DoD's Defense Information Systems Agency awards $81M contract for computer services to Knight Point Systems, LLC

Contract Overview

Contract Amount: $81,078,427 ($81.1M)

Contractor: Knight Point Systems, LLC

Awarding Agency: Department of Defense

Start Date: 2025-04-15

End Date: 2026-04-14

Contract Duration: 364 days

Daily Burn Rate: $222.7K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: CSCII - OPTION PERIOD 3

Place of Performance

Location: CHAMBERSBURG, FRANKLIN County, PENNSYLVANIA, 17201

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $81.1 million to KNIGHT POINT SYSTEMS, LLC for work described as: CSCII - OPTION PERIOD 3 Key points: 1. The contract value of $81.1 million represents a significant investment in IT services for the Defense Information Systems Agency. 2. Knight Point Systems, LLC, a relatively small contractor by some benchmarks, secured this substantial award. 3. The contract is a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle, suggesting a pre-vetted contractor. 4. The firm-fixed-price contract type indicates that the price is set regardless of the actual costs incurred by the contractor. 5. This award falls under the 'Other Computer Related Services' category, highlighting a broad scope of potential IT support. 6. The contract duration of one year (with potential for option periods) suggests a need for ongoing, but not necessarily long-term, services.

Value Assessment

Rating: fair

Benchmarking the value of this $81.1 million contract is challenging without more specific service details. However, the per-unit cost of $222,743 (based on the provided benchmark figure) for a year of service appears high for standard IT support, suggesting specialized or mission-critical functions. Comparing it to similar large-scale IT service contracts within the DoD would provide better context for value for money.

Cost Per Unit: $222,743 per unit (benchmark)

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. While the number of bidders is not specified, this method generally promotes a competitive environment, which can lead to better pricing and service offerings for the government. The fact that it was competed suggests that the agency sought the best value available in the market.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the most competitive pricing and innovative solutions, potentially reducing overall government IT expenditure.

Public Impact

The primary beneficiaries are the Department of Defense and its various components that rely on the IT services provided by DISA. Services delivered likely encompass a range of computer-related support, potentially including network management, system maintenance, cybersecurity, and software development. The geographic impact is likely nationwide, supporting DoD operations across various installations and deployed environments. Workforce implications may include the direct employment of IT professionals by Knight Point Systems, LLC, and indirectly supporting the broader defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the firm-fixed-price contract does not accurately reflect the complexity of services required.
Risk of vendor lock-in if specialized knowledge is developed exclusively by Knight Point Systems, LLC.
Dependence on a single contractor for critical IT services could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that should yield good value.
Firm-fixed-price contract type provides cost certainty for the government.
The contract is a delivery order under an IDIQ, implying that the contractor has already been vetted and deemed capable.

Sector Analysis

This contract falls within the broader IT services sector, specifically 'Other Computer Related Services' (NAICS 541519). This category includes a wide array of IT support functions not elsewhere classified, such as IT consulting, system integration, and custom software development. The federal IT services market is substantial, with agencies like the DoD being major consumers. Spending in this area is critical for maintaining operational readiness and modernizing defense infrastructure. Comparable spending benchmarks would typically involve analyzing other large IT support contracts awarded by DISA or similar defense agencies.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Knight Point Systems, LLC's size relative to the contract value is not explicitly provided, but the award amount suggests it could be a significant contract for them. There is no direct information on subcontracting plans, but for contracts of this magnitude, subcontracting to small businesses is often a component, though not mandated by a specific set-aside.

Oversight & Accountability

Oversight for this contract would primarily fall under the Defense Information Systems Agency (DISA) contracting and program management offices. Accountability measures are inherent in the firm-fixed-price contract type, requiring the contractor to deliver specified services within the agreed-upon price. Transparency is facilitated by the contract award data being publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

Defense Information Technology Contracting Organization (DITCO) contracts
IT Services for Department of Defense
Cloud Computing Services for DoD
Cybersecurity Services for Federal Government
Network Infrastructure Support Contracts

Risk Flags

Potential for cost creep if scope is not well-defined.
Contractor performance risk for specialized IT services.
Dependence on a single vendor for critical functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $81.1 million to KNIGHT POINT SYSTEMS, LLC. CSCII - OPTION PERIOD 3

Who is the contractor on this award?

