Commerce Department's Patent Office awards $52.7M contract for publishing services, with significant portion obligated early

Contract Overview

Contract Amount: $52,671,478 ($52.7M)

Contractor: Reed Technology and Information Services LLC

Awarding Agency: Department of Commerce

Start Date: 2016-01-27

End Date: 2017-01-31

Contract Duration: 370 days

Daily Burn Rate: $142.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PADACAP CONTRACT (RTIS): DOC50PAPT1500003 - D24152 PGPUB, DEL. ORDR #TBD, POP 02/01/16-05/25/2016. BUDGET RECORD NUMBER P916. AVG BURN RATE: $1,044,381.25 @ 16 WKS. PROJECTED TOTAL NEED FOR FEB - MAY 25, 2016 IS $16,710,100.00.

Place of Performance

Location: HORSHAM, MONTGOMERY County, PENNSYLVANIA, 19044

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Commerce obligated $52.7 million to REED TECHNOLOGY AND INFORMATION SERVICES LLC for work described as: PADACAP CONTRACT (RTIS): DOC50PAPT1500003 - D24152 PGPUB, DEL. ORDR #TBD, POP 02/01/16-05/25/2016. BUDGET RECORD NUMBER P916. AVG BURN RATE: $1,044,381.25 @ 16 WKS. PROJECTED TOTAL NEED FOR FEB - MAY 25, 2016 IS $16,710,100.00. Key points: 1. Contract value of $52.7 million for publishing services indicates a substantial investment in information dissemination. 2. The contract was not competed, raising questions about potential price efficiencies and market-driven value. 3. A high average burn rate of over $1 million per week suggests rapid utilization of funds. 4. The projected need for $16.7 million within the first four months highlights the immediate and intensive nature of the services required. 5. The contract's duration of 370 days points to a medium-term engagement for these publishing needs. 6. The firm-fixed-price structure aims to provide cost certainty for the government.

Value Assessment

Rating: fair

The contract value of $52.7 million for publishing services is significant. Without comparable contract data or detailed service breakdowns, a precise value-for-money assessment is challenging. The firm-fixed-price structure provides some cost predictability. However, the lack of competition means there's no direct benchmark to assess if this price is optimal compared to market alternatives. The rapid burn rate suggests the services are being utilized as planned, but doesn't inherently speak to efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when a specific vendor possesses unique capabilities or when urgency precludes a full competition. The lack of competition limits the government's ability to leverage market forces to achieve the best possible pricing and service terms.

Taxpayer Impact: For taxpayers, a sole-source award means there is a reduced likelihood of benefiting from competitive pricing that could drive down costs. It also limits transparency into whether the government secured the most cost-effective solution available.

Public Impact

The U.S. Patent and Trademark Office (USPTO) is the primary beneficiary, receiving essential publishing services. The contract supports the dissemination of patent and trademark information, crucial for businesses and inventors. Services are likely concentrated within the USPTO's operational framework, impacting its ability to process and publish intellectual property. The workforce implications are primarily related to the contractor's staff performing the publishing tasks.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs than a competed contract.
Sole-source awards can reduce transparency in government spending.
Rapid fund utilization requires careful monitoring to ensure services align with needs.

Positive Signals

Firm-fixed-price contract provides budget certainty.
The contract supports a critical government function (intellectual property dissemination).
The contractor, REED TECHNOLOGY AND INFORMATION SERVICES LLC, is likely experienced in this specialized area.

Sector Analysis

This contract falls within the broader 'Publishing Services' sector, specifically related to government information dissemination and intellectual property management. The market for specialized government publishing can be niche, with a limited number of firms possessing the necessary security clearances, technical capabilities, and understanding of regulatory requirements. Comparable spending benchmarks would likely be found within other agencies requiring large-scale document management and publication.

Small Business Impact

The data indicates this contract was not competed and does not specify any small business set-aside provisions or subcontracting goals. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor voluntarily engages small businesses for subcontracting. Without explicit set-asides, opportunities for small businesses in this specific award are not guaranteed.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers within the U.S. Patent and Trademark Office. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified publishing services. Transparency is limited due to the sole-source nature of the award, but contract actions and performance should be reportable through federal procurement data systems.

