DHS awards $17.5M contract for IT compliance support to Kadix Systems, LLC

Contract Overview

Contract Amount: $17,478,173 ($17.5M)

Contractor: Kadix Systems, LLC

Awarding Agency: Department of Homeland Security

Start Date: 2009-09-18

End Date: 2013-11-05

Contract Duration: 1,509 days

Daily Burn Rate: $11.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: COMPLIANCE AND OVERSIGHT SUPPORT SERVICES FOR DHS INFORMATION SECURITY COMPLIANCE PROGRAM

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20004

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $17.5 million to KADIX SYSTEMS, LLC for work described as: COMPLIANCE AND OVERSIGHT SUPPORT SERVICES FOR DHS INFORMATION SECURITY COMPLIANCE PROGRAM Key points: 1. Contract focuses on essential IT security compliance, a critical function for DHS. 2. The award was made under full and open competition, suggesting a competitive process. 3. Kadix Systems, LLC is the sole awardee for this specific delivery order. 4. The contract duration spans over 4 years, indicating a long-term need. 5. The fixed-price nature of the contract shifts performance risk to the contractor. 6. This award falls within the Computer Systems Design Services NAICS code.

Value Assessment

Rating: good

The total award amount of $17.5 million over approximately four years suggests a moderate investment in IT compliance support. Benchmarking against similar contracts for IT security compliance services within DHS or other large federal agencies would provide a clearer picture of value for money. Without specific per-unit cost data or comparison to market rates for similar services, a definitive assessment of pricing efficiency is challenging. However, the fixed-price contract type generally promotes cost control by the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources.' While the 'full and open' aspect indicates an initial broad solicitation, the 'exclusion of sources' clause suggests specific criteria or circumstances led to a narrowed pool of bidders. The number of bidders is not explicitly stated, but the competition type implies multiple entities were considered. The level of competition is crucial for understanding price discovery and ensuring the government receives competitive pricing.

Taxpayer Impact: The use of full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down costs and encourage innovation. However, the 'exclusion of sources' aspect warrants further scrutiny to ensure it did not unduly limit competition and potentially increase costs.

Public Impact

The Department of Homeland Security (DHS) benefits directly through enhanced IT security compliance. Services delivered are critical for maintaining the security posture of DHS information systems. The geographic impact is primarily within the District of Columbia, where DHS headquarters is located. This contract supports a specialized workforce in IT security and compliance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' clause in the competition type requires further investigation to ensure it did not limit competition unnecessarily.
Lack of detailed performance metrics makes it difficult to assess the effectiveness of the compliance support provided.
The specific nature of the 'compliance and oversight support' could be more clearly defined to understand the full scope of work.

Positive Signals

Awarded under full and open competition, indicating an effort to solicit from a wide range of potential offerors.
The fixed-price contract type aligns incentives for the contractor to manage costs effectively.
The contract addresses a critical need for IT security compliance within a major federal agency.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computer systems design and related services. The market for IT security and compliance support is robust, driven by increasing cybersecurity threats and stringent regulatory requirements for government agencies. Comparable spending benchmarks would involve analyzing other DHS contracts or those from agencies like the Department of Defense or GSA for similar IT security compliance services. The overall IT services market for the federal government represents billions of dollars annually.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses arising from a small business set-aside. The analysis of small business participation would depend on whether Kadix Systems, LLC, as the prime contractor, voluntarily includes small businesses in its subcontracting plan, which is not detailed in the provided information.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within DHS responsible for IT security compliance. Accountability measures are inherent in the firm-fixed-price contract type, where the contractor is responsible for delivering services within the agreed-upon price. Transparency is generally facilitated through contract award databases like FPDS-NG. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract were suspected.

Related Government Programs

DHS Information Security Program
Federal Information Security Management Act (FISMA) Compliance
Cybersecurity Support Services
IT Consulting Services

Risk Flags

Potential for limited competition due to 'exclusion of sources'.
Lack of detailed performance metrics for assessing effectiveness.
Scope definition clarity for 'compliance and oversight support'.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $17.5 million to KADIX SYSTEMS, LLC. COMPLIANCE AND OVERSIGHT SUPPORT SERVICES FOR DHS INFORMATION SECURITY COMPLIANCE PROGRAM

Who is the contractor on this award?

The obligated recipient is KADIX SYSTEMS, LLC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Office of Procurement Operations).

