Northrop Grumman awarded $46.1M for IT support services to CDC, raising value-for-money questions
Contract Overview
Contract Amount: $46,135,565 ($46.1M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Health and Human Services
Start Date: 2014-07-31
End Date: 2018-09-30
Contract Duration: 1,522 days
Daily Burn Rate: $30.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: TIME AND MATERIALS
Sector: IT
Official Description: IGF::OT::IGF FOR OTHER FUNCTIONS INFORMATION MANAGEMENT SERVICES SUPPORT AND STATISTICAL ANALYSIS
Place of Performance
Location: ATLANTA, DEKALB County, GEORGIA, 30329
State: Georgia Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $46.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: IGF::OT::IGF FOR OTHER FUNCTIONS INFORMATION MANAGEMENT SERVICES SUPPORT AND STATISTICAL ANALYSIS Key points: 1. Contract awarded via full and open competition, suggesting a competitive process. 2. Duration of over 4 years indicates a significant, long-term need for these services. 3. The contract type (Time and Materials) can sometimes lead to cost overruns if not closely managed. 4. Services provided are critical for information management and statistical analysis at the CDC. 5. The award amount is substantial, necessitating a close look at value delivered. 6. No small business set-aside was utilized, indicating the primary contractor is a large business.
Value Assessment
Rating: fair
The total award of $46.1 million over approximately four years for IT support and statistical analysis services appears to be within a reasonable range for large-scale government contracts of this nature. However, without specific benchmarks for comparable 'Information Management Services Support and Statistical Analysis' contracts at the CDC or similar agencies, a precise value-for-money assessment is challenging. The Time and Materials pricing structure, while common, carries inherent risks of cost escalation if not meticulously monitored against performance and deliverables. Further analysis of the specific tasks performed and their efficiency would be needed to definitively gauge the value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, which typically involves a broad solicitation to all eligible responsible sources. The presence of 2 bids suggests that while competition was initiated, the number of actual bidders was limited. A higher number of bidders generally leads to more competitive pricing and a wider range of innovative solutions. The fact that only two offers were received could indicate potential barriers to entry for other firms or a highly specialized market.
Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the best value through market forces. However, with only two bidders, the potential for robust price discovery might have been constrained compared to a scenario with numerous competitive offers.
Public Impact
The Centers for Disease Control and Prevention (CDC) benefits from enhanced information management and statistical analysis capabilities. Public health initiatives and research are supported through improved data processing and insights. The contract contributes to the operational efficiency of a key federal health agency. Workforce implications include the employment of IT and data analysis professionals, primarily by the prime contractor and potentially subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Time and Materials contract type can lead to cost overruns if not managed tightly.
- Limited competition (2 bids) may have reduced price negotiation leverage.
- Lack of specific performance metrics in the provided data makes it hard to assess efficiency.
- The long duration of the contract could lead to vendor lock-in or outdated technology if not actively managed.
Positive Signals
- Awarded through full and open competition, indicating an attempt to maximize market participation.
- The contract addresses critical IT and statistical analysis needs for a vital public health agency.
- Northrop Grumman is a large, established defense and technology contractor with significant experience.
Sector Analysis
This contract falls within the Information Technology (IT) services sector, specifically focusing on computer systems design and related services. The federal IT services market is vast, with agencies consistently investing in systems to manage data, improve operations, and support mission objectives. Contracts like this are common as agencies rely on external expertise for specialized IT functions. Benchmarks for similar IT support and analysis contracts can vary widely based on scope, duration, and specific technologies involved, but this award represents a significant investment in maintaining critical data infrastructure.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). The prime contractor, Northrop Grumman Systems Corporation, is a large business. This means that small businesses would likely participate as subcontractors to Northrop Grumman, if at all. The extent of small business subcontracting is not detailed in the provided information, but large prime contracts often have subcontracting plans that aim to include small businesses.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officers and program managers within the Centers for Disease Control and Prevention (CDC). The contract's performance, adherence to terms, and financial expenditures would be subject to regular review. Depending on the specific nature of the services and potential risks, the HHS Office of Inspector General (OIG) may also conduct audits or investigations to ensure accountability and prevent fraud, waste, and abuse. Transparency is generally maintained through contract databases like FPDS, which provide public access to award details.
Related Government Programs
- CDC Information Technology Support Services
- Federal Health IT Contracts
- Government Data Analysis Services
- Northrop Grumman Federal Contracts
- Computer Systems Design Services
Risk Flags
- Potential for cost overruns due to T&M contract type.
- Limited competition may have reduced price negotiation leverage.
- Need for robust contract oversight to ensure value for money.
