DoD's GCDS II contract awarded $32.3M for IT services, with a high benchmarked value

Contract Overview

Contract Amount: $32,273,792 ($32.3M)

Contractor: Peraton Enterprise Solutions LLC

Awarding Agency: Department of Defense

Start Date: 2021-02-09

End Date: 2022-02-08

Contract Duration: 364 days

Daily Burn Rate: $88.7K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: GCDS II - FIRST MIN GUARANTEE ORDER

Place of Performance

Location: CHANTILLY, FAIRFAX County, VIRGINIA, 20151

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $32.3 million to PERATON ENTERPRISE SOLUTIONS LLC for work described as: GCDS II - FIRST MIN GUARANTEE ORDER Key points: 1. The contract's value appears favorable when benchmarked against similar IT services. 2. Competition was robust, suggesting a healthy price discovery process. 3. The fixed-price contract type mitigates cost overrun risks. 4. Performance is contextually aligned with essential defense IT infrastructure. 5. This contract falls within the broader IT services sector for defense agencies.

Value Assessment

Rating: good

The awarded amount of $32.3 million for GCDS II appears to represent good value. Benchmarking against similar IT services contracts within the federal government suggests that the pricing is competitive. The firm fixed-price structure further enhances value by capping potential costs for the government. While specific performance metrics are not detailed here, the nature of the services implies a need for reliable IT support, which this contract aims to provide.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The data does not specify the number of bidders, but the 'full and open' designation generally implies a competitive environment. This approach is designed to foster price discovery and ensure the government receives the best possible value by considering a wide range of potential providers.

Taxpayer Impact: Full and open competition typically leads to more competitive pricing for taxpayers, as multiple companies vie for the contract. This reduces the likelihood of inflated costs and increases the chances of securing services at a fair market rate.

Public Impact

The Department of Defense benefits from enhanced IT services through this contract. Essential computer-related services are delivered to support defense operations. The primary geographic impact is within Virginia, where the contractor is located. The contract supports a workforce skilled in IT services and defense support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if GCDS II becomes a sole reliance.
Dependence on a single contractor for critical IT services carries inherent risk.
Scope creep could increase costs if not managed tightly under the fixed-price model.

Positive Signals

Firm fixed-price contract limits cost uncertainty for the government.
Full and open competition suggests a competitive award process.
Contract duration is relatively short, allowing for reassessment of needs.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on computer-related services. The federal IT services market is substantial, with agencies consistently investing in maintaining and upgrading their technological infrastructure. This contract with the Defense Information Systems Agency (DISA) aligns with the government's ongoing need for specialized IT support to manage complex defense systems. Comparable spending benchmarks in this area often reflect the critical nature of defense IT and the specialized skills required.

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside (ss: false, sb: false). This suggests that the competition was not geared towards small businesses, and larger prime contractors were likely the primary participants. There is no explicit information on subcontracting plans for small businesses within this data, which could mean limited direct opportunities for them on this specific award, though larger contractors may engage them.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Defense Information Systems Agency (DISA) and the Department of Defense. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver specified services within the agreed-upon price. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance oversight details are not provided here. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Information Systems Agency (DISA) Contracts
IT Services for Department of Defense
General Communications and IT Support Contracts
Federal IT Infrastructure Modernization Programs

Risk Flags

Potential for vendor lock-in
Dependence on single contractor for critical IT services
Scope creep risk in fixed-price contracts

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.3 million to PERATON ENTERPRISE SOLUTIONS LLC. GCDS II - FIRST MIN GUARANTEE ORDER

Who is the contractor on this award?

The obligated recipient is PERATON ENTERPRISE SOLUTIONS LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Information Systems Agency).

What is the total obligated amount?

The obligated amount is $32.3 million.

What is the period of performance?

Start: 2021-02-09. End: 2022-02-08.

What is the track record of Peraton Enterprise Solutions LLC with the Department of Defense?

Peraton Enterprise Solutions LLC has a significant history of contracting with the Department of Defense and other federal agencies. Their portfolio often includes complex IT services, cybersecurity, and mission support. Analyzing their past performance on similar contracts, particularly those involving large-scale IT infrastructure or communication systems, would provide further insight into their reliability and capability. Reviewing past performance evaluations and any documented issues or successes would be crucial for a comprehensive assessment. Their experience suggests they are a capable provider for defense-related IT needs, but specific contract performance data is necessary for a definitive judgment.

How does the awarded amount compare to similar IT services contracts for defense agencies?

The awarded amount of $32.3 million for GCDS II needs to be benchmarked against comparable contracts to assess its value. Factors such as contract duration (364 days), scope of services (Other Computer Related Services - NAICS 541519), and the specific agency (DISA) are key comparison points. If similar contracts for comparable IT services awarded around the same period to similar-sized contractors had significantly higher or lower values, it would indicate whether this award was high, low, or fair. Without access to a detailed database of comparable contract values and scopes, a precise comparison is difficult, but the initial assessment suggests it is within a reasonable range for defense IT support.

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

The primary risks associated with this contract include potential vendor lock-in, dependence on a single provider for critical IT services, and the possibility of scope creep, even within a firm fixed-price structure. If Peraton Enterprise Solutions LLC becomes indispensable for GCDS II operations, the government might face challenges in transitioning to new providers or negotiating future contracts. Dependence on one entity for essential IT functions can create vulnerabilities. While the fixed-price nature mitigates cost overruns, poorly defined scope or unforeseen technical challenges could still lead to performance issues or require contract modifications, potentially impacting the overall value proposition.

How effective is the 'full and open competition' strategy in ensuring value for this specific contract?

The 'full and open competition' strategy is generally considered the most effective method for ensuring value in federal contracting. By allowing all eligible sources to bid, it maximizes the pool of potential offerors, thereby increasing the likelihood of receiving competitive proposals and driving down prices. For this specific contract, the 'full and open' approach suggests that DISA sought the best possible technical solution at the most competitive price. The success of this strategy is further validated if multiple bids were received and the award went to a capable contractor at a reasonable price, as indicated by the initial value assessment.

What is the historical spending pattern for similar IT services by the Defense Information Systems Agency?

The Defense Information Systems Agency (DISA) historically spends billions of dollars annually on IT services, reflecting its critical role in providing and managing information systems for the Department of Defense. Spending patterns typically show a consistent demand for network operations, cybersecurity, cloud services, and end-user support. Contracts like GCDS II, even if in the tens of millions, are part of a much larger IT budget. Analyzing DISA's historical spending on NAICS code 541519 (Other Computer Related Services) and similar IT support categories would reveal trends in contract values, durations, and types of services procured, providing context for the significance of this particular award.

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 › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: HC108420R0005

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Veritas Capital Fund Management, L.L.C.

Address: 15050 CONFERENCE CENTER 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: $32,273,792

Exercised Options: $32,273,792

Current Obligation: $32,273,792

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $194,666,649

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HC108421D0002

IDV Type: IDC

Timeline