USDA's $11.36M IT hosting contract awarded to NATEK INCORPORATED via full and open competition

Contract Overview

Contract Amount: $11,360,127 ($11.4M)

Contractor: Natek Incorporated

Awarding Agency: Department of Agriculture

Start Date: 2007-10-02

End Date: 2008-09-30

Contract Duration: 364 days

Daily Burn Rate: $31.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: FIXED PRICE LEVEL OF EFFORT

Sector: IT

Official Description: BPA CALL. HOSTING OPERATIONS FOR FY08.

Place of Performance

Location: STERLING, LOUDOUN County, VIRGINIA, 20166

State: Virginia Government Spending

Plain-Language Summary

Department of Agriculture obligated $11.4 million to NATEK INCORPORATED for work described as: BPA CALL. HOSTING OPERATIONS FOR FY08. Key points: 1. Contract awarded for IT hosting operations, indicating a need for robust digital infrastructure. 2. The fixed-price contract type suggests a defined scope and predictable costs for the government. 3. Awarded as a Purchase Order, this is a common mechanism for acquiring goods and services. 4. The contract duration of 364 days aligns with typical annual IT service agreements. 5. The North American Industry Classification System (NAICS) code 541519 points to 'Other Computer Related Services'. 6. The contract was awarded through full and open competition, suggesting a competitive bidding process. 7. The small business set-aside flag is false, indicating it was not specifically reserved for small businesses.

Value Assessment

Rating: fair

The contract value of $11.36 million for one year of hosting operations appears to be within a reasonable range for federal IT services. Benchmarking against similar hosting contracts would provide a clearer picture of value for money. The fixed-price level of effort structure helps control costs, but the specific pricing details and comparison to market rates are not available in this data. Without more granular cost data, a definitive assessment of cost-effectiveness is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, meaning all responsible sources were permitted to submit a bid. The data indicates there were 7 bids received, suggesting a healthy level of competition for this IT hosting requirement. A competitive process like this generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are likely being used efficiently by driving down prices through a competitive bidding environment.

Public Impact

The Office of the Chief Financial Officer within the Department of Agriculture benefits from reliable IT hosting services. This contract supports essential digital infrastructure for the agency's financial operations. The services delivered are crucial for maintaining the continuity and security of the agency's data. The geographic impact is primarily within the agency's operational footprint, likely supporting its Virginia-based operations. Workforce implications are indirect, supporting the IT professionals who manage and utilize these hosting services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed performance metrics makes it difficult to assess service quality.
Limited insight into the specific technologies and security protocols used for hosting.
No data on potential vendor lock-in or exit strategies.
Absence of information on disaster recovery and business continuity plans.

Positive Signals

Awarded via full and open competition, indicating a robust selection process.
Fixed-price contract type provides cost predictability.
Multiple bids (7) suggest a competitive market for these services.
Contract supports a critical function (hosting operations) for the agency.

Sector Analysis

The IT services sector, particularly cloud and data center hosting, is a significant area of federal spending. Agencies rely heavily on these services for operational continuity, data storage, and application delivery. The market is competitive, with a mix of large and small providers. Federal spending in this area is driven by the need for secure, scalable, and cost-effective IT infrastructure, often involving complex service level agreements and security compliance requirements.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does the data indicate any specific subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem for this particular award appears minimal. However, the prime contractor, NATEK INCORPORATED, may engage small businesses as subcontractors, which is not detailed in this award data.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Agriculture's contracting officers and program managers. The contract type (Purchase Order) and fixed-price nature suggest a degree of cost control. Transparency is facilitated by the public availability of contract award data. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

IT Infrastructure Services
Cloud Computing Services
Data Center Operations
IT Professional Services
Government IT Contracts

Risk Flags

Lack of detailed performance metrics.
Limited information on specific service level agreements.
No data on security compliance beyond general IT services.
Potential for under-resourcing by contractor due to fixed-price structure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $11.4 million to NATEK INCORPORATED. BPA CALL. HOSTING OPERATIONS FOR FY08.

Who is the contractor on this award?

The obligated recipient is NATEK INCORPORATED.

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Office of the Chief Financial Officer).

What is the total obligated amount?

The obligated amount is $11.4 million.

What is the period of performance?

Start: 2007-10-02. End: 2008-09-30.

What is NATEK INCORPORATED's track record with federal contracts, particularly in IT hosting?

NATEK INCORPORATED has a history of receiving federal contracts, primarily in the IT services domain. While this specific award is for hosting operations, their broader contract portfolio would need to be examined to fully assess their track record. Analyzing past performance on similar contracts, including adherence to schedules, budget, and quality standards, is crucial. Information on past contract awards, modifications, and any performance issues or disputes would provide a more comprehensive view of their reliability and expertise in delivering federal IT services.

How does the $11.36 million cost compare to similar federal IT hosting contracts awarded around the same period?

Benchmarking this $11.36 million contract against similar federal IT hosting contracts awarded in FY2008 requires access to a broader dataset of federal procurements. Factors such as the scope of services (e.g., dedicated servers, virtual private servers, managed services), data center locations, security requirements (e.g., FedRAMP compliance), and service level agreements (SLAs) significantly influence pricing. Without these comparative details, it's difficult to definitively state if this contract represents excellent, fair, or questionable value. However, the fact that it was awarded under full and open competition with multiple bids suggests a competitive market price was likely achieved.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this hosting contract?

The provided data does not specify the key performance indicators (KPIs) or service level agreements (SLAs) for this hosting operations contract. Typically, such contracts would include metrics related to uptime, response times for technical support, data backup and recovery frequency, and security incident response times. The absence of this information in the award data makes it challenging to quantitatively assess the contractor's performance and the quality of services delivered. These details are usually found within the contract's statement of work or associated appendices.

What is the risk associated with NATEK INCORPORATED's performance on this contract, given its fixed-price nature?

The fixed-price level of effort contract structure aims to mitigate cost overrun risks for the government. However, risks can still exist regarding performance quality and scope creep. If the contractor under-resourced the effort to maintain profitability under the fixed price, service quality could suffer. Conversely, if the government requires more effort than initially scoped, they might face challenges in getting additional work done without contract modifications. The primary risk lies in ensuring the contractor delivers the required level of service effectively and efficiently within the agreed-upon price.

How has the Department of Agriculture's spending on IT hosting services evolved over the years?

Analyzing the Department of Agriculture's historical spending on IT hosting services would require a longitudinal study of their procurement data over multiple fiscal years. This specific contract from FY2008 represents a snapshot. Trends might show an increase or decrease in spending due to factors like cloud migration initiatives, consolidation of data centers, or shifts in technology adoption. Understanding these historical patterns is crucial for budget forecasting, identifying efficiency gains, and assessing the agency's strategic approach to IT infrastructure management.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 7

Pricing Type: FIXED PRICE LEVEL OF EFFORT (B)

Evaluated Preference: NONE

Contractor Details

Address: 21355 RIDGETOP CIR, DULLES, VA, 20166

Business Categories: Category Business, Hispanic American Owned Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, Woman Owned Business

Financial Breakdown

Contract Ceiling: $11,360,127

Exercised Options: $11,360,127

Current Obligation: $11,360,127

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline