HHS awards $13M+ for cybersecurity and management support to CenterPoint LLC, with 3 bids received

Contract Overview

Contract Amount: $13,084,491 ($13.1M)

Contractor: Centerpoint LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2021-08-10

End Date: 2027-02-23

Contract Duration: 2,023 days

Daily Burn Rate: $6.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: LABOR HOURS

Sector: IT

Official Description: SAMHSA CYBERSECURITY AND MANAGEMENT SUPPORT

Place of Performance

Location: LEESBURG, LOUDOUN County, VIRGINIA, 20176

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $13.1 million to CENTERPOINT LLC for work described as: SAMHSA CYBERSECURITY AND MANAGEMENT SUPPORT Key points: 1. Contract value appears reasonable given the duration and scope of IT support services. 2. Full and open competition suggests a competitive bidding environment. 3. The contract duration extends over several years, indicating a need for sustained support. 4. Services are categorized under Computer Systems Design, a common IT support area. 5. The award is a delivery order under a larger contract vehicle. 6. Virginia is the performance location, potentially impacting local IT workforce.

Value Assessment

Rating: good

The contract value of over $13 million for approximately 5.5 years of cybersecurity and management support seems within a reasonable range for IT services of this nature. Benchmarking against similar contracts for IT management and cybersecurity support within HHS or other federal agencies would provide a more precise value-for-money assessment. The pricing structure, based on labor hours, allows for flexibility but requires careful monitoring to ensure efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition after exclusion of sources, indicating that multiple potential bidders were allowed to submit proposals. With three bids received, the competition level suggests a moderate degree of market interest. While not an exhaustive number of bidders, it provides a basis for price discovery and selection of a qualified contractor.

Taxpayer Impact: A competitive bidding process helps ensure that taxpayer funds are used efficiently by driving down prices and encouraging high-quality service delivery.

Public Impact

The Substance Abuse and Mental Health Services Administration (SAMHSA) benefits from enhanced cybersecurity and management support. Services delivered include IT system design, cybersecurity measures, and general management support. The primary geographic impact is in Virginia, where the contract performance is located. The contract supports the IT workforce involved in delivering these specialized services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if requirements are not clearly defined and managed.
Reliance on a single contractor for critical cybersecurity functions requires robust oversight.
The labor hour pricing model necessitates diligent tracking to prevent cost overruns.

Positive Signals

Awarded through full and open competition, indicating a broad market search.
The contract duration suggests a stable and ongoing need for these services.
CenterPoint LLC's selection implies they met the technical and performance requirements.

Sector Analysis

The federal IT services market is substantial, with agencies consistently investing in cybersecurity and IT management to protect sensitive data and ensure operational continuity. This contract falls within the Computer Systems Design Services category, which encompasses a wide range of IT support functions. Comparable spending benchmarks for similar cybersecurity and IT management support contracts within HHS and across other federal agencies would provide further context on the scale and pricing of this award.

Small Business Impact

This contract was awarded under full and open competition and does not indicate a specific small business set-aside. While the prime contractor is CenterPoint LLC, the extent of small business subcontracting is not detailed in the provided data. Further analysis would be needed to determine if small businesses are involved in fulfilling parts of this contract and the overall impact on the small business IT ecosystem.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Health and Human Services (HHS) and the Substance Abuse and Mental Health Services Administration (SAMHSA). As a delivery order under a larger contract vehicle, the initial contract vehicle likely has its own oversight mechanisms. Transparency is facilitated through contract databases like SAM.gov. The Inspector General for HHS would have jurisdiction to investigate any potential fraud, waste, or abuse related to this award.

Related Government Programs

HHS IT Modernization Initiatives
Federal Cybersecurity Enhancement Programs
SAMHSA IT Infrastructure Support
General Services Administration (GSA) IT Schedule Contracts

Risk Flags

Potential for cost overruns due to labor hour pricing.
Reliance on contractor for critical cybersecurity functions.
Need for ongoing monitoring of performance against Service Level Agreements (SLAs).

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $13.1 million to CENTERPOINT LLC. SAMHSA CYBERSECURITY AND MANAGEMENT SUPPORT

Who is the contractor on this award?

The obligated recipient is CENTERPOINT LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Substance Abuse and Mental Health Services Administration).

What is the total obligated amount?

The obligated amount is $13.1 million.

What is the period of performance?

Start: 2021-08-10. End: 2027-02-23.

What is CenterPoint LLC's track record with federal cybersecurity and IT management contracts?

A review of CenterPoint LLC's contract history within federal databases like SAM.gov and FPDS would reveal their past performance on similar contracts. This would include examining past performance evaluations, any reported issues or disputes, and the types and values of previous awards. Understanding their experience with cybersecurity, IT management, and support for health-related agencies like SAMHSA is crucial for assessing their capability to fulfill this current contract effectively. Their history with the specific contract vehicle under which this delivery order was placed would also be informative.

How does the awarded amount compare to similar cybersecurity support contracts within HHS?

To benchmark the $13 million award, one would compare it to other contracts awarded by HHS or SAMHSA for cybersecurity and IT management support over similar timeframes (approximately 5.5 years). Key comparison points include the scope of services (e.g., network security, data protection, system design, help desk support), the number of bidders, and the contract type (e.g., labor hours, fixed price). Analyzing the average cost per year or per labor hour for comparable services can indicate whether this contract represents good value for money. A higher number of bids and competitive pricing in similar contracts would suggest that $13 million is a reasonable figure, assuming comparable service levels and contract durations.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks include potential cybersecurity breaches if the contractor's measures are insufficient, cost overruns due to the labor hour pricing model, and performance deficiencies if the contractor fails to meet service level agreements. Mitigation strategies typically involve robust contract oversight by SAMHSA, clearly defined performance metrics and deliverables, regular performance reviews, and potentially security audits. The contract's duration also presents a risk of technological obsolescence if not managed proactively. The competitive nature of the award may mitigate some performance risks by selecting a capable vendor.

How effective has SAMHSA been in managing its IT support contracts historically?

Assessing SAMHSA's historical effectiveness in managing IT support contracts requires analyzing past contract performance data, including on-time delivery rates, budget adherence, and user satisfaction surveys, if available. Reviewing reports from the HHS Office of Inspector General (OIG) related to SAMHSA's IT procurements and contract management can provide insights into systemic issues or successes. Examining the number of contract modifications, disputes, or terminations for default on previous IT contracts can also indicate management effectiveness. A history of successful, well-managed IT contracts would suggest a lower risk for this current award.

What has been the trend in federal spending on cybersecurity and IT management services over the past five years?

Federal spending on cybersecurity and IT management services has shown a consistent upward trend over the past five years, driven by increasing cyber threats, modernization efforts, and the expansion of digital government services. Agencies across the government, including HHS, have prioritized these areas to protect critical infrastructure and sensitive data. Budgetary allocations for cybersecurity have grown significantly, reflecting its national security importance. This overall increase in federal IT spending provides a backdrop for understanding the context of individual contract awards like the one to CenterPoint LLC, suggesting continued demand and investment in these capabilities.

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: 3

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 8280 WILLOW OAKS CORPORATE DR STE 600, FAIRFAX, VA, 22031

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

Financial Breakdown

Contract Ceiling: $14,454,061

Exercised Options: $13,084,491

Current Obligation: $13,084,491

Actual Outlays: $10,490,330

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 75N98120D00185

IDV Type: GWAC

Timeline