DoD's $45.9M Contract for Engineering Support to NIKSOFT Systems Corp. Raises Competition Concerns
Contract Overview
Contract Amount: $45,905,653 ($45.9M)
Contractor: Niksoft Systems Corp.
Awarding Agency: Department of Defense
Start Date: 2021-09-29
End Date: 2023-09-29
Contract Duration: 730 days
Daily Burn Rate: $62.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: ENGINEERING SUPPORT RESOURCES FOR THE SYSTEMS ENGINEERING PLAN AS WELL AS THE CURRENT ENGINEERING SUPPORT WORK FOR CAPACITY SERVICES.
Place of Performance
Location: FREDERICKSBURG, FREDERICKSBURG CITY County, VIRGINIA, 22401
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $45.9 million to NIKSOFT SYSTEMS CORP. for work described as: ENGINEERING SUPPORT RESOURCES FOR THE SYSTEMS ENGINEERING PLAN AS WELL AS THE CURRENT ENGINEERING SUPPORT WORK FOR CAPACITY SERVICES. Key points: 1. Significant contract value of $45.9M awarded to a single vendor. 2. Lack of competition raises questions about price discovery and potential overspending. 3. The contract is for essential engineering support for capacity services. 4. Sector context is IT services within the Defense Health Agency.
Value Assessment
Rating: questionable
The contract's value of $45.9M for engineering support services is substantial. Without competitive bidding, it's difficult to benchmark against similar contracts to determine if the pricing is optimal.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, indicating a lack of competition. This limits price discovery and may result in higher costs for taxpayers.
Taxpayer Impact: The absence of competition on this $45.9M contract means taxpayers may not be receiving the best possible value.
Public Impact
Taxpayers may be overpaying due to the lack of competitive bidding. Essential engineering support for critical defense health systems is reliant on a single vendor. The long-term implications of sole-source contracts on innovation and cost-effectiveness are a concern.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for overpricing
Positive Signals
- Definitive contract awarded
- Long-term support provided
Sector Analysis
This contract falls within the IT services sector, specifically 'Other Computer Related Services'. The Department of Defense often awards large contracts in this area, but competitive practices are crucial for cost efficiency.
Small Business Impact
There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. The sole-source nature limits opportunities for small business participation.
Oversight & Accountability
The sole-source award warrants further oversight to ensure the pricing is fair and reasonable and that future requirements are competed to maximize value.
Related Government Programs
- Other Computer Related Services
- Department of Defense Contracting
- Defense Health Agency Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated costs due to lack of price discovery.
- Limited transparency on vendor selection justification.
- No clear indication of small business participation.
Tags
other-computer-related-services, department-of-defense, va, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $45.9 million to NIKSOFT SYSTEMS CORP.. ENGINEERING SUPPORT RESOURCES FOR THE SYSTEMS ENGINEERING PLAN AS WELL AS THE CURRENT ENGINEERING SUPPORT WORK FOR CAPACITY SERVICES.
Who is the contractor on this award?
The obligated recipient is NIKSOFT SYSTEMS CORP..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Health Agency).
What is the total obligated amount?
The obligated amount is $45.9 million.
What is the period of performance?
Start: 2021-09-29. End: 2023-09-29.
What is the justification for the sole-source award, and was a market research conducted to explore competitive options?
The provided data indicates the contract was 'NOT COMPETED' and awarded as a 'sole-source'. A thorough justification for this approach, including evidence of market research and why competitive options were not feasible or advantageous, would be necessary to fully assess the value and necessity of this procurement method.
How does the pricing of this contract compare to industry benchmarks for similar engineering support services, given the lack of competition?
Without competitive bids, directly comparing pricing is challenging. The benchmark of $6,288.40 (br) seems low for a contract of this size and duration, suggesting it might be a component or a different metric. A true assessment would require access to detailed cost breakdowns and comparison with similar sole-source or competitively awarded contracts in the defense IT sector.
What is the long-term strategy for ensuring cost-effectiveness and innovation in engineering support services for the Defense Health Agency?
The current sole-source award for engineering support raises questions about long-term cost-effectiveness and innovation. Agencies should prioritize competitive procurements for future requirements to drive down costs and encourage technological advancements. Exploring contract vehicles that allow for phased competition or performance-based metrics could also enhance value over time.
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: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: HT001121R0064
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1984 ISAAC NEWTON SQ W STE 306A, RESTON, VA, 20190
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $52,287,218
Exercised Options: $45,905,653
Current Obligation: $45,905,653
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Timeline
Start Date: 2021-09-29
Current End Date: 2023-09-29
Potential End Date: 2023-12-31 00:00:00
Last Modified: 2025-04-22
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