DoD's $80.7M IT Services Contract Awarded to Peraton Enterprise Solutions LLC Under Sole-Source Basis

Contract Overview

Contract Amount: $80,726,800 ($80.7M)

Contractor: Peraton Enterprise Solutions LLC

Awarding Agency: Department of Defense

Start Date: 2012-03-31

End Date: 2012-09-30

Contract Duration: 183 days

Daily Burn Rate: $441.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: OTHER ADP AND TELECOMMUNICATIONS SVS

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20171

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $80.7 million to PERATON ENTERPRISE SOLUTIONS LLC for work described as: OTHER ADP AND TELECOMMUNICATIONS SVS Key points: 1. Contract awarded on a sole-source basis, limiting competitive pricing benefits. 2. Significant spending on IT services, indicating a substantial need within the Department of the Navy. 3. Fixed-price contract type may offer cost certainty but could limit flexibility for evolving needs. 4. Short contract duration of 183 days suggests a specific, short-term requirement. 5. The contract falls under 'Other Computer Related Services,' a broad category. 6. No small business set-aside was applied, potentially impacting small business participation.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature and short duration. Without competitive bids, it's difficult to assess if the $80.7 million represents a fair market price for the 'Other Computer Related Services' provided. The contract's value is high for a short-term engagement, suggesting either a critical need or potentially inflated costs due to lack of competition. Further analysis would require understanding the specific services rendered and comparing them to similar sole-source procurements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Peraton Enterprise Solutions LLC, was solicited. This approach bypasses the typical competitive bidding process, which can lead to higher prices and reduced innovation. The lack of competition means there was no opportunity for other qualified vendors to offer their services, potentially at a lower cost or with better terms. This procurement strategy raises questions about the government's efforts to secure the best value for taxpayer dollars.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from the cost savings typically achieved through competitive bidding. This can result in higher overall spending for essential government services.

Public Impact

The Department of the Navy benefits from the provision of IT services, crucial for its operational functions. The contract supports the delivery of 'Other Computer Related Services,' which could encompass a wide range of IT support. The geographic impact is likely concentrated within the Department of the Navy's operational areas, primarily in Virginia. The contract supports the workforce employed by Peraton Enterprise Solutions LLC, contributing to IT sector employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potential cost savings for taxpayers.
High dollar value for a short-term contract raises questions about cost-effectiveness.
Lack of transparency in the justification for sole-source award.
Broad service category ('Other Computer Related Services') may obscure specific performance metrics.
No indication of small business subcontracting goals.

Positive Signals

Contract awarded to a single, established vendor, potentially ensuring continuity of service.
Fixed-price contract offers some budget predictability.
The contract addresses a specific need within the Department of the Navy.

Sector Analysis

The Information Technology (IT) sector is a critical component of government operations, encompassing a vast array of services from hardware procurement to complex software development and cybersecurity. Spending in this sector is consistently high across federal agencies. This contract, categorized under 'Other Computer Related Services,' falls within the broader IT services market, which is characterized by intense competition among large and small firms. However, sole-source awards, like this one, represent a deviation from the norm and can indicate unique capabilities required or a lack of available alternatives.

Small Business Impact

This contract was not set aside for small businesses, nor is there an indication of subcontracting requirements. This means that opportunities for small businesses to participate in delivering these IT services were likely limited. The absence of small business involvement in a contract of this magnitude can reduce the overall economic impact on the small business ecosystem and limit the government's ability to leverage the innovation and agility often found in smaller firms.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. As a sole-source award, the justification and approval process would be subject to specific federal acquisition regulations. Transparency regarding the specific services, performance metrics, and justification for the sole-source award is crucial for effective oversight. Without readily available details on these aspects, assessing accountability measures is challenging.

Related Government Programs

Department of Defense IT Services
Navy IT Procurement
Sole-Source IT Contracts
Other Computer Related Services

Risk Flags

Sole-source award
Lack of competition
High value for short duration
Broad service category

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $80.7 million to PERATON ENTERPRISE SOLUTIONS LLC. OTHER ADP AND TELECOMMUNICATIONS SVS

Who is the contractor on this award?

The obligated recipient is PERATON ENTERPRISE SOLUTIONS LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $80.7 million.

What is the period of performance?

Start: 2012-03-31. End: 2012-09-30.

What specific 'Other Computer Related Services' were provided under this contract?

The provided data does not specify the exact nature of the 'Other Computer Related Services' rendered. This category (NAICS code 541519) is broad and can include services such as IT consulting, systems integration design, computer facilities management, and IT support services. Without further details, it is difficult to ascertain the precise scope of work, the technical expertise required, or how these services directly supported the Department of the Navy's mission. Understanding the specific deliverables would be essential for a comprehensive value assessment and performance evaluation.

What was the justification for awarding this contract on a sole-source basis?

Federal regulations permit sole-source awards under specific circumstances, such as when only one responsible source is available or possesses unique capabilities. For this contract, the justification for a sole-source award is not provided in the data. Typically, such justifications would detail why other vendors could not meet the requirement, the unique qualifications of Peraton Enterprise Solutions LLC, or if the procurement was for a follow-on effort where only the incumbent could perform. Without this justification, it is difficult to assess if the sole-source decision was appropriate and in the government's best interest.

How does the $80.7 million contract value compare to similar IT services contracts awarded by the Department of the Navy?

Comparing this $80.7 million contract value is challenging without knowing the specific services rendered and the contract duration. However, for a short-term engagement (183 days), this represents a significant expenditure. Typical IT services contracts can range widely in value depending on scope, duration, and competition. Given this was a sole-source award, it is plausible that the price may be higher than if it had been competitively procured. Benchmarking would require identifying comparable sole-source awards for similar IT services within the Navy or other DoD components, which is not readily available in the provided data.

What is Peraton Enterprise Solutions LLC's track record with the Department of the Navy and other federal agencies?

The provided data indicates Peraton Enterprise Solutions LLC was the awardee. To assess their track record, one would need to examine their past performance on federal contracts, including delivery timeliness, quality of service, and adherence to budget. Information on past performance, customer satisfaction, and any past disputes or contract terminations would be crucial. A review of contract databases and performance assessment reports (if available) would offer insights into their reliability and capability in delivering IT services to the government.

What are the potential risks associated with a sole-source award of this magnitude?

The primary risks associated with a sole-source award of this magnitude include a lack of price competition, potentially leading to overpayment by taxpayers. There's also a risk of reduced innovation, as the vendor may face less pressure to improve services or offer cost-saving solutions. Furthermore, sole-source awards can sometimes indicate a lack of market research or planning by the agency, or potentially a reliance on a single vendor that could create future dependencies. Ensuring robust oversight and justification is critical to mitigate these risks.

What is the historical spending trend for 'Other Computer Related Services' by the Department of the Navy?

The provided data only pertains to a single contract award. To understand historical spending trends for 'Other Computer Related Services' by the Department of the Navy, a broader analysis of historical contract awards under NAICS code 541519 would be necessary. This would involve examining spending over several fiscal years to identify patterns, average contract values, common awardees, and the prevalence of competitive versus sole-source procurements within this service category. Such an analysis would provide context for the significance of this $80.7 million award.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: HP, Inc.

Address: 13600 EDS DR, HERNDON, VA, 20171

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $80,726,800

Exercised Options: $80,726,800

Current Obligation: $80,726,800

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0003910D0010

IDV Type: IDC

Timeline