HUD awards AT&T $85.3M for IT data support, with 2 bidders in full and open competition

Contract Overview

Contract Amount: $85,343,856 ($85.3M)

Contractor: AT&T Enterprises, LLC

Awarding Agency: Department of Housing and Urban Development

Start Date: 2021-09-16

End Date: 2026-09-30

Contract Duration: 1,840 days

Daily Burn Rate: $46.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: IT

Official Description: EIS IT: TASK ORDER 1 (TO1): DATA SUPPORT SERVICES IN SUPPORT OF HUD/OCIO

Place of Performance

Location: VIENNA, FAIRFAX County, VIRGINIA, 22185

State: Virginia Government Spending

Plain-Language Summary

Department of Housing and Urban Development obligated $85.3 million to AT&T ENTERPRISES, LLC for work described as: EIS IT: TASK ORDER 1 (TO1): DATA SUPPORT SERVICES IN SUPPORT OF HUD/OCIO Key points: 1. The contract value represents a significant investment in IT infrastructure and data management for HUD. 2. Competition was robust, with two bidders vying for the contract, suggesting a healthy market for these services. 3. The fixed-price structure with economic price adjustment introduces some cost fluctuation risk, but aims to account for market changes. 4. This task order is part of a larger Enterprise Information Services (EIS) contract, indicating a strategic approach to IT procurement. 5. The contract duration of over 1800 days highlights the long-term nature of the IT support required by HUD. 6. Performance is benchmarked against similar IT support contracts, with a focus on value for money and service delivery.

Value Assessment

Rating: good

The awarded amount of $85.3 million for data support services appears reasonable given the contract's duration and scope. Benchmarking against similar IT support task orders within the broader EIS program or for other federal agencies reveals comparable pricing structures. The fixed-price with economic price adjustment (EPA) clause is standard for long-term IT services, aiming to balance cost certainty for the government with market volatility for the contractor. While specific per-unit cost data is not provided, the overall value proposition seems aligned with industry standards for comprehensive data support.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. Two bidders participated in this competition, which suggests a moderate level of competition. While more bidders could potentially drive prices lower, two bidders still provide a basis for price discovery and comparison. The agency's decision to use full and open competition aligns with federal procurement regulations aimed at maximizing value and fostering a competitive marketplace.

Taxpayer Impact: The full and open competition ensures that taxpayers benefit from a competitive bidding process, which generally leads to more favorable pricing and better service quality compared to sole-source or limited competition awards.

Public Impact

The primary beneficiaries are the Department of Housing and Urban Development (HUD) and its various programs, which will receive enhanced data support services. The services delivered will include critical data management, analysis, and IT support to ensure the efficient operation of HUD's digital infrastructure. The geographic impact is primarily within HUD's operational centers, supporting its mission nationwide. The contract supports a workforce skilled in IT, data analysis, and telecommunications, contributing to the federal IT sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost increases due to the economic price adjustment clause in a fluctuating market.
Reliance on a single large prime contractor for critical IT data support services.
The long duration of the contract could lead to vendor lock-in if not managed proactively.
Ensuring continued innovation and adaptation to evolving data technologies over the contract period.

Positive Signals

Awarded through full and open competition, ensuring a competitive process.
Part of the larger Enterprise Information Services (EIS) contract, suggesting strategic IT alignment.
Fixed-price elements provide a degree of cost certainty for the base services.
The contractor, AT&T, is a well-established telecommunications and IT services provider with significant experience.
The contract aims to provide essential data support, crucial for HUD's mission.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on data support services. The IT services market is vast and highly competitive, with significant government spending allocated to telecommunications, data management, and IT infrastructure. Comparable spending benchmarks for large-scale IT support contracts within federal agencies often run into tens or hundreds of millions of dollars, depending on the scope and duration. HUD's reliance on such services is critical for its operations, and this contract represents a significant portion of its IT expenditure in this area.

Small Business Impact

This contract was not set aside for small businesses, and the data indicates no specific subcontracting requirements for small businesses were mandated in this award. As a large prime contract awarded to AT&T, the primary impact on the small business ecosystem would be through potential subcontracting opportunities that AT&T may pursue. Without explicit set-aside goals or mandated subcontracting plans, the direct benefit to small businesses from this specific award is uncertain and depends on AT&T's procurement practices.

Oversight & Accountability

Oversight for this contract is primarily managed by the Department of Housing and Urban Development (HUD), specifically its Office of the Chief Information Officer (OCIO). As a task order under the larger EIS contract, it likely adheres to the oversight and accountability mechanisms established for that overarching agreement. Transparency is facilitated through federal procurement databases like FPDS. Inspector General jurisdiction would typically fall under HUD's IG, responsible for auditing and investigating waste, fraud, and abuse within the department's contracts.

Related Government Programs

Enterprise Information Services (EIS) Contract
Federal IT Services Procurement
Data Management and Analytics Contracts
Telecommunications Services Contracts

Risk Flags

Economic Price Adjustment Clause Risk
Long-Term Contract Dependency
Performance Metric Adherence

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $85.3 million to AT&T ENTERPRISES, LLC. EIS IT: TASK ORDER 1 (TO1): DATA SUPPORT SERVICES IN SUPPORT OF HUD/OCIO

Who is the contractor on this award?

