HHS Awards $28.4M for Colocation Services to Savvis Federal Systems Inc
Contract Overview
Contract Amount: $28,402,493 ($28.4M)
Contractor: Savvis Federal Systems Inc
Awarding Agency: Department of Health and Human Services
Start Date: 2014-01-27
End Date: 2024-07-29
Contract Duration: 3,836 days
Daily Burn Rate: $7.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 6
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: IGF::OT::IGF CIT/DCSS - QWEST GOVERNMENT SERVICES - BASE YEAR FUNDING - COLOCATION (DCSS) - SEE DCSS FUNDING DOCUMENT FOR DETAILED COST INFORMATION
Place of Performance
Location: BETHESDA, MONTGOMERY County, MARYLAND, 20892
State: Maryland Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $28.4 million to SAVVIS FEDERAL SYSTEMS INC for work described as: IGF::OT::IGF CIT/DCSS - QWEST GOVERNMENT SERVICES - BASE YEAR FUNDING - COLOCATION (DCSS) - SEE DCSS FUNDING DOCUMENT FOR DETAILED COST INFORMATION Key points: 1. Contract awarded for colocation services to Savvis Federal Systems Inc. 2. Significant funding allocated for base year of services. 3. Competition method was full and open, suggesting potential for competitive pricing. 4. Contract duration extends over 10 years, indicating long-term need. 5. Sector is IT services, specifically Other Computer Related Services.
Value Assessment
Rating: fair
The contract value of $28.4M for the base year appears substantial. Benchmarking against similar colocation contracts would be necessary to determine if this pricing is competitive, especially given the long duration.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which typically allows for a wide range of bidders and can lead to better price discovery. The number of bids received (6) indicates a degree of market interest.
Taxpayer Impact: Taxpayer funds are being used for essential IT infrastructure. Competitive bidding aims to ensure value for money, but long-term contracts require ongoing scrutiny.
Public Impact
Ensures critical IT infrastructure for the National Institutes of Health. Supports ongoing health research and public health initiatives. Long-term commitment may impact budget flexibility for future IT needs. Relies on a single vendor for a significant period.
Waste & Efficiency Indicators
Waste Risk Score: 70 / 10
Warning Flags
- Long contract duration (over 10 years) may lock in potentially suboptimal pricing.
- Lack of specific unit cost data makes detailed value assessment difficult.
- Dependence on a single vendor for critical infrastructure.
Positive Signals
- Awarded under full and open competition.
- Received multiple bids (6), indicating market interest.
- Firms fixed price contract provides cost certainty.
Sector Analysis
This contract falls within the IT services sector, specifically 'Other Computer Related Services'. Spending in this area is critical for government operations, and benchmarks vary widely based on service type and scale.
Small Business Impact
The data does not indicate any specific set-aside for small businesses. The prime contractor, Savvis Federal Systems Inc., is likely a large business, and subcontracting opportunities for small businesses are not detailed here.
Oversight & Accountability
The contract is a delivery order under a larger contract vehicle. Oversight would involve monitoring performance, adherence to terms, and financial expenditures against the awarded amount. The duration necessitates consistent review.
Related Government Programs
- Other Computer Related Services
- Department of Health and Human Services Contracting
- National Institutes of Health Programs
Risk Flags
- Long contract duration
- Potential for vendor lock-in
- Lack of detailed cost breakdown
- Risk of technological obsolescence
- Limited visibility into subcontracting
Tags
other-computer-related-services, department-of-health-and-human-services, md, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $28.4 million to SAVVIS FEDERAL SYSTEMS INC. IGF::OT::IGF CIT/DCSS - QWEST GOVERNMENT SERVICES - BASE YEAR FUNDING - COLOCATION (DCSS) - SEE DCSS FUNDING DOCUMENT FOR DETAILED COST INFORMATION
Who is the contractor on this award?
The obligated recipient is SAVVIS FEDERAL SYSTEMS INC.
Which agency awarded this contract?
Awarding agency: Department of Health and Human Services (National Institutes of Health).
What is the total obligated amount?
The obligated amount is $28.4 million.
What is the period of performance?
Start: 2014-01-27. End: 2024-07-29.
What is the total estimated value of the contract over its entire duration, and how does this compare to industry benchmarks for similar colocation services?
The provided data only details the base year funding of $28.4M. The total contract value over its full duration (ending 2024) is not explicitly stated but can be inferred to be significantly higher given the 3836-day term. A comprehensive comparison to industry benchmarks requires detailed service level agreements and pricing structures, which are not available in this summary.
What are the specific risks associated with a long-term (over 10 years) fixed-price contract for colocation services, particularly regarding technological obsolescence and price escalation?
Long-term contracts risk technological obsolescence if the vendor's infrastructure doesn't keep pace with advancements, potentially leading to performance issues. Fixed-price structures can protect against price escalation but may also mean the government misses out on potential cost savings if market prices decrease. Renegotiation clauses or performance-based adjustments are crucial.
How effectively does the full and open competition process ensure ongoing value for money throughout the contract's extended period, given potential market shifts?
Full and open competition at the initial award stage is designed to secure competitive pricing. However, its effectiveness in ensuring ongoing value over a decade diminishes without mechanisms for periodic review or re-competition. Market shifts, technological changes, and vendor performance require active management to prevent value erosion.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related 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: FCISJB980001B
Offers Received: 6
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lumen Technologies, Inc
Address: 4250 N FAIRFAX DRIVE, ARLINGTON, VA, 22203
Business Categories: Category Business, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $66,203,105
Exercised Options: $28,402,493
Current Obligation: $28,402,493
Actual Outlays: $8,399,212
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: GS35F0164M
IDV Type: FSS
Timeline
Start Date: 2014-01-27
Current End Date: 2024-07-29
Potential End Date: 2024-07-29 00:00:00
Last Modified: 2023-12-05
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