Cyber Security Solutions, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2024-03-12

End Date: 2027-03-11

Contract Duration: 1,094 days

Daily Burn Rate: $9.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 9

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: AZ CYBER SECURITY SOLUTIONS, INC:1348790 [24-001176]

Place of Performance

Location: ASHBURN, LOUDOUN County, VIRGINIA, 20147

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $10.0 million to AZ CYBER SECURITY SOLUTIONS, INC. for work described as: AZ CYBER SECURITY SOLUTIONS, INC:1348790 [24-001176] Key points: 1. Contract value of $9.96M over three years suggests a moderate annual spend. 2. The contract type is 'Firm Fixed Price', which shifts cost risk to the contractor. 3. Competition was 'Full and Open Competition After Exclusion of Sources', indicating a potentially complex procurement process. 4. The North American Industry Classification System (NAICS) code 541512 points to specialized computer systems design services. 5. The contract is a Delivery Order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar vehicle. 6. The contract's duration of 1094 days (approx. 3 years) provides a stable period for service delivery.

Value Assessment

Rating: good

The contract value of $9.96 million over approximately three years averages to about $3.32 million annually. Benchmarking this against similar computer systems design contracts within the federal government would require access to a broader dataset of contract values and scopes. However, the firm-fixed-price structure suggests the government has negotiated a set price, aiming for cost certainty. Without specific performance metrics or comparable contract details, a precise value-for-money assessment is challenging, but the fixed-price nature is a positive indicator for cost control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources'. This specific designation implies that while the competition was intended to be open, certain sources were excluded prior to the solicitation. This could be due to various reasons, such as specific technical requirements, prior performance issues, or other justifications. The number of bidders is not explicitly stated, but the 'exclusion of sources' suggests a potentially narrower field of competition than a purely 'full and open' process.

Taxpayer Impact: While the competition was not entirely unrestricted, the 'full and open' aspect suggests an effort to solicit from a broad base of qualified vendors. The exclusion of sources may limit the number of potential bidders, potentially impacting the downward pressure on pricing compared to a completely open competition.

Public Impact

The primary beneficiary is the Department of Health and Human Services (HHS), specifically the National Institutes of Health (NIH), receiving computer systems design services. The services delivered are related to computer systems design, which could encompass a wide range of IT support, development, or integration activities. The geographic impact is likely concentrated within the operational areas of the NIH, primarily in Virginia where the contractor is located. Workforce implications may include the creation or sustainment of jobs within AZ CYBER SECURITY SOLUTIONS, INC. and potentially its subcontractors, particularly in the IT and cybersecurity sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' in the competition type warrants further investigation to understand the justification and potential impact on market competition.
The specific nature of the 'computer systems design services' is not detailed, making it difficult to assess the full scope and potential risks associated with the contract.
Lack of information on the number of bidders limits the ability to fully assess the competitive landscape and its impact on pricing.

Positive Signals

The contract is awarded as 'Firm Fixed Price', which provides cost certainty for the government and shifts cost overrun risks to the contractor.
The contract duration of approximately three years offers stability for service delivery and planning for the NIH.
The award to AZ CYBER SECURITY SOLUTIONS, INC. indicates a selection based on perceived capability to meet the government's needs for computer systems design.

Sector Analysis

The computer systems design services sector is a critical component of the federal IT landscape, supporting a wide array of agency operations. This contract falls within the broader IT services market, which is characterized by rapid technological advancements and a diverse range of specialized providers. Federal spending in this area is substantial, driven by the need for modernizing legacy systems, developing new digital capabilities, and ensuring robust cybersecurity. Comparable spending benchmarks would typically involve analyzing the average contract value for similar NAICS codes (541512) awarded by agencies like HHS or NIH over similar timeframes.

Small Business Impact

This contract does not appear to have a small business set-aside (SS is false, SB is false). Therefore, the primary focus is on large business competition or other contract vehicles. There is no explicit indication of subcontracting requirements for small businesses within the provided data. The absence of a small business set-aside means that opportunities for small businesses to directly participate in this specific contract are limited, though they might be involved as subcontractors if the prime contractor utilizes them.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the contracting officer and program managers within the National Institutes of Health (NIH). As a firm-fixed-price contract, performance monitoring and adherence to the statement of work are key oversight areas. Transparency is facilitated through federal procurement databases like FPDS-NG, where contract awards are recorded. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected related to the contract's execution or award.

