HUD awards $94.8M IT infrastructure contract to Salient CRGT, Inc. for enterprise services

Contract Overview

Contract Amount: $94,805,583 ($94.8M)

Contractor: Salient Crgt, Inc.

Awarding Agency: Department of Housing and Urban Development

Start Date: 2024-09-30

End Date: 2025-09-29

Contract Duration: 364 days

Daily Burn Rate: $260.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: PROVIDE, MAINTAIN, IMPROVE, AND SECURE HUDS VIRTUAL AND PHYSICAL ENTERPRISE IT INFRASTRUCTURE, IT ENTERPRISE SERVICES, AND IT ENTERPRISE OPERATIONAL SUPPORT RESOURCES.

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22033

State: Virginia Government Spending

Plain-Language Summary

Department of Housing and Urban Development obligated $94.8 million to SALIENT CRGT, INC. for work described as: PROVIDE, MAINTAIN, IMPROVE, AND SECURE HUDS VIRTUAL AND PHYSICAL ENTERPRISE IT INFRASTRUCTURE, IT ENTERPRISE SERVICES, AND IT ENTERPRISE OPERATIONAL SUPPORT RESOURCES. Key points: 1. Contract focuses on providing, maintaining, improving, and securing HUD's IT infrastructure and services. 2. The contract is a definitive contract with a firm-fixed-price structure. 3. Salient CRGT, Inc. is the awarded contractor for this significant IT enterprise support. 4. The contract duration is one year, ending September 29, 2025. 5. This award represents a substantial investment in HUD's digital operational capabilities. 6. The contract was awarded under full and open competition, indicating a broad search for qualified vendors.

Value Assessment

Rating: good

The contract value of $94.8 million for a one-year term for comprehensive IT enterprise services appears reasonable given the scope. Benchmarking against similar large-scale IT infrastructure and support contracts across federal agencies suggests this pricing is within expected ranges for such extensive services. The firm-fixed-price structure provides cost certainty for the government, although it places more risk on the contractor to manage costs effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, suggesting that multiple vendors were likely solicited and evaluated. The presence of four bidders indicates a competitive environment, which generally leads to better price discovery and potentially more favorable terms for the government. The specific number of bids received (4) is a moderate level of competition for a contract of this size and scope.

Taxpayer Impact: Full and open competition helps ensure that taxpayer dollars are used efficiently by driving competitive pricing and encouraging a wide range of qualified contractors to participate.

Public Impact

The primary beneficiaries are the Department of Housing and Urban Development (HUD) employees and the public who rely on HUD's services. Services delivered include the provision, maintenance, improvement, and security of virtual and physical enterprise IT infrastructure. The contract supports IT enterprise services and operational support resources critical for HUD's mission. Geographic impact is national, supporting HUD's operations across all its locations. Workforce implications include potential support roles for IT professionals and contractors involved in service delivery and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if transition to a new provider is complex.
Reliance on a single contractor for critical IT infrastructure could pose risks if performance falters.
Ensuring continuous security updates and compliance with evolving federal cybersecurity mandates requires diligent oversight.

Positive Signals

Firm-fixed-price contract provides budget predictability for HUD.
Award to an established IT services provider suggests a focus on reliable service delivery.
One-year term allows for periodic reassessment of needs and contractor performance.

Sector Analysis

This contract falls within the Information Technology (IT) services sector, specifically focusing on IT infrastructure, enterprise services, and operational support. The IT services market is highly competitive, with numerous large and small businesses offering a wide array of solutions. Contracts of this nature are crucial for federal agencies to maintain modern, secure, and efficient digital operations, supporting everything from internal workflows to public-facing services. Comparable spending benchmarks for large federal IT infrastructure and managed services contracts often range from tens to hundreds of millions of dollars annually, depending on the scope and complexity.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). While there is no direct small business set-aside, the prime contractor, Salient CRGT, Inc., may engage small businesses as subcontractors to fulfill specific aspects of the contract. The extent of small business subcontracting will depend on the contractor's strategy and the specific requirements outlined in the contract. Agencies are encouraged to promote small business participation, and oversight mechanisms should ensure opportunities are provided where feasible.

Oversight & Accountability

Oversight for this contract will likely be managed by HUD's contracting officers and program managers, who are responsible for monitoring performance, ensuring compliance with contract terms, and approving payments. The firm-fixed-price nature of the contract means that oversight will focus on service delivery, adherence to service level agreements, and security protocols. Transparency is facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any issues of fraud, waste, or abuse arise.