The obligated recipient is KNIGHT POINT SYSTEMS, 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 $81.1 million.

What is the period of performance?

Start: 2025-04-15. End: 2026-04-14.

What is the track record of Knight Point Systems, LLC with the federal government, particularly with the Department of Defense?

Assessing the track record of Knight Point Systems, LLC requires a review of their past federal contract awards and performance history. Information from sources like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS) would be crucial. Key metrics to examine include the number and value of previous contracts, the agencies they have served, and any reported performance issues or commendations. A history of successful contract completion, particularly with complex IT services for defense agencies, would indicate a lower risk profile for this current award. Conversely, a history of performance problems or contract disputes could raise concerns about the reliability and effectiveness of the contractor.

How does the $81.1 million contract value compare to similar IT services contracts awarded by DISA or other DoD components?

To benchmark the $81.1 million value, one would compare it against recent awards for similar 'Other Computer Related Services' (NAICS 541519) or broader IT support contracts issued by DISA and other Department of Defense agencies. Factors such as contract duration, scope of work (e.g., network management, cybersecurity, software development), and the specific services required are critical for a meaningful comparison. If this contract represents a typical or below-market price for comparable services and scope, it suggests good value. If it is significantly higher than similar contracts, it may indicate potential overpricing or a more complex, specialized service requirement. Publicly available contract databases are essential for this comparative analysis.

What are the primary risks associated with this firm-fixed-price contract for 'Other Computer Related Services'?

The primary risks associated with this firm-fixed-price contract revolve around the potential for the contractor to either underperform or overcharge relative to the actual effort required. For the government, a key risk is that the fixed price may not adequately account for unforeseen complexities or scope creep, potentially leading to a demand for contract modifications or a reduction in service quality if the contractor cannot absorb additional costs. Conversely, if the contractor significantly underestimates the effort, they might cut corners on service delivery to maintain profitability. Another risk is the potential for the contractor to lack the necessary specialized expertise for certain aspects of 'Other Computer Related Services,' leading to suboptimal outcomes. Robust government oversight and clear performance metrics are crucial to mitigate these risks.

How effective is the 'full and open competition' process likely to be in ensuring optimal value for this $81.1 million IT services contract?

The 'full and open competition' process is designed to maximize value by encouraging a wide range of potential bidders to submit proposals, thereby fostering price competition and innovation. For an $81.1 million IT services contract, this approach should theoretically lead to the government receiving competitive bids that reflect fair market value. The effectiveness hinges on several factors: the clarity and completeness of the solicitation documents, the number and quality of the bidders that respond, and the evaluation criteria used by the agency. If the competition is robust, with multiple capable vendors submitting strong proposals, it significantly increases the likelihood of securing optimal value. However, if the solicitation is poorly defined or only a few vendors can meet the requirements, the competitive advantage may be diminished.

What are the historical spending patterns for 'Other Computer Related Services' by the Defense Information Systems Agency?

Analyzing historical spending patterns for 'Other Computer Related Services' by DISA would involve examining contract awards over several fiscal years. This would reveal trends in contract values, the types of services most frequently procured under this NAICS code, and the primary contractors receiving awards. Understanding these patterns can help identify whether spending has been consistent, increasing, or decreasing, and whether it aligns with broader DoD IT modernization goals. It can also highlight any shifts in the types of services being prioritized, such as a move towards cloud services, cybersecurity, or data analytics. Such analysis provides context for the current $81.1 million award, indicating if it is within the expected range of DISA's historical IT service procurements.

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: HC102816R0012

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1775 WIEHLE AVE STE 101, RESTON, VA, 20190

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Service Disabled Veteran Owned Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $81,078,427

Exercised Options: $81,078,427

Current Obligation: $81,078,427

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $702,745

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HC102818D0041

IDV Type: IDC

Timeline