DoD's $24.16M ServiceNow License Purchase via BPA Call Raises Questions on Value and Competition
Contract Overview
Contract Amount: $24,161,435 ($24.2M)
Contractor: CACI NSS, LLC
Awarding Agency: Department of Defense
Start Date: 2025-06-12
End Date: 2025-12-15
Contract Duration: 186 days
Daily Burn Rate: $129.9K/day
Competition Type: COMPETED UNDER SAP
Number of Offers Received: 4
Pricing Type: TIME AND MATERIALS
Sector: IT
Official Description: EITAAS WAVE 1 - SERVICENOW LICENSES
Place of Performance
Location: CHANTILLY, FAIRFAX County, VIRGINIA, 20151
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $24.2 million to CACI NSS, LLC for work described as: EITAAS WAVE 1 - SERVICENOW LICENSES Key points: 1. Significant spending on IT licenses for a critical system. 2. Competition was limited to a BPA Call, potentially impacting price discovery. 3. Risk of overpayment exists due to Time and Materials contract type. 4. IT sector spending benchmark analysis needed for comparable contracts.
Value Assessment
Rating: questionable
The $24.16M for ServiceNow licenses is substantial. Without a clear per-unit cost or comparison to similar government or commercial contracts, assessing value is difficult. The Time and Materials contract type introduces risk for cost overruns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was competed under SAP via a BPA Call, indicating limited competition. While a BPA Call allows for some competition among pre-qualified vendors, it's less competitive than an open solicitation, potentially leading to higher prices.
Taxpayer Impact: The limited competition and T&M contract type may result in taxpayers paying more than necessary for these software licenses.
Public Impact
Ensures operational continuity for Air Force systems relying on ServiceNow. Potential for cost savings if pricing is benchmarked against industry standards. Transparency in contract modifications and vendor performance is crucial.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition via BPA Call
- Time and Materials contract type
- Lack of clear per-unit cost benchmark
Positive Signals
- Procurement through an existing BPA
- Defined contract duration
Sector Analysis
This spending falls within the IT sector, specifically computer systems design services. Government spending on enterprise software licenses like ServiceNow is common, but benchmarks are essential to ensure fair pricing, especially given the trend towards cloud-based solutions.
Small Business Impact
The data does not indicate any specific set-asides for small businesses. The prime contractor, CACI NSS, LLC, is a large business, suggesting limited direct opportunities for small businesses in this specific contract award.
Oversight & Accountability
Oversight will be critical to monitor expenditures under this Time and Materials contract. The Air Force should ensure rigorous review of invoices and performance to prevent cost overruns and ensure value for money.
Related Government Programs
- Computer Systems Design Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for cost overruns due to T&M contract.
- Limited competition may lead to non-optimal pricing.
- Lack of detailed cost breakdown for licenses.
- Need for robust performance monitoring.
Tags
computer-systems-design-services, department-of-defense, va, bpa-call, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $24.2 million to CACI NSS, LLC. EITAAS WAVE 1 - SERVICENOW LICENSES
Who is the contractor on this award?
The obligated recipient is CACI NSS, LLC.
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 $24.2 million.
What is the period of performance?
Start: 2025-06-12. End: 2025-12-15.
What is the average per-unit cost for ServiceNow licenses of this type across similar government contracts?
Determining the average per-unit cost requires access to a broader dataset of government IT procurements. However, industry benchmarks for ServiceNow enterprise licenses can range significantly based on modules, user count, and support levels. A typical range might be from $50 to $300 per user per month, but this is highly variable and requires specific contract details for accurate comparison.
What are the specific risks associated with using a Time and Materials contract for software licenses?
Time and Materials (T&M) contracts for software licenses carry inherent risks of cost escalation. Unlike fixed-price contracts, T&M allows the vendor to bill for actual labor hours and material costs incurred. This can lead to unpredictable final costs if not closely monitored, potentially exceeding initial estimates and offering less incentive for vendor efficiency.
How does the limited competition via a BPA Call impact the government's ability to secure the best possible price?
Limited competition, even within a Best Practices Agreement (BPA) Call, can reduce the government's leverage in price negotiations. While BPAs streamline procurement, competition is typically restricted to pre-qualified vendors. This can result in prices that are not as competitive as those achievable through a full and open solicitation, where a wider range of vendors can bid.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: IT AND TELECOM - END USER
Competition & Pricing
Extent Competed: COMPETED UNDER SAP
Solicitation Procedures: SIMPLIFIED ACQUISITION
Offers Received: 4
Pricing Type: TIME AND MATERIALS (Y)
Evaluated Preference: NONE
Contractor Details
Parent Company: CACI International Inc
Address: 14370 NEWBROOK DR, 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: $24,161,435
Exercised Options: $24,161,435
Current Obligation: $24,161,435
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA872622A0001
IDV Type: BPA
Timeline
Start Date: 2025-06-12
Current End Date: 2025-12-15
Potential End Date: 2025-12-15 00:00:00
Last Modified: 2025-08-22
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