DHS TSA awards $23.1M for IT services, raising questions on value and competition

Contract Overview

Contract Amount: $23,130,577 ($23.1M)

Contractor: Systems Integration, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2017-04-21

End Date: 2019-09-30

Contract Duration: 892 days

Daily Burn Rate: $25.9K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: LABOR HOURS

Sector: IT

Official Description: IGF::OT::IGF TASK ORDER 001 TO FUND THE ACTIVITIES TO ACHIEVE AN AUTHORITY TO OPERATE

Place of Performance

Location: HYATTSVILLE, PRINCE GEORGES County, MARYLAND, 20785

State: Maryland Government Spending

Plain-Language Summary

Department of Homeland Security obligated $23.1 million to SYSTEMS INTEGRATION, INC. for work described as: IGF::OT::IGF TASK ORDER 001 TO FUND THE ACTIVITIES TO ACHIEVE AN AUTHORITY TO OPERATE Key points: 1. The contract's value appears moderate for IT services, but specific performance metrics are needed for a full value assessment. 2. Full and open competition was utilized, suggesting a potentially competitive pricing environment. 3. The duration of the contract (892 days) is substantial, requiring ongoing performance monitoring. 4. The task order falls under a broader BPA call, indicating it's part of a larger procurement strategy. 5. The North American Industry Classification System (NAICS) code 541519 suggests a focus on 'Other Computer Related Services'. 6. The contract was awarded to SYSTEMS INTEGRATION, INC., whose track record needs further examination. 7. The contract was awarded in Maryland, a hub for federal IT contracting.

Value Assessment

Rating: fair

The contract value of $23.1 million over approximately two and a half years for IT services is within a typical range for federal procurements of this nature. However, without detailed performance metrics or a clear understanding of the specific services rendered, it is difficult to definitively benchmark its value for money. Comparing it to similar task orders under the same BPA or to other TSA IT service contracts would provide better context. The labor hours pricing model (PT: LABOR HOURS) can sometimes lead to cost overruns if not managed tightly, making oversight crucial.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' which is the preferred method for federal procurements. This indicates that all responsible sources were permitted to submit an offer. The number of bidders is not specified in the provided data, but the nature of the competition suggests that multiple companies likely vied for this award. This level of competition is generally expected to drive more competitive pricing and better terms for the government.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it promotes a level playing field, encourages innovation, and typically leads to more cost-effective solutions by leveraging market forces.

Public Impact

The Transportation Security Administration (TSA) is the primary beneficiary, receiving IT services to support its operations. The services delivered likely contribute to the TSA's mission of ensuring the security of the nation's transportation systems. The geographic impact is primarily within Maryland, where the contractor is located and potentially where services are performed. The contract supports the IT workforce, likely involving skilled professionals in computer services and systems integration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific performance metrics makes it difficult to assess the true value and effectiveness of the services rendered.
The 'labor hours' pricing model can be susceptible to scope creep and cost overruns if not rigorously managed.
The duration of the contract (892 days) necessitates sustained oversight to ensure continued value and performance.
Information on the number of bidders is missing, which would provide a clearer picture of the competitive landscape.
The specific nature of the 'Other Computer Related Services' is broad and requires further detail to understand the scope of work.

Positive Signals

Awarded under full and open competition, indicating a potentially robust bidding process.
The contract supports a critical agency (DHS TSA) with essential IT services.
The task order is part of a broader BPA call, suggesting a strategic approach to IT procurement.
The contract value, while substantial, is within a reasonable range for the services described.
The contractor, SYSTEMS INTEGRATION, INC., has secured a federal contract, implying some level of established capability.

Sector Analysis

This contract falls within the broader Information Technology (IT) services sector, specifically under 'Other Computer Related Services' (NAICS 541519). This sector is characterized by a wide range of services including IT consulting, systems integration, and custom software development. Federal spending in this area is consistently high as agencies rely on IT for mission-critical functions. Comparable spending benchmarks would involve looking at other IT service contracts awarded by the Department of Homeland Security or similar agencies for system integration and support, often awarded through large indefinite-delivery, indefinite-quantity (IDIQ) vehicles or Broad Agency Announcements (BAAs).

Small Business Impact

The provided data indicates that small business participation (SB: false) was not a factor in this specific award, nor was it a small business set-aside (SS: false). This suggests the contract was competed broadly without specific provisions for small businesses. Consequently, there are no direct subcontracting implications for small businesses stemming from this particular task order. The impact on the small business ecosystem is neutral, as it did not prioritize or exclude small businesses.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Homeland Security (DHS) and specifically the Transportation Security Administration (TSA). As a task order under a BPA call, the overarching BPA likely has established oversight mechanisms. The contract's performance would be monitored by the contracting officer and the program office responsible for the IT services. Transparency is generally facilitated through contract databases like FPDS, where basic award information is published. Inspector General jurisdiction would apply if any issues of fraud, waste, or abuse arise during the contract's performance.

Related Government Programs

Department of Homeland Security IT Services
Transportation Security Administration Support Contracts
Broad Agency Announcement (BAA) Task Orders
IT Services for Federal Agencies
Systems Integration Contracts

Risk Flags

Potential for cost overruns due to labor hours pricing
Lack of specific performance metrics for value assessment
Limited transparency on number of bidders
Broad definition of 'Other Computer Related Services'

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $23.1 million to SYSTEMS INTEGRATION, INC.. IGF::OT::IGF TASK ORDER 001 TO FUND THE ACTIVITIES TO ACHIEVE AN AUTHORITY TO OPERATE

Who is the contractor on this award?