Related Government Programs

IT Services
Computer Systems Design
Information Technology Support
Federal IT Procurement
National Institutes of Health Contracts

Risk Flags

Competition Type Justification
Scope Definition Clarity
Performance Monitoring Metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $10.0 million to AZ CYBER SECURITY SOLUTIONS, INC.. AZ CYBER SECURITY SOLUTIONS, INC:1348790 [24-001176]

Who is the contractor on this award?

The obligated recipient is AZ CYBER SECURITY SOLUTIONS, INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $10.0 million.

What is the period of performance?

Start: 2024-03-12. End: 2027-03-11.

What specific computer systems design services are being procured under this contract?

The provided data indicates the NAICS code is 541512, which covers 'Computer Systems Design Services'. This broad category typically includes designing, developing, and integrating hardware and software systems. Services can range from custom software development, IT infrastructure design, network integration, cloud computing solutions, cybersecurity system design, and IT consulting. Without a detailed statement of work or contract description, the precise nature of the services remains unspecified. However, given the agency (NIH), it likely pertains to supporting biomedical research IT infrastructure, data management systems, or specialized research computing environments.

How does the $9.96 million contract value compare to similar computer systems design contracts awarded by NIH?

To accurately benchmark the $9.96 million contract value, a comprehensive analysis of similar contracts awarded by the National Institutes of Health (NIH) for Computer Systems Design Services (NAICS 541512) over comparable timeframes (approximately 3 years) would be necessary. Federal procurement data, such as that available through the Federal Procurement Data System (FPDS), could be queried to identify comparable awards. Factors such as contract scope, complexity, specific services required, and the number of bidders influence pricing. Generally, a $3.32 million annual spend for specialized IT services within a major research institution like NIH is within a plausible range, but a definitive comparison requires detailed market research.

What are the potential risks associated with the 'Full and Open Competition After Exclusion of Sources' award type?

The 'Full and Open Competition After Exclusion of Sources' award type presents specific risks. While it aims for broad competition, the exclusion of certain sources implies that the government has determined specific vendors are not eligible or suitable for reasons documented in the procurement record. This exclusion could limit the pool of highly qualified bidders, potentially leading to less competitive pricing than a truly unrestricted full and open competition. Risks include a reduced number of innovative solutions being proposed and a potential for the selected contractor to have less pressure to offer the most cost-effective services. Understanding the justification for exclusion is crucial to assessing whether it was necessary and appropriate.

What is the significance of the 'Firm Fixed Price' contract type for this computer systems design service?

The 'Firm Fixed Price' (FFP) contract type is significant because it places the majority of the cost risk on the contractor, AZ CYBER SECURITY SOLUTIONS, INC. Under an FFP agreement, the contractor is obligated to complete the work for a predetermined price, regardless of their actual costs incurred. This provides the government, specifically the NIH, with significant cost certainty and predictability. It incentivizes the contractor to manage their costs efficiently and effectively to maximize profit. For the government, the primary risk shifts from cost overruns to ensuring the contractor meets the defined scope, quality, and schedule requirements.

What is the historical spending pattern for computer systems design services at NIH?

Analyzing historical spending patterns for computer systems design services at the NIH requires access to detailed historical procurement data. This would involve examining annual spending on NAICS code 541512 and related IT services over several fiscal years. Trends might reveal whether spending in this category has been increasing, decreasing, or remaining stable. It would also highlight which contractors have been historically successful in winning these types of awards and the typical contract values and durations. Such analysis helps in understanding the agency's reliance on external IT support and the market dynamics within which this contract operates.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 9

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: AZ Cyber Security Solutions Inc.

Address: 21329 CAMERON HUNT PLC, ASHBURN, VA, 20147

Business Categories: 8(a) Program Participant, Black American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $9,964,235

Exercised Options: $9,964,235

Current Obligation: $9,964,235

Actual Outlays: $6,190,773

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 47QTCB21D0117

IDV Type: GWAC

Timeline