Interior's $150M IT Support Contract with Empower AI Faces Scrutiny Over Value and Competition
Contract Overview
Contract Amount: $150,128,299 ($150.1M)
Contractor: Empower AI, Inc.
Awarding Agency: Department of the Interior
Start Date: 2008-12-01
End Date: 2016-03-31
Contract Duration: 2,677 days
Daily Burn Rate: $56.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 5
Pricing Type: TIME AND MATERIALS
Sector: IT
Official Description: NATIONAL CAPITAL REGION (NCR) IT SUPPORT SERVICES
Place of Performance
Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22204
State: Virginia Government Spending
Plain-Language Summary
Department of the Interior obligated $150.1 million to EMPOWER AI, INC. for work described as: NATIONAL CAPITAL REGION (NCR) IT SUPPORT SERVICES Key points: 1. The contract awarded to Empower AI, Inc. for IT support services in the NCR reached a significant value of over $150 million. 2. While listed as 'FULL AND OPEN COMPETITION', the contract's long duration (2008-2016) and multiple delivery orders warrant a closer look at the competitive landscape. 3. The use of 'TIME AND MATERIALS' pricing could pose a risk to cost control if not managed diligently. 4. The lack of small business participation is noted, despite the contract's substantial size.
Value Assessment
Rating: questionable
The total award value of $150M over 8 years for IT support services is substantial. Benchmarking against similar IT support contracts of that era is difficult without more granular data on services provided, but the duration and cost warrant scrutiny for potential overpayment or scope creep.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'FULL AND OPEN COMPETITION'. However, the long performance period and multiple delivery orders suggest a potentially extended relationship that could limit future competitive opportunities or lead to vendor lock-in if not actively managed.
Taxpayer Impact: The significant expenditure of taxpayer funds on this contract necessitates robust oversight to ensure value for money and prevent potential cost overruns.
Public Impact
Federal agencies rely on IT support services to maintain critical infrastructure and operations. Long-term contracts can impact the availability of opportunities for emerging technology providers and small businesses. Transparency in contract spending is crucial for public trust and accountability. The effectiveness of IT support directly influences agency efficiency and service delivery to the public.
Waste & Efficiency Indicators
Waste Risk Score: 56 / 10
Warning Flags
- Lack of Small Business Participation
- Potential for Cost Overruns (Time & Materials)
- Long Contract Duration
Positive Signals
- Full and Open Competition Awarded
- Significant Investment in IT Infrastructure
Sector Analysis
The Department of the Interior's spending on IT support services falls within the broader federal IT procurement landscape. Benchmarks for IT support services vary widely based on scope, duration, and complexity, but $150M over 8 years represents a considerable investment.
Small Business Impact
The contract data indicates that small businesses were not participants in this award, which is a missed opportunity for fostering small business growth within federal contracting, especially for a contract of this magnitude.
Oversight & Accountability
The contract's long duration and multiple delivery orders necessitate strong oversight from the Department of the Interior to ensure adherence to scope, manage costs effectively, and maintain accountability for service delivery.
Related Government Programs
- Electronic Computer Manufacturing
- Department of the Interior Contracting
- Departmental Offices Programs
Risk Flags
- Lack of Small Business Participation
- Potential for Cost Overruns (Time & Materials)
- Long Contract Duration (2008-2016)
- Limited Transparency on Specific Services Provided
- Potential for Vendor Lock-in Despite Initial Competition
Tags
electronic-computer-manufacturing, department-of-the-interior, va, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Interior awarded $150.1 million to EMPOWER AI, INC.. NATIONAL CAPITAL REGION (NCR) IT SUPPORT SERVICES
Who is the contractor on this award?
The obligated recipient is EMPOWER AI, INC..
Which agency awarded this contract?
Awarding agency: Department of the Interior (Departmental Offices).
What is the total obligated amount?
The obligated amount is $150.1 million.
What is the period of performance?
Start: 2008-12-01. End: 2016-03-31.
What specific IT support services were rendered under this contract, and how did their scope evolve over the 8-year period to justify the $150M expenditure?
Detailed service descriptions and a breakdown of services rendered across the contract's lifespan are needed to assess value. Without this, it's difficult to determine if the $150M was commensurate with the actual IT support provided. Evolution of IT needs and technological advancements during the 2008-2016 period likely influenced the scope, but justification requires specific documentation of services and their impact.
Given the 'TIME AND MATERIALS' pricing structure, what mechanisms were in place to control costs and prevent potential overruns throughout the contract's duration?
The effectiveness of cost controls under a Time and Materials (T&M) contract hinges on robust government oversight, including detailed monitoring of labor hours, rates, and material costs. Establishing cost ceilings, requiring detailed justifications for hours worked, and performing regular audits are crucial. The absence of specific details on these controls raises concerns about potential inefficiencies and uncontrolled spending.
How did the 'FULL AND OPEN COMPETITION' process ensure genuine competition and prevent potential vendor lock-in over the contract's extended period?
While initially awarded through full and open competition, the contract's long duration (2008-2016) and multiple delivery orders raise questions about sustained competition. Agencies must actively solicit new proposals for evolving needs and avoid sole-sourcing extensions. Periodic market research and re-competition strategies are vital to ensure that the government continues to receive competitive pricing and access to innovative solutions, rather than becoming reliant on a single incumbent.
Industry Classification
NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 5
Pricing Type: TIME AND MATERIALS (Y)
Evaluated Preference: NONE
Contractor Details
Parent Company: HIG Capital Management, Inc.
Address: 11730 PLAZA AMERICA DR STE 400, RESTON, VA, 20190
Business Categories: Category Business, Minority Owned Business, Not Designated a Small Business, Indian (Subcontinent) American Owned Business
Financial Breakdown
Contract Ceiling: $228,354,555
Exercised Options: $179,542,125
Current Obligation: $150,128,299
Actual Outlays: $477,130
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: W91QUZ07D0004
IDV Type: IDC
Timeline
Start Date: 2008-12-01
Current End Date: 2016-03-31
Potential End Date: 2016-03-31 00:00:00
Last Modified: 2023-02-15
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