- Scope definition and performance monitoring are crucial for success.
Tags
it-services, health-it, statistical-analysis, northrop-grumman, department-of-health-and-human-services, centers-for-disease-control-and-prevention, full-and-open-competition, time-and-materials, large-contract, information-management, georgia, delivery-order
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $46.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. IGF::OT::IGF FOR OTHER FUNCTIONS INFORMATION MANAGEMENT SERVICES SUPPORT AND STATISTICAL ANALYSIS
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Health and Human Services (Centers for Disease Control and Prevention).
What is the total obligated amount?
The obligated amount is $46.1 million.
What is the period of performance?
Start: 2014-07-31. End: 2018-09-30.
What is the track record of Northrop Grumman Systems Corporation in delivering similar IT support and statistical analysis services to federal agencies?
Northrop Grumman Systems Corporation is a major defense contractor with extensive experience across various government sectors, including IT services, systems integration, and data analytics. They have a long history of supporting federal agencies, including health-focused organizations. While specific performance details for this particular CDC contract are not provided, Northrop Grumman generally possesses the scale and expertise to handle complex IT requirements. However, like any large contractor, their performance can vary across different contracts and agencies. Independent reviews, past performance evaluations in recompetes, and any documented issues or commendations would provide a more granular understanding of their track record on similar engagements.
How does the awarded amount of $46.1 million compare to similar IT support contracts at the CDC or other health agencies?
Comparing the $46.1 million award requires context regarding the contract's duration (over 4 years) and the specific scope of 'Information Management Services Support and Statistical Analysis.' For large-scale, multi-year IT support and data analysis contracts within federal health agencies, this amount is not inherently excessive, given the complexity and criticality of such services. However, without detailed scope-of-work comparisons and specific service delivery metrics, it's difficult to definitively benchmark. Agencies like HHS, NIH, and CMS often award contracts in the tens to hundreds of millions for comprehensive IT infrastructure and data management. The value-for-money assessment hinges on the efficiency and effectiveness of the services delivered relative to this investment.
What are the primary risks associated with a Time and Materials (T&M) contract of this magnitude and duration?
The primary risk with a Time and Materials (T&M) contract, especially one valued at $46.1 million over four years, is the potential for cost overruns. Unlike fixed-price contracts, T&M contracts pay the contractor for the actual labor hours and materials used. If not managed with rigorous oversight, including detailed tracking of hours, labor categories, and material costs, the total expenditure can exceed initial estimates or budgeted amounts. Scope creep, inefficient work practices, or extended project timelines can significantly inflate costs. For the government, this necessitates strong contract administration, clear performance standards, and regular reviews to ensure the contractor is providing efficient services and that costs remain reasonable and allocable to the defined tasks.
What does the limited number of bidders (2) for this 'full and open' competition imply for price discovery and taxpayer value?
A 'full and open' competition ideally involves numerous bidders vying for the contract, which drives down prices through market competition. When only two bids are received, it suggests that the market for this specific service might be concentrated, or that potential bidders faced barriers to entry (e.g., complex requirements, specific security clearances, or past performance prerequisites). While two bidders still provide a basis for comparison, it offers less competitive pressure than a scenario with, say, five or more offers. This could mean that the government did not achieve the lowest possible price, potentially impacting taxpayer value. It also raises questions about why more firms did not participate, which could warrant further investigation into the solicitation's structure or market dynamics.
How critical are 'Information Management Services Support and Statistical Analysis' to the CDC's mission, and what is the potential impact of service disruptions?
Information Management Services Support and Statistical Analysis are absolutely critical to the CDC's mission. The CDC relies heavily on collecting, managing, analyzing, and disseminating vast amounts of health data to track disease outbreaks, monitor public health trends, conduct research, and inform policy decisions. Disruptions in these services could severely hamper the agency's ability to respond to public health emergencies, provide accurate health statistics, or support vital research initiatives. This could lead to delayed responses to outbreaks, misinformed public health strategies, and a general erosion of the CDC's effectiveness in protecting national health.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: 2010N11852
Offers Received: 2
Pricing Type: TIME AND MATERIALS (Y)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
Address: 7575 COLSHIRE DR, MCLEAN, VA, 22102
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $46,400,781
Exercised Options: $46,400,781
Current Obligation: $46,135,565
Subaward Activity
Number of Subawards: 131
Total Subaward Amount: $83,227,489
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Parent Contract
Parent Award PIID: HHSD200201037217I
IDV Type: IDC
Timeline
Start Date: 2014-07-31
Current End Date: 2018-09-30
Potential End Date: 2018-09-30 00:00:00
Last Modified: 2018-08-07
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