The obligated recipient is SYSTEMS INTEGRATION, INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Transportation Security Administration).

What is the total obligated amount?

The obligated amount is $23.1 million.

What is the period of performance?

Start: 2017-04-21. End: 2019-09-30.

What specific IT services were provided under this task order, and how do they align with the TSA's mission objectives?

The provided data categorizes this contract under NAICS code 541519, 'Other Computer Related Services.' This is a broad category that can encompass a wide range of activities, including IT consulting, systems integration, network management, and potentially custom software development or support. To understand its alignment with TSA's mission, one would need to examine the specific Statement of Work (SOW) for IGF::OT::IGF TASK ORDER 001. Without the SOW, it's presumed these services support TSA's operational needs, which could range from enhancing passenger screening technology, improving data management systems, or bolstering cybersecurity defenses. The 'activities to achieve an Authority to Operate' mentioned in the description suggest a focus on compliance, security, and system readiness, critical for TSA's sensitive operations.

How does the $23.1 million contract value compare to similar IT service contracts awarded by the TSA or DHS in recent years?

The $23.1 million contract value for approximately 2.5 years of service is a moderate sum within the federal IT contracting landscape. To benchmark this effectively, a comparative analysis against similar IT service contracts awarded by the TSA or DHS is necessary. This would involve identifying contracts with comparable NAICS codes (e.g., 541511, 541512, 541519) and service types (e.g., systems integration, IT support, software development) awarded within the last 2-3 fiscal years. Factors such as contract duration, labor mix, and specific deliverables would need to be considered. For instance, if similar contracts for comparable services averaged $10-15 million, this $23.1 million award might appear on the higher end, warranting closer scrutiny of the scope and pricing. Conversely, if other large-scale IT modernization efforts by TSA have exceeded $50 million, this award might seem more aligned.

What is the track record of SYSTEMS INTEGRATION, INC. in performing federal IT contracts, particularly those of similar size and scope?

SYSTEMS INTEGRATION, INC. has been awarded this $23.1 million task order by the TSA, indicating they possess the necessary qualifications and past performance to secure federal contracts. A deeper dive into their contract history within the Federal Procurement Data System (FPDS) or similar databases would reveal their experience with other federal agencies, the types of services they have provided, and their performance ratings on previous contracts. Examining contracts of similar dollar value and complexity, especially those involving IT services and systems integration for agencies like DHS, would provide crucial insights. Information on past performance evaluations, any contract disputes, or awards for exceptional performance would further illuminate their capabilities and reliability as a federal contractor.

Given the 'full and open competition' award, how many bids were received, and what does this imply about the pricing competitiveness?

The data states the contract was awarded under 'full and open competition,' which mandates that all responsible sources were allowed to submit bids. However, the specific number of bids received is not provided in the summary data. Typically, 'full and open competition' aims to maximize the number of bidders to foster a competitive environment. If a significant number of bids were received (e.g., five or more), it strongly suggests that the pricing is likely competitive, as bidders would need to offer favorable rates to win. Conversely, if only a few bids were submitted despite open competition, it might indicate market limitations, high barriers to entry for this specific service, or potential issues with the solicitation itself. Without the bidder count, we infer competitiveness based on the award method alone.

What are the potential risks associated with a 'labor hours' contract type for IT services, and what mitigation strategies are typically employed?

Contracts awarded using the 'labor hours' (LH) pricing model, like this one (PT: LABOR HOURS), carry inherent risks, primarily related to cost control. The government pays for the time spent by contractor personnel at pre-negotiated hourly rates, rather than for a fixed deliverable. This can lead to cost overruns if the scope of work expands unexpectedly (scope creep) or if contractor efficiency is lower than anticipated. To mitigate these risks, robust oversight is essential. This includes detailed tracking of labor hours, regular reviews of progress against milestones, clear definition and management of the scope of work, and potentially incorporating performance-based metrics or award-fee structures. Strong contract administration by the government team is critical to ensure that labor hours translate into effective service delivery at a reasonable cost.

How has federal spending on 'Other Computer Related Services' (NAICS 541519) trended over the past five years, and where does this $23.1M award fit in?

Federal spending on 'Other Computer Related Services' (NAICS 541519) has generally shown a consistent upward trend over the past five years, reflecting the increasing reliance of government agencies on specialized IT support, consulting, and integration services. This category often captures a diverse set of IT needs that don't fit neatly into more specific codes like software development or data processing. The $23.1 million award to SYSTEMS INTEGRATION, INC. by the TSA fits within this trend. While not an exceptionally large contract in the context of major IT modernization programs, it represents a significant investment for a specific task order. Analyzing historical spending data for NAICS 541519 across agencies like DHS would reveal the typical size and frequency of such awards, helping to contextualize this particular contract's scale and importance within the broader federal IT services market.

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

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rimhub Holdings, Inc.

Address: 8201 CORPORATE DR STE 300, HYATTSVILLE, MD, 20785

Business Categories: Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Minority Owned Business, Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $23,148,009

Exercised Options: $23,148,009

Current Obligation: $23,130,577

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: HSTS0116ATCC009

IDV Type: BPA

Timeline