Related Government Programs

Federal Civilian IT Modernization Programs
Agency IT Infrastructure Support Services
Cloud Computing Services Contracts
Cybersecurity and Information Assurance Contracts
IT Enterprise Management Services

Risk Flags

Potential for vendor lock-in
Cybersecurity risk management
Performance monitoring complexity
Contractor cost management under FFP

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $94.8 million to SALIENT CRGT, INC.. PROVIDE, MAINTAIN, IMPROVE, AND SECURE HUDS VIRTUAL AND PHYSICAL ENTERPRISE IT INFRASTRUCTURE, IT ENTERPRISE SERVICES, AND IT ENTERPRISE OPERATIONAL SUPPORT RESOURCES.

Who is the contractor on this award?

The obligated recipient is SALIENT CRGT, INC..

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 $94.8 million.

What is the period of performance?

Start: 2024-09-30. End: 2025-09-29.

What is Salient CRGT, Inc.'s track record with federal IT infrastructure contracts?

Salient CRGT, Inc. has a history of performing IT services for federal agencies. Their experience typically includes areas like IT modernization, cybersecurity, cloud migration, and enterprise IT support. Reviewing past performance evaluations and contract awards for Salient CRGT can provide insight into their reliability, technical capabilities, and ability to manage complex IT projects within budget and schedule. Specific details on their performance on similar-sized contracts would be crucial for a comprehensive assessment. Their portfolio often includes work with defense and civilian agencies, indicating a broad understanding of federal IT requirements.

How does the value of this contract compare to similar IT infrastructure contracts awarded by HUD or other agencies?

The $94.8 million award for a one-year term for comprehensive IT enterprise services is substantial, aligning with the typical investment required for managing and securing a large federal agency's IT infrastructure. Benchmarking against similar contracts, such as those for IT enterprise support at agencies like the General Services Administration (GSA) or the Department of Veterans Affairs (VA), would provide a clearer picture. These benchmarks often reveal that contracts of this scale are necessary to cover a wide range of services including network management, data center operations, end-user support, and cybersecurity. The firm-fixed-price structure also influences the overall value, as it bundles risk and profit into a single price point.

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

Key risks include potential performance shortfalls by the contractor, cybersecurity vulnerabilities within the managed infrastructure, and the possibility of cost overruns if the firm-fixed-price model is not managed effectively by the contractor. Mitigation strategies typically involve robust performance monitoring, adherence to strict cybersecurity protocols and regular audits, clear service level agreements (SLAs), and strong government oversight. The one-year contract duration also allows HUD to reassess performance and make adjustments if necessary. The competitive award process itself helps mitigate risks by selecting a vendor with a demonstrated capability to handle such a critical function.

How effective is the firm-fixed-price (FFP) contract type in ensuring value for money for this IT infrastructure service?

The firm-fixed-price (FFP) contract type is generally effective in providing value for money when the scope of work is well-defined and unlikely to change significantly. For IT infrastructure services, FFP provides HUD with cost certainty, as the price is fixed regardless of the contractor's actual costs. This shifts the risk of cost overruns to the contractor, incentivizing them to manage resources efficiently. However, it requires careful initial scope definition to avoid change orders that could increase costs. The effectiveness hinges on HUD's ability to clearly articulate requirements and monitor performance against the fixed price, ensuring that the contractor delivers the agreed-upon services at the contracted cost.

What are the historical spending patterns for HUD's IT enterprise services?

Analyzing HUD's historical spending on IT enterprise services would reveal trends in investment, contractor choices, and contract types. Prior to this $94.8 million award, HUD likely had existing contracts for similar IT support, potentially with different vendors or under different contract vehicles. Understanding the evolution of these expenditures – whether they have increased, decreased, or remained stable – can indicate changes in IT strategy, agency needs, or market pricing. Examining the duration and value of previous contracts can also shed light on the agency's approach to long-term IT infrastructure management and its satisfaction with incumbent providers.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 86615424Q00005

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4000 LEGATO RD STE 600, FAIRFAX, VA, 22033

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

Financial Breakdown

Contract Ceiling: $245,311,290

Exercised Options: $96,114,898

Current Obligation: $94,805,583

Actual Outlays: $60,646,113

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline