DoD's $14.75M contract for IT services awarded to Perpetual Technologies Inc. shows potential value concerns

Contract Overview

Contract Amount: $14,751,663 ($14.8M)

Contractor: Perpetual Technologies Inc

Awarding Agency: Department of Defense

Start Date: 2001-10-11

End Date: 2005-09-30

Contract Duration: 1,450 days

Daily Burn Rate: $10.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: 200210!000093!9700!ZF26 !DEF FIN & ACTG SVC, INDIANAPOLIS!GS35F0204L !C!N! !N!MDA26001F0164P00001!20011011!20020930!106796050!106796050!106796050!N!PERPETUAL TECHNOLOGIES, INC !3500 DEPAUW BLVD SUITE 205!INDIANAPOLIS !IN!46268!36000!097!18!INDIANAPOLIS !MARION !INDIANA !+000000223650!N!N!000000000000!L070!TECH REP SVCS/ADP EQUIP & SUPPLIES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !541512!E! !6! ! !D! ! !99990909!B!E!Y! ! !A! ! ! !000! ! ! ! ! ! ! !Y!B!N!N! ! ! ! ! ! !* ! ! ! ! ! ! ! ! ! !0001!

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46249, UNITED STATES OF AMERICA

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $14.8 million to PERPETUAL TECHNOLOGIES INC for work described as: 200210!000093!9700!ZF26 !DEF FIN & ACTG SVC, INDIANAPOLIS!GS35F0204L !C!N! !N!MDA26001F0164P00001!20011011!20020930!106796050!106796050!106796050!N!PERPETUAL TECHNOLOGIES, INC !3500 DEPAUW BLVD SUITE 205!INDIANAPOLIS !IN!46268!36000!097!18!INDIANAPOLIS !MARION !INDIANA !+00000022… Key points: 1. The contract's value appears high relative to its duration and scope, warranting further investigation into cost-effectiveness. 2. Competition was full and open, suggesting a competitive bidding process that should have yielded favorable pricing. 3. The contract's performance period spans over four years, indicating a need for sustained service delivery and oversight. 4. The services procured fall under IT and ADP equipment, a critical area for defense operations. 5. The contractor, Perpetual Technologies Inc., has a significant contract history with the government, requiring a review of past performance. 6. The contract was awarded as a firm-fixed-price type, which shifts performance risk to the contractor.

Value Assessment

Rating: questionable

The total contract value of $14.75 million over approximately four years averages to about $3.7 million per year. While specific benchmarks for 'DEF FIN & ACTG SVC' are not readily available, this annual spend for IT services, particularly Computer Systems Design Services (NAICS 541512), seems substantial. Without detailed task orders or performance metrics, it's difficult to definitively assess value for money. However, given the duration and the nature of IT services, the overall cost warrants scrutiny to ensure it aligns with market rates and delivered outcomes.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. This suggests a robust bidding environment. However, the number of bids received is not specified in the provided data, which would be crucial for a complete assessment of the competitive landscape. A high level of competition typically drives down prices and improves service quality.

Taxpayer Impact: A full and open competition is generally favorable for taxpayers as it maximizes the potential for competitive pricing and encourages multiple vendors to offer their best value.

Public Impact

The Department of Defense, specifically the Defense Finance and Accounting Service (DFAS), is the primary beneficiary, receiving IT and ADP support services. These services are crucial for the financial and accounting operations of the military, ensuring efficient management of defense funds. The contract is geographically focused on Indianapolis, Indiana, where the contractor is located, potentially impacting the local economy through employment. The workforce implications include the need for skilled IT professionals to deliver the contracted services, potentially creating or sustaining jobs in the Indianapolis area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the scope of 'DEF FIN & ACTG SVC' expands beyond initial expectations without adequate price adjustments.
Risk of vendor lock-in if the services are highly specialized and difficult to transition to another provider.
Dependence on a single contractor for critical financial IT systems could pose operational risks if performance falters.

Positive Signals

Firm-fixed-price contract structure shifts performance risk to the contractor, potentially leading to cost savings for the government.
Full and open competition suggests a healthy market engagement, likely resulting in competitive pricing.
The contract duration indicates a stable, long-term need, allowing for potential efficiency gains through established processes.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically Computer Systems Design Services. The IT services market for the federal government is vast, with significant spending allocated to software development, system integration, and IT support. Contracts like this are essential for maintaining and upgrading the complex technological infrastructure required by agencies like the Department of Defense. Benchmarking this contract's value would require comparing it to similar IT support contracts awarded by DoD or other federal agencies for comparable services and durations.

