GSA Spends $19.5M on Enterprise Server Outsourcing, Leidos Wins Contract

Contract Overview

Contract Amount: $19,526,416 ($19.5M)

Contractor: Leidos Information Technology Commercial Corporation

Awarding Agency: General Services Administration

Start Date: 2011-10-01

End Date: 2014-09-30

Contract Duration: 1,095 days

Daily Burn Rate: $17.8K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: ENTERPRISE SERVER OUTSOURCING MAINFRAME SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20417

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $19.5 million to LEIDOS INFORMATION TECHNOLOGY COMMERCIAL CORPORATION for work described as: ENTERPRISE SERVER OUTSOURCING MAINFRAME SERVICES Key points: 1. Significant expenditure on mainframe services highlights reliance on legacy systems. 2. Sole-source award to Leidos raises questions about competition and potential cost savings. 3. Contract duration of three years suggests a long-term commitment to this provider. 4. Lack of small business participation noted, potentially limiting broader economic impact.

Value Assessment

Rating: fair

The contract value of $19.5M over three years for mainframe services is substantial. Without comparable contract data or detailed cost breakdowns, it's difficult to definitively assess if this pricing is competitive. Benchmarking against industry standards for similar outsourcing agreements would be necessary.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was awarded on a sole-source basis, indicating a lack of competitive bidding. This method can lead to higher prices as there is no market pressure to offer the best value. The absence of competition limits price discovery and potentially reduces opportunities for innovation from other vendors.

Taxpayer Impact: The $19.5M expenditure represents taxpayer funds allocated to a single vendor without a competitive process, potentially leading to suboptimal value for money.

Public Impact

Citizens rely on government services that may be underpinned by these mainframe systems. The use of outsourcing for critical IT infrastructure impacts government's internal IT capabilities. Lack of transparency in sole-source awards can erode public trust in government spending.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
No small business participation

Positive Signals

Firm fixed price contract type can provide cost certainty

Sector Analysis

This contract falls under IT consulting services, specifically focusing on enterprise server outsourcing and mainframe operations. The spending benchmark for such services can vary widely based on complexity and scale, but $19.5M over three years for a single agency suggests a significant, specialized requirement.

Small Business Impact

The data indicates that small businesses were not involved in this contract (ss=false, sb=false). This suggests that the scope of work or the contracting vehicle used did not facilitate small business participation, potentially missing opportunities to leverage specialized small business capabilities.

Oversight & Accountability

The General Services Administration (GSA) is responsible for overseeing this contract. The sole-source nature of the award warrants scrutiny to ensure the justification for not competing was robust and that the pricing is reasonable. Further oversight would involve reviewing performance metrics and vendor management.

Related Government Programs

Other Scientific and Technical Consulting Services
General Services Administration Contracting
Office of the Administrator Programs

Risk Flags

Sole-source award lacks competition
Potential for inflated pricing due to no competition
No small business participation
Reliance on legacy mainframe systems
Limited transparency in contract award

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $19.5 million to LEIDOS INFORMATION TECHNOLOGY COMMERCIAL CORPORATION. ENTERPRISE SERVER OUTSOURCING MAINFRAME SERVICES

Who is the contractor on this award?

The obligated recipient is LEIDOS INFORMATION TECHNOLOGY COMMERCIAL CORPORATION.

Which agency awarded this contract?

Awarding agency: General Services Administration (Office of the Administrator).

What is the total obligated amount?

The obligated amount is $19.5 million.

What is the period of performance?

Start: 2011-10-01. End: 2014-09-30.

What was the specific justification for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?

The justification for a sole-source award typically involves unique capabilities, urgent needs, or a lack of available sources. Without further documentation, it's unclear why competition was bypassed. Agencies are expected to explore competitive options thoroughly, and a sole-source award should be a last resort, requiring strong justification to ensure taxpayer funds are used efficiently and effectively.

How does the per-unit cost or overall pricing compare to industry benchmarks for similar mainframe outsourcing services?

Benchmarking this $19.5M contract against industry standards is challenging without specific details on the services provided (e.g., processing power, storage, support levels). However, given the significant expenditure and lack of competition, a thorough review against market rates for comparable mainframe outsourcing contracts is crucial to determine if the government received fair value.

What are the long-term implications of outsourcing mainframe services, particularly regarding data security, vendor lock-in, and modernization efforts?

Outsourcing critical mainframe functions can lead to vendor lock-in, making it difficult and costly to switch providers or modernize systems later. It also raises concerns about data security and control. Agencies must carefully weigh these risks against potential cost savings or specialized expertise offered by the vendor, ensuring robust security protocols and exit strategies are in place.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Other Scientific and Technical Consulting Services

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

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 3114 LORD BALTIMORE DR STE 201, BALTIMORE, MD, 90

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

Financial Breakdown

Contract Ceiling: $19,526,416

Exercised Options: $19,526,416

Current Obligation: $19,526,416

Contract Characteristics

Cost or Pricing Data: NO

Timeline