What is the total obligated amount?

The obligated amount is $17.5 million.

What is the period of performance?

Start: 2009-09-18. End: 2013-11-05.

What is the specific nature of the 'compliance and oversight support services' provided under this contract?

The contract, "COMPLIANCE AND OVERSIGHT SUPPORT SERVICES FOR DHS INFORMATION SECURITY COMPLIANCE PROGRAM," indicates that Kadix Systems, LLC is providing services to assist the Department of Homeland Security (DHS) in managing and ensuring compliance with its information security policies and federal regulations. This likely includes activities such as assessing security controls, developing and implementing security policies, conducting risk assessments, monitoring compliance with standards like FISMA (Federal Information Security Management Act), preparing documentation for audits, and providing guidance on security best practices. The exact deliverables and scope would be detailed in the contract's Statement of Work (SOW), which is not provided here. The goal is to strengthen DHS's overall cybersecurity posture and ensure the integrity and confidentiality of its information systems.

How does the $17.5 million award compare to historical spending on similar IT security compliance services at DHS?

To compare the $17.5 million award to historical spending, one would need to access historical contract data for similar IT security compliance services awarded by DHS. This would involve searching databases like FPDS-NG for contracts with comparable NAICS codes (e.g., 541512 - Computer Systems Design Services) and service descriptions related to information security, compliance, and oversight. Analyzing the total dollar value, duration, and number of awards over previous fiscal years would reveal trends. For instance, if DHS has consistently awarded similar contracts in the $3-5 million range annually, then this $17.5 million award over four years might represent a significant increase or a consolidation of services. Conversely, if historical spending has been in a similar range, it suggests consistent investment in this area.

What are the potential risks associated with Kadix Systems, LLC's performance on this contract?

Potential risks associated with Kadix Systems, LLC's performance include failure to meet the specific compliance requirements mandated by DHS and federal regulations, leading to security vulnerabilities or audit failures. There's also a risk of delays in service delivery, impacting DHS's ability to maintain its security posture. Given the specialized nature of IT security compliance, a shortage of qualified personnel by Kadix Systems could impact the quality and timeliness of support. Furthermore, if the contract's scope is not clearly defined or if requirements change significantly, scope creep could lead to cost overruns or performance issues, despite the fixed-price nature. The 'exclusion of sources' in the competition also introduces a risk that the chosen vendor might not be the most cost-effective or technically superior option available.

What does the 'Full and Open Competition After Exclusion of Sources' designation imply for the procurement process?

The designation 'Full and Open Competition After Exclusion of Sources' implies a multi-stage procurement process. Initially, the solicitation was intended for all responsible sources ('Full and Open Competition'). However, at some point, specific sources were excluded. This exclusion could be due to various reasons, such as the need for specific technical expertise, prior performance on related tasks, or unique capabilities possessed by the remaining offerors. While it starts with broad competition, the exclusion narrows the field. This can sometimes be a legitimate way to ensure the best fit for complex requirements, but it also carries a risk of limiting the competitive landscape, potentially impacting price discovery and the range of innovative solutions considered. The justification for excluding sources is critical for assessing the fairness and effectiveness of the competition.

How does the fixed-price contract type influence contractor behavior and government risk?

A Firm Fixed Price (FFP) contract type, as indicated for this award, places the primary responsibility for cost control and performance risk on the contractor, Kadix Systems, LLC. This means the contractor agrees to a set price for the defined scope of work, and any cost overruns incurred are absorbed by the contractor. Conversely, if the contractor can complete the work more efficiently than anticipated, they retain the profit. This structure incentivizes the contractor to manage resources effectively, minimize waste, and deliver the required services within budget. For the government, the primary benefit is cost certainty; the total expenditure is known upfront. The main risk for the government is that the contractor might cut corners on quality or scope to maintain profitability, although contract oversight mechanisms are in place to mitigate this.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HSHQDC-09-R-00092

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Engility Corporation (UEI: 783837672)

Address: 4245 N FAIRFAX DR, STE. 700, ARLINGTON, VA, 22203

Business Categories: 8(a) Program Participant, Category Business, Minority Owned Business, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, Indian (Subcontinent) American Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $17,687,406

Exercised Options: $17,687,406

Current Obligation: $17,478,173

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HSHQDC06D00047

IDV Type: IDC

Timeline