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 or specific impacts on the small business ecosystem stemming from a small business set-aside. The focus remains on large business competition or general market participation.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contract administration office within the Department of Defense, likely the Defense Finance and Accounting Service (DFAS). Accountability measures would be defined in the contract's statement of work and performance standards. Transparency is generally facilitated through contract databases like FPDS, where basic award information is publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Defense Finance and Accounting Service (DFAS) IT Support Contracts
Department of Defense IT Services Procurement
Computer Systems Design Services Contracts
Federal Financial Management Systems IT Support
IT Services for Defense Agencies

Risk Flags

Potential for high cost relative to duration
Lack of specific performance metrics in summary data
Need for detailed comparison with market rates

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.8 million to PERPETUAL TECHNOLOGIES INC. 200210!000093!9700!ZF26 !DEF FIN & ACTG SVC, INDIANAPOLIS!GS35F0204L !C!N! !N!MDA26001F0164P00001!20011011!20020930!106796050!106796050!106796050!N!PERPETUAL TECHNOLOGIES, INC !3500 DEPAUW BLVD SUITE 205!INDIANAPOLIS !IN!46268!36000!097!18!INDIANAPOLIS !MARION !INDIANA !+000000223650!N!N!000000000000!L070!TECH REP SVCS/ADP EQUIP & SUPPLIES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !541512!E! !6! ! !D! ! !99990909!B!E!Y! ! !A! ! ! !000! ! ! ! ! ! ! !Y!B!N!N! ! ! ! ! ! !* ! ! ! ! ! ! ! ! !

Who is the contractor on this award?

The obligated recipient is PERPETUAL TECHNOLOGIES INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Finance and Accounting Service).

What is the total obligated amount?

The obligated amount is $14.8 million.

What is the period of performance?

Start: 2001-10-11. End: 2005-09-30.

What is the track record of Perpetual Technologies, Inc. with federal contracts, particularly those involving IT services for defense agencies?

Perpetual Technologies, Inc. has a history of receiving federal contracts, including this significant award from the Department of Defense. A deeper dive into their contract history would reveal the types of services they have provided, their performance ratings on past contracts, and any instances of contract modifications, disputes, or terminations. Understanding their past performance, especially with similar IT and financial systems support for defense entities, is crucial for assessing their capability and reliability in fulfilling the current contract's requirements. Analyzing their award data across different agencies and contract types can provide a comprehensive view of their federal contracting experience and potential risks.

How does the $14.75 million contract value compare to similar IT services contracts awarded by the DoD or other federal agencies for comparable services and durations?

Benchmarking the $14.75 million contract value requires comparing it against similar contracts for Computer Systems Design Services (NAICS 541512) awarded over a similar timeframe (approximately four years) by the Department of Defense or other federal agencies. Without access to a detailed database of comparable contract values, specific per-year or per-service cost comparisons are difficult. However, an average annual spend of roughly $3.7 million for IT services could be considered high or low depending on the complexity, scope, and criticality of the services provided. A thorough analysis would involve identifying contracts with similar statements of work, service levels, and geographic locations to establish a relevant market price range.

What specific IT services are included under 'DEF FIN & ACTG SVC', and what are the key performance indicators (KPIs) for this contract?

The designation 'DEF FIN & ACTG SVC' suggests that the contract covers Information Technology (IT) services supporting the financial and accounting functions of the Department of Defense. This could encompass a wide range of services, such as IT system design, development, integration, maintenance, support, and potentially hardware/software procurement related to financial management systems. Key Performance Indicators (KPIs) are critical for measuring the contractor's performance and ensuring value for money. While not detailed in the provided summary data, typical KPIs for such contracts might include system uptime, response times for technical support, successful completion of software updates, data accuracy rates, and adherence to security protocols. The absence of specific KPIs in the summary data necessitates further investigation into the contract's statement of work.

What is the historical spending pattern for 'DEF FIN & ACTG SVC' or similar IT services by the Defense Finance and Accounting Service (DFAS)?

Analyzing historical spending patterns for 'DEF FIN & ACTG SVC' or comparable IT services by DFAS is essential for understanding trends, identifying potential cost efficiencies, and assessing the reasonableness of current spending. This would involve examining DFAS's procurement data over several fiscal years to identify the total amount spent on IT support, the types of services procured, the primary contractors, and the average contract values. Significant year-over-year increases or decreases in spending, or a concentration of awards to a few vendors, could indicate important market dynamics or potential areas for cost optimization. Understanding this historical context provides a baseline against which the current $14.75 million contract can be evaluated.

Are there any known risks associated with Perpetual Technologies, Inc. or the specific IT services required for defense financial and accounting functions?

Assessing risks associated with Perpetual Technologies, Inc. and the required IT services involves reviewing the contractor's past performance, financial stability, and any history of security incidents or contract disputes. For IT services supporting defense financial and accounting functions, risks can include cybersecurity vulnerabilities, data breaches, system failures impacting critical operations, and challenges in adapting to evolving technological requirements or regulatory changes. The complexity of defense financial systems means that any disruption could have significant consequences. A thorough risk assessment would also consider the potential impact of personnel turnover within the contractor's team and their ability to maintain necessary security clearances.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 5649 LEE RD, INDIANAPOLIS, IN, 46216

Business Categories: Category Business, Small Business, Subchapter S Corporation, Veteran Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS35F0204L

IDV Type: FSS

Timeline