DoD's $40.2M contract for NIPRNET & SIPRNET readiness awarded to Peraton Enterprise Solutions LLC

Contract Overview

Contract Amount: $40,207,750 ($40.2M)

Contractor: Peraton Enterprise Solutions LLC

Awarding Agency: Department of Defense

Start Date: 2023-02-09

End Date: 2024-02-08

Contract Duration: 364 days

Daily Burn Rate: $110.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: NIPRNET & SIPRNET CAPABILITY READINESS

Place of Performance

Location: CHANTILLY, FAIRFAX County, VIRGINIA, 20151

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $40.2 million to PERATON ENTERPRISE SOLUTIONS LLC for work described as: NIPRNET & SIPRNET CAPABILITY READINESS Key points: 1. Contract value represents a significant investment in maintaining critical defense communication networks. 2. The award was made under full and open competition, suggesting a competitive bidding process. 3. Fixed-price contract type aims to control costs and provide predictable spending. 4. The contract duration of one year allows for agile adaptation to evolving network needs. 5. This spending supports the operational readiness of the Department of Defense's secure networks.

Value Assessment

Rating: good

The contract value of $40.2 million for one year of NIPRNET & SIPRNET capability readiness appears reasonable given the critical nature of these defense communication systems. Benchmarking against similar large-scale IT support contracts for defense agencies suggests that pricing is likely competitive, especially considering the full and open competition. The firm fixed-price structure further supports value for money by shifting cost overrun risks to the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified vendors were allowed to bid. The specific number of bidders is not provided, but this procurement method generally fosters price discovery and encourages competitive pricing. The Defense Information Systems Agency (DISA) likely sought the best value solution through a robust bidding process.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the most cost-effective solution for essential defense network readiness, preventing potential overpayment.

Public Impact

The primary beneficiaries are the Department of Defense (DoD) personnel who rely on secure and reliable NIPRNET and SIPRNET for daily operations. The contract ensures the continued readiness and operational capability of vital military communication networks. Geographic impact is nationwide, supporting DoD installations and personnel across various locations. Workforce implications include potential employment opportunities for IT specialists and support staff within Peraton Enterprise Solutions LLC and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if follow-on contracts are not competitively bid.
Reliance on a single contractor for critical network readiness could pose a risk if performance issues arise.
The scope of 'capability readiness' could be broad, requiring careful monitoring to ensure all deliverables are met.

Positive Signals

Awarded through full and open competition, indicating a competitive market for these services.
Firm fixed-price contract type provides cost certainty for the government.
Contract duration of one year allows for flexibility and reassessment of needs.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on network operations and readiness for defense applications. The market for defense IT support is substantial, with agencies like DISA being major consumers. Spending benchmarks for similar network support and cybersecurity contracts within the federal government can range from tens to hundreds of millions of dollars annually, depending on scope and duration. This contract appears to be a mid-sized award within this specialized segment.

Small Business Impact

The contract was awarded to Peraton Enterprise Solutions LLC, a large business. There is no explicit indication of small business set-asides for this specific delivery order. However, large prime contractors are often required to meet subcontracting goals with small businesses. The impact on the small business ecosystem will depend on Peraton's subcontracting plan and opportunities within this contract's scope.

Oversight & Accountability

Oversight for this contract is likely managed by the Defense Information Systems Agency (DISA) contracting officers and program managers. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified capabilities. Transparency is generally maintained through contract award databases, though specific performance metrics may not be publicly disclosed. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

DoD Network Modernization Programs
Defense Information Systems Network (DISN) Operations
Cybersecurity Support Services for DoD
IT Infrastructure Support Contracts

Risk Flags

Contract performance risk
Vendor lock-in potential
Scope definition clarity

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $40.2 million to PERATON ENTERPRISE SOLUTIONS LLC. NIPRNET & SIPRNET CAPABILITY READINESS

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 $40.2 million.

What is the period of performance?

Start: 2023-02-09. End: 2024-02-08.

What is Peraton Enterprise Solutions LLC's track record with similar DoD IT contracts?

Peraton Enterprise Solutions LLC has a significant history of performing IT and telecommunications services for the Department of Defense and other federal agencies. They have held numerous large-scale contracts related to network operations, cybersecurity, and enterprise IT solutions. Their experience often includes managing complex, mission-critical systems similar to NIPRNET and SIPRNET. While specific performance metrics for past contracts are not detailed here, their continued awards suggest a generally satisfactory performance history. However, a deeper dive into past performance reviews and any documented issues would provide a more comprehensive assessment of their reliability for this specific contract.

How does the $40.2 million value compare to previous spending on NIPRNET/SIPRNET readiness?

Analyzing historical spending requires access to detailed budget data for NIPRNET and SIPRNET readiness over multiple fiscal years. The $40.2 million for this one-year contract represents a specific investment in 'capability readiness.' Without comparative data on the scope and duration of previous readiness efforts, it's difficult to definitively state if this amount is higher or lower than historical averages. However, given the increasing complexity and cyber threats to defense networks, it is plausible that spending in this area could trend upwards or remain substantial to ensure adequate preparedness. This figure should be viewed in the context of the overall DoD IT budget.

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

Key risks include potential performance shortfalls by the contractor, leading to degraded network readiness or security vulnerabilities. Dependence on a single vendor for critical readiness could create a vulnerability if the contractor faces financial instability or operational challenges. Scope creep, where the definition of 'capability readiness' expands beyond the original intent without corresponding budget adjustments, is another risk. Furthermore, ensuring that the contractor maintains up-to-date knowledge of evolving threats and technologies relevant to NIPRNET and SIPRNET is crucial. The firm fixed-price nature, while good for cost control, could incentivize the contractor to cut corners on quality if not rigorously overseen.

How effective is the firm fixed-price (FFP) contract type in ensuring value for money for this type of service?

The firm fixed-price contract type is generally considered effective for ensuring value for money when the scope of work is well-defined and requirements are not expected to change significantly. For NIPRNET & SIPRNET capability readiness, FFP shifts the risk of cost overruns to the contractor, incentivizing them to manage resources efficiently. This provides cost certainty for the government. However, if the 'readiness' requirements are highly dynamic or subject to rapid technological shifts, an FFP contract might limit flexibility or potentially lead to the contractor resisting necessary changes unless additional funding is negotiated. Robust performance monitoring is still essential to ensure the contractor is not sacrificing quality to meet the fixed price.

What does the 'Other Computer Related Services' NAICS code (541519) imply about the contract's scope?

The NAICS code 541519, 'Other Computer Related Services,' is a broad category that encompasses a wide range of IT services not classified under more specific codes. This implies the contract could involve activities such as IT consulting, systems integration, disaster recovery services, IT support, and potentially aspects of network management and readiness that don't fit neatly into categories like software development or data processing. For NIPRNET & SIPRNET capability readiness, this code suggests the contract likely focuses on the operational and support aspects of maintaining these networks, rather than the development of new core technologies. It indicates a focus on ensuring the existing systems are functional, secure, and prepared for operational demands.

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

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: $40,207,750

Exercised Options: $40,207,750

Current Obligation: $40,207,750

Actual Outlays: $22,424,360

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