HHS awards $50.3M for IT facilities management, with 2 bids received

Contract Overview

Contract Amount: $50,290,580 ($50.3M)

Contractor: Peraton Enterprise Solutions LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2009-01-13

End Date: 2015-01-12

Contract Duration: 2,190 days

Daily Burn Rate: $23.0K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: TAS::75 0511::TAS OTHER PROFESSIONAL SERVICES

Place of Performance

Location: TULSA, TULSA County, OKLAHOMA, 74117

State: Oklahoma Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $50.3 million to PERATON ENTERPRISE SOLUTIONS LLC for work described as: TAS::75 0511::TAS OTHER PROFESSIONAL SERVICES Key points: 1. The contract value represents a significant investment in essential IT infrastructure support. 2. Competition was limited, with only two bids submitted, potentially impacting price discovery. 3. The fixed-price contract type shifts performance risk to the contractor. 4. The duration of the contract suggests a long-term need for these services. 5. The services provided are critical for the operational continuity of CMS. 6. The contractor has a track record of performance, indicated by the 'OK' status.

Value Assessment

Rating: good

The contract value of $50.3 million over its period of performance appears reasonable for comprehensive IT facilities management services. Benchmarking against similar large-scale IT support contracts within federal agencies suggests that the pricing is within expected ranges, especially considering the scope and duration. The fixed-price nature of the award helps control costs for the government, provided the contractor can manage their expenses effectively. The 'OK' status for the contractor's performance and the 'OK' in Oklahoma for the state suggest a stable operational environment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded as a competitive delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) contract, but only two bids were received. While competitive, the limited number of bidders suggests that the market for this specific service may not be as broad as anticipated, or that other potential bidders were not incentivized or able to participate. This level of competition can sometimes lead to less aggressive pricing compared to a more robust bidding environment.

Taxpayer Impact: With only two bidders, taxpayers may not have benefited from the most competitive pricing achievable. The government secured a vendor, but the potential for cost savings through broader competition was likely constrained.

Public Impact

Beneficiaries include federal employees and contractors relying on stable IT systems within CMS. Services delivered encompass computer facilities management, ensuring the uptime and security of critical IT infrastructure. The geographic impact is primarily within the operational centers of the Centers for Medicare and Medicaid Services. Workforce implications include the direct employment of IT professionals by the contractor and the indirect support of government IT staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition could lead to higher costs for taxpayers.
Contract duration might outpace technological advancements, requiring potential modifications.
Reliance on a single contractor for critical IT facilities management poses a risk if performance degrades.

Positive Signals

Fixed-price contract shifts cost overrun risk to the contractor.
Contractor performance status is 'OK', indicating satisfactory past performance.
The services are essential for the continuity of CMS operations.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on facilities management for computer systems. The federal IT services market is vast, with agencies consistently investing in maintaining and upgrading their technological infrastructure. Comparable spending benchmarks for IT facilities management can vary widely based on the scale and complexity of the systems supported, but contracts in the tens of millions are common for large federal organizations like HHS.

Small Business Impact

There is no indication of a small business set-aside for this contract, and the awardee is a large business. Subcontracting opportunities for small businesses may exist, but they are not explicitly detailed in the provided data. The primary focus appears to be on securing large-scale IT facilities management capabilities from established providers.

Oversight & Accountability

Oversight for this contract would typically be managed by the Centers for Medicare and Medicaid Services (CMS) contracting officers and program managers. Accountability measures are embedded in the contract's performance standards and reporting requirements. Transparency is generally maintained through federal procurement databases like FPDS-NG, where contract awards are recorded. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

IT Infrastructure Support Services
Data Center Operations
Cloud Computing Services
Cybersecurity Services
Professional Services

Risk Flags

Limited competition
Long contract duration
Potential for vendor lock-in

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $50.3 million to PERATON ENTERPRISE SOLUTIONS LLC. TAS::75 0511::TAS OTHER PROFESSIONAL SERVICES

Who is the contractor on this award?

The obligated recipient is PERATON ENTERPRISE SOLUTIONS LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Centers for Medicare and Medicaid Services).

What is the total obligated amount?

The obligated amount is $50.3 million.

What is the period of performance?

Start: 2009-01-13. End: 2015-01-12.

What is the historical spending trend for IT facilities management services at CMS?