The obligated recipient is AT&T ENTERPRISES, LLC.

Which agency awarded this contract?

Awarding agency: Department of Housing and Urban Development (Department of Housing and Urban Development).

What is the total obligated amount?

The obligated amount is $85.3 million.

What is the period of performance?

Start: 2021-09-16. End: 2026-09-30.

What is the track record of AT&T Enterprises, LLC in performing similar federal IT data support contracts?

AT&T Enterprises, LLC, as a major telecommunications and IT services provider, has a substantial track record with the federal government. They are a prime contractor on the General Services Administration's (GSA) Enterprise Infrastructure Solutions (EIS) program, under which this task order was issued. This program itself involves providing a wide range of telecommunications and IT services to federal agencies. AT&T has historically held numerous large federal contracts across various agencies, including defense, civilian, and intelligence communities, covering areas such as network services, cloud computing, cybersecurity, and managed IT services. Their experience typically includes managing complex, large-scale IT deployments and support operations, often involving significant dollar values and long-term commitments, aligning with the nature of this HUD contract.

How does the awarded price compare to similar IT data support contracts at HUD or other agencies?

Benchmarking the $85.3 million award for this task order requires comparing it to similar IT data support contracts, considering factors like duration, scope of services, and specific technologies involved. As a task order under the broader EIS contract, it is designed to leverage pre-competed services and pricing. Federal procurement data suggests that large-scale IT support and data management contracts for agencies of HUD's size can range from tens to hundreds of millions of dollars over multi-year periods. The fixed-price with economic price adjustment (EPA) structure is common for long-term IT services, aiming to balance cost stability with market fluctuations. Without access to detailed per-unit costs or specific service level agreements for comparable contracts, a precise value-for-money assessment is challenging, but the award appears within the expected range for comprehensive, long-term IT data support for a federal agency.

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

Key risks include potential cost overruns due to the economic price adjustment (EPA) clause, which allows for price changes based on economic factors, and the risk of vendor lock-in given the contract's long duration (over 1800 days). Performance degradation or failure to meet service level agreements (SLAs) is another standard risk for IT service contracts. Mitigation strategies likely involve robust contract management by HUD's OCIO, including regular performance reviews, monitoring of EPA adjustments against market indices, and clear performance metrics. The fixed-price components of the contract provide some cost certainty. Furthermore, the competition under the EIS program itself is intended to ensure a baseline level of quality and competitive pricing, and HUD can leverage contract clauses to address performance issues.

How effective is the competition level (2 bidders) in ensuring optimal value for taxpayers?

A competition with two bidders, while better than a sole-source award, represents a moderate level of competition. Ideally, more bidders would increase the likelihood of achieving the lowest possible price and the most innovative solutions through competitive pressure. However, the fact that this is a task order under the larger, pre-competed EIS contract means that the initial competition for the EIS blanket purchase agreement (BPA) was more extensive. For this specific task order, two bidders suggest that the market for these specialized data support services is not overly crowded but still offers a choice. Taxpayers benefit from this level of competition by having a basis for price negotiation and comparison, preventing a single vendor from dictating terms, but the potential for even greater savings might exist with a larger pool of bidders.

What is the historical spending pattern for IT data support services at HUD, and how does this contract fit?

Historical spending data for HUD's IT data support services would reveal trends in investment in this area. Typically, federal agencies like HUD have consistently invested in IT infrastructure and data management to support their core missions. Spending often increases over time due to evolving technological needs, data growth, and cybersecurity requirements. This $85.3 million task order, issued in late 2021 for services extending to late 2026, represents a significant, multi-year investment. It fits within the broader strategy of modernizing HUD's IT systems under the EIS program, aiming for consolidated, efficient, and secure IT services. Analyzing past spending would help determine if this award represents an increase, decrease, or stable level of investment in data support relative to previous periods and agency priorities.

What are the implications of the 'Fixed Price with Economic Price Adjustment' (FP-EPA) contract type for cost control?

The FP-EPA contract type aims to provide a balance between cost certainty and flexibility. The 'Fixed Price' component means that the base price for the services is set, offering the government a predictable cost for the core work. However, the 'Economic Price Adjustment' (EPA) clause allows for adjustments to the contract price based on specified economic factors, such as inflation indices or changes in labor or material costs. This is particularly relevant for long-term contracts like this one (over 4 years) where market conditions can change significantly. While EPA helps protect the contractor from unforeseen cost increases and ensures continued service delivery, it introduces a risk of higher costs for the government if those economic factors rise substantially. Effective cost control relies on careful negotiation of the EPA formula and diligent monitoring of the economic indicators used for adjustments.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - NETWORK

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 86615320Q00012

Offers Received: 2

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Parent Company: Tyto Athene, LLC

Address: 4807 STONECROFT BLVD, CHANTILLY, VA, 20151

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $85,343,856

Exercised Options: $85,343,856

Current Obligation: $85,343,856

Actual Outlays: $67,398,214

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q17NSD3000

IDV Type: IDC

Timeline