Related Government Programs

USPTO Information Dissemination Services
Government Publishing Contracts
Intellectual Property Management Support
Federal Document Management Systems

Risk Flags

Lack of Competition
Potential for Overpricing
Limited Transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $52.7 million to REED TECHNOLOGY AND INFORMATION SERVICES LLC. PADACAP CONTRACT (RTIS): DOC50PAPT1500003 - D24152 PGPUB, DEL. ORDR #TBD, POP 02/01/16-05/25/2016. BUDGET RECORD NUMBER P916. AVG BURN RATE: $1,044,381.25 @ 16 WKS. PROJECTED TOTAL NEED FOR FEB - MAY 25, 2016 IS $16,710,100.00.

Who is the contractor on this award?

The obligated recipient is REED TECHNOLOGY AND INFORMATION SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Department of Commerce (U.S. Patent and Trademark Office).

What is the total obligated amount?

The obligated amount is $52.7 million.

What is the period of performance?

Start: 2016-01-27. End: 2017-01-31.

What specific publishing services are being provided under this contract?

The provided data identifies the contract as being for 'PADACAP CONTRACT (RTIS)' with a North American Industry Classification System (NAICS) code of 511199, 'All Other Publishers.' This suggests the services involve the production, management, and distribution of various published materials. Given the agency is the U.S. Patent and Trademark Office (USPTO), these services likely pertain to the publication of patents, trademark applications, official gazettes, and related intellectual property documentation. This could include data conversion, formatting, printing, electronic dissemination, and archival services necessary to make this critical information accessible to the public and stakeholders.

Why was this contract awarded on a sole-source basis instead of being competed?

The data explicitly states the contract type as 'NOT COMPETED,' indicating a sole-source award. While the specific justification is not provided in the abbreviated data, common reasons for sole-source awards include the unique capability of a single contractor, urgent and compelling needs that preclude a competitive process, or situations where only one source is capable of meeting the requirement. For the USPTO, it's possible that REED TECHNOLOGY AND INFORMATION SERVICES LLC possessed proprietary technology, specialized expertise, or existing infrastructure uniquely suited to their publishing needs, making a competitive process impractical or excessively time-consuming.

How does the average burn rate of $1,044,381.25 per week compare to the projected total need?

The average burn rate of approximately $1.04 million per week is calculated based on the projected total need of $16.71 million over a 16-week period (February 1st to May 25th, 2016). This indicates that the funds are being utilized at a pace consistent with the anticipated demand for services during that timeframe. If the burn rate were significantly higher or lower than this projection, it would suggest either an underestimation of needs or potential inefficiencies in service delivery or fund allocation. The data suggests a steady and planned expenditure aligned with the contract's initial phase.

What is the significance of the firm-fixed-price (FFP) contract type for this publishing service?

A Firm-Fixed-Price (FFP) contract type means that the contractor, REED TECHNOLOGY AND INFORMATION SERVICES LLC, is obligated to perform the work for a stated price, regardless of the actual costs incurred. This structure provides the U.S. Patent and Trademark Office with a high degree of cost certainty. The risk of cost overruns is borne by the contractor. For publishing services, where the scope of work can be relatively well-defined, FFP is a common and effective contract type for managing budgets and ensuring predictable spending. It incentivizes the contractor to control costs efficiently to maximize profit.

What are the potential risks associated with a sole-source contract of this magnitude?

Sole-source contracts, especially those valued at $52.7 million, carry inherent risks. The primary risk is the lack of price competition, which can lead to the government paying more than it would in a fully competed scenario. There's also a reduced incentive for the contractor to innovate or improve efficiency beyond what's necessary to fulfill the contract terms, as they face no direct market pressure. Furthermore, reliance on a single source can create vulnerabilities if the contractor experiences performance issues, financial instability, or faces unforeseen challenges. Oversight becomes even more critical to ensure fair pricing and adequate performance.

Industry Classification

NAICS: Information › Newspaper, Periodical, Book, and Directory Publishers › All Other Publishers

Product/Service Code: BOOKS, MAPS, OTHER PUBLICATIONS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lexisnexis Special Services Inc (UEI: 210244596)

Address: 7 WALNUT GROVE DR, HORSHAM, PA, 19044

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

Financial Breakdown

Contract Ceiling: $52,671,478

Exercised Options: $52,671,478

Current Obligation: $52,671,478

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DOC50PAPT1500003

IDV Type: IDC

Timeline