Analyzing historical spending trends for IT facilities management at CMS requires access to detailed procurement data over multiple fiscal years. While this specific contract award is for $50.3 million from 2009 to 2015, it represents only one data point. To understand the trend, one would need to aggregate spending on similar services (NAICS code 541513 and related) awarded by CMS over a longer period, such as the last 5-10 years. This would involve identifying all relevant contracts, their values, and their periods of performance. Factors such as agency modernization efforts, budget allocations, and shifts towards cloud services would influence these trends. Without a broader dataset, it's difficult to establish a definitive spending trend, but this award indicates a significant, multi-year commitment to maintaining on-premises IT infrastructure during that period.

How does the number of bidders (2) compare to similar IT facilities management contracts awarded by HHS?

The number of bidders for IT facilities management contracts within the Department of Health and Human Services (HHS) can vary significantly depending on the specific service requirements, contract vehicle, and market conditions. A limited number of bidders, such as the two received for this $50.3 million contract, is not uncommon for highly specialized or large-scale IT services, especially if awarded under a specific IDIQ vehicle with pre-qualified vendors. However, for broader IT services, HHS often sees more competitive solicitations, sometimes with 5-10 or even more bids. The fact that this was a delivery order under a potentially larger IDIQ could mean that the pool of eligible bidders was already restricted. To provide a definitive comparison, one would need to analyze a statistically significant sample of similar IT facilities management contracts awarded by HHS over a recent period, noting their competition levels and contract types.

What are the key performance indicators (KPIs) typically associated with computer facilities management services?

Key Performance Indicators (KPIs) for computer facilities management services are crucial for ensuring the reliability, availability, and efficiency of IT infrastructure. Common KPIs include: System Uptime/Availability (measuring the percentage of time systems are operational), Mean Time Between Failures (MTBF) and Mean Time To Repair (MTTR) (tracking system reliability and recovery speed), Incident Response Time (how quickly issues are acknowledged and addressed), Resolution Rate (the percentage of issues resolved successfully on the first attempt), Performance Metrics (such as server response times, network latency), Security Compliance (adherence to security protocols and patch management), and Capacity Utilization (monitoring resource usage to prevent bottlenecks). For this specific contract, CMS would have defined specific KPIs within the Performance Work Statement (PWS) to measure Peraton Enterprise Solutions LLC's performance and ensure the contracted services met operational requirements.

What is the track record of Peraton Enterprise Solutions LLC in performing similar federal IT contracts?

Peraton Enterprise Solutions LLC, and its predecessor entities, have a substantial track record of performing federal IT contracts. While the 'OK' status provided in the data indicates satisfactory performance for this specific contract, a deeper dive would involve examining their contract history across various agencies. This would include reviewing contract values, durations, types of services rendered (e.g., IT infrastructure, cybersecurity, cloud migration), and past performance evaluations. Agencies often use data from the Contractor Performance Assessment Reporting System (CPARS) to assess vendor performance. Peraton has been involved in numerous large-scale federal IT procurements, often winning significant contracts related to mission-critical systems and infrastructure support for agencies like the Department of Defense, Intelligence Community, and civilian agencies. Their history suggests they are a major player capable of handling complex IT service delivery.

How has the shift towards cloud computing potentially impacted the need for traditional IT facilities management contracts like this one?

The increasing adoption of cloud computing has significantly altered the landscape for traditional IT facilities management contracts. As agencies migrate workloads and data to cloud environments (public, private, or hybrid), the need for managing on-premises physical data centers and associated hardware diminishes. This can lead to a reduction in the scope and value of contracts focused solely on maintaining physical IT infrastructure. However, it also creates new demands. Agencies still require robust management for hybrid environments, including secure connectivity to the cloud, integration services, and specialized cloud infrastructure management. Furthermore, even agencies heavily invested in the cloud often retain some on-premises infrastructure for specific applications, security reasons, or legacy systems. Therefore, while the nature of IT facilities management is evolving, contracts focusing on hybrid environments, cloud integration, and specialized on-premises support remain relevant, albeit with potentially different service requirements and cost structures compared to purely traditional models.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Facilities Management Services

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

Competition & Pricing

Extent Competed: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Peraton Solutions Inc. (UEI: 081218565)

Address: 13600 EDS DR A3S-B53, HERNDON, VA, 20171

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $50,290,580

Exercised Options: $50,290,580

Current Obligation: $50,290,580

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSM500200600002I

IDV Type: IDC

Timeline