DoD's $14.3M IT services contract with MELE ASSOCIATES INC shows fair value, but limited competition raises concerns

Contract Overview

Contract Amount: $14,309,445 ($14.3M)

Contractor: Mele Associates Inc

Awarding Agency: Department of Defense

Start Date: 2006-07-17

End Date: 2011-06-30

Contract Duration: 1,809 days

Daily Burn Rate: $7.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SUBJECT MATTER EXPERTS

Place of Performance

Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22041

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $14.3 million to MELE ASSOCIATES INC for work described as: SUBJECT MATTER EXPERTS Key points: 1. Contract value appears reasonable given the duration and services provided. 2. Competition was limited, potentially impacting price discovery and value for money. 3. Risk indicators are moderate, with no major red flags identified in the available data. 4. Performance context suggests a long-term engagement for specialized IT services. 5. This contract fits within the broader IT services sector for government support. 6. The firm fixed-price structure offers cost certainty for the government.

Value Assessment

Rating: fair

The contract's total value of $14.3 million over approximately five years suggests an average annual spend of around $2.86 million. Benchmarking this against similar IT services contracts for the Department of Defense is challenging without more specific service details. However, the firm fixed-price nature indicates that the contractor assumed the risk for cost overruns, which can be a positive indicator of value if the scope was well-defined. The number of bids received (2) is low, which could suggest either a highly specialized service or a lack of robust competition, potentially leading to less favorable pricing than a more competitive scenario might yield.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. However, only two bids were received. This limited number of bidders, despite open competition, could indicate a niche market, high barriers to entry for potential competitors, or a lack of outreach by the agency. While the process was open, the low bid count suggests that the government may not have benefited from the full spectrum of market competition, potentially impacting the final price and innovation.

Taxpayer Impact: A low number of bidders, even under full and open competition, means taxpayers may not have received the most competitive pricing possible. This could translate to higher costs for the services rendered compared to a scenario with more active bidding.

Public Impact

The Department of Defense benefits from specialized IT services supporting its operations. Services delivered likely include computer systems design, integration, and related technical support. The geographic impact is primarily within the agency's operational locations, likely supporting military and civilian personnel. Workforce implications include the employment of IT professionals by MELE ASSOCIATES INC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may have resulted in suboptimal pricing for taxpayers.
Lack of detailed performance metrics makes it difficult to assess service quality definitively.
The long contract duration could lead to vendor lock-in if not managed carefully.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Awarded under full and open competition, adhering to procurement regulations.
MELE ASSOCIATES INC. has a track record of performing government contracts.

Sector Analysis

The IT services sector for the federal government is vast and highly competitive, encompassing a wide range of services from software development to cybersecurity and infrastructure management. This contract, categorized under 'Other Computer Related Services' (NAICS 541519), falls within this broad sector. Government spending in IT services is consistently high as agencies modernize systems and enhance digital capabilities. Comparable spending benchmarks would depend heavily on the specific nature of the 'Other Computer Related Services' provided, but the $14.3 million over five years is a moderate-sized contract within the federal IT landscape.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' flag is also false, suggesting no specific small business subcontracting goals were mandated for this particular award. This means that opportunities for small businesses to participate in this contract, either as prime contractors or subcontractors, were not explicitly prioritized through set-aside provisions. The impact on the small business ecosystem is neutral to potentially negative if subcontracting opportunities were not actively pursued by the prime contractor.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program management office within the Department of the Air Force. Accountability measures are inherent in the firm fixed-price contract type, requiring MELE ASSOCIATES INC. to deliver specified services within the agreed-upon price. Transparency is generally facilitated through contract databases like FPDS. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's performance.

Related Government Programs

IT Professional Services
Computer Systems Design Services
Defense Information Technology
Air Force IT Support
Government IT Services

Risk Flags

Limited competition despite full and open award
Potential for suboptimal pricing due to low bid count

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.3 million to MELE ASSOCIATES INC. SUBJECT MATTER EXPERTS

Who is the contractor on this award?

The obligated recipient is MELE ASSOCIATES INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $14.3 million.

What is the period of performance?

Start: 2006-07-17. End: 2011-06-30.

What is the specific nature of the 'Other Computer Related Services' provided under this contract?

The provided data indicates the NAICS code is 541519, 'Other Computer Related Services.' This is a broad category that can encompass a wide array of IT support functions beyond standard software development or hardware installation. Examples might include IT consulting, disaster recovery services, data processing services, IT support for specialized systems, or IT project management. Without further details from the contract's statement of work, it's difficult to pinpoint the exact services. However, given the duration and value, it likely involves ongoing, specialized technical support or system integration services crucial to the Department of Defense's operations.

How does the pricing of this contract compare to similar IT services contracts awarded by the Department of Defense?

Direct price comparison is challenging without knowing the precise services rendered. However, the average annual value of approximately $2.86 million ($14.3M / 5 years) for specialized IT support is within a typical range for federal contracts of this nature. The key factor influencing value is the level of competition. With only two bids received, the pricing might be higher than if more vendors had competed. A more thorough analysis would involve benchmarking against contracts with similar scope, duration, and complexity, ideally those awarded under more competitive conditions, to ascertain if the government received optimal market pricing.

What are the primary risks associated with this contract for the government?

The primary risks for the government revolve around the limited competition and the potential for vendor lock-in. With only two bidders, there's a risk that the chosen vendor, MELE ASSOCIATES INC., may not have offered the most competitive price, leading to potential overspending. Additionally, if the services are highly specialized and integrated into the agency's operations, switching vendors in the future could be costly and disruptive. Ensuring clear performance metrics and maintaining strong oversight are crucial to mitigate these risks and ensure continued value delivery throughout the contract's life.

What is MELE ASSOCIATES INC.'s track record with federal contracts, particularly within the Department of Defense?

MELE ASSOCIATES INC. has a history of performing federal contracts, including those with the Department of Defense. The data indicates this specific contract was awarded in 2006 and completed in 2011, suggesting a past performance record. A comprehensive assessment of their track record would involve reviewing past performance evaluations, any documented issues or disputes on previous contracts, and their overall success rate in winning and executing government work. Without access to detailed performance reports, it's assumed they successfully completed this $14.3 million contract based on its completion status.

How has federal spending on 'Other Computer Related Services' (NAICS 541519) evolved over the period this contract was active and subsequently?

Federal spending on 'Other Computer Related Services' (NAICS 541519) has generally seen a consistent increase over the years, driven by the government's continuous need for IT modernization, cybersecurity enhancements, and specialized technical support. During the period this contract was active (2006-2011), agencies were increasingly relying on external expertise for complex IT challenges. Post-2011, this trend has accelerated with the rise of cloud computing, big data analytics, and advanced cyber threats, further boosting demand for services under this NAICS code. This indicates a stable and growing market for the services MELE ASSOCIATES INC. provided.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11 TAFT CT, ROCKVILLE, MD, 20850

Business Categories: Category Business, Small Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $14,739,851

Exercised Options: $14,309,445

Current Obligation: $14,309,445

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F4647G

IDV Type: FSS

Timeline