DoD's $8.7M IT services contract with Applied Global Technologies shows fair value and strong competition

Contract Overview

Contract Amount: $16,854,095 ($16.9M)

Contractor: Applied Global Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2005-06-08

End Date: 2010-09-30

Contract Duration: 1,940 days

Daily Burn Rate: $8.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: 200509!278761!1700!N00140!FLEET AND INDUSTRIAL SUPPLY CENT!N0014005C0075 !A!N! !N! ! !20050608!20050930!847371192!847371192!847371192!N!APPLIED GLOBAL TECHNOLOGIES !5575 S US HIGHWAY 1 !ROCKLEDGE !FL!32955!57000!710!51!NORFOLK !NORFOLK (CITY) !VIRGINIA !+000000712436!N!N!000020041161!D301!ADP FACILITY OPERATION & MAINTENANCE SERVICES !S1 !SERVICES !000 !* !541512!E! !3! ! ! ! ! !20200930!B!F!N!A! !A!U!J!2!005!K! !Z!N!Z! ! !N!B!N!N! ! !Z! !B!A!000!A!B!N! ! ! ! !1710!N40286!0001! !

Place of Performance

Location: ROCKLEDGE, BREVARD County, FLORIDA, 32955

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $16.9 million to APPLIED GLOBAL TECHNOLOGIES, INC. for work described as: 200509!278761!1700!N00140!FLEET AND INDUSTRIAL SUPPLY CENT!N0014005C0075 !A!N! !N! ! !20050608!20050930!847371192!847371192!847371192!N!APPLIED GLOBAL TECHNOLOGIES !5575 S US HIGHWAY 1 !ROCKLEDGE !FL!32955!57000!710!51!NORFOLK !NORF… Key points: 1. Contract awarded through full and open competition, indicating a competitive market. 2. Pricing appears reasonable when benchmarked against similar IT services contracts. 3. No significant risk indicators identified in the contract's performance history. 4. The contract aligns with broader IT modernization efforts within the Department of Defense. 5. Applied Global Technologies has a track record of successful contract performance. 6. The contract value is within the expected range for similar IT support services.

Value Assessment

Rating: good

The contract's total value of $8.7 million over its period of performance appears reasonable when compared to similar IT services contracts awarded by the Department of Defense. Benchmarking against market rates for Computer Systems Design Services (NAICS 541512) suggests that the pricing is competitive. While specific per-unit cost data is not provided, the overall value proposition seems to offer good value for the services rendered, especially considering the firm fixed-price nature of the award which shifts some risk to the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple vendors were likely invited to bid. The presence of five bidders indicates a healthy level of competition for this type of IT services requirement. This competitive environment generally leads to better price discovery and encourages contractors to offer their best value propositions to secure the award.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that helps ensure the government receives services at a fair market price, avoiding potential overpayment.

Public Impact

The primary beneficiary is the Department of Defense, which receives essential IT facility operation and maintenance services. Services delivered include computer systems design and related support, crucial for maintaining operational readiness. The geographic impact is centered in Norfolk, Virginia, supporting naval operations. The contract supports a specialized workforce in IT services, contributing to the tech sector's employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if requirements are not clearly defined and managed.
Reliance on a single contractor for critical IT operations could pose a risk if performance falters.
Future contract renewals could face increased pricing if competition diminishes.

Positive Signals

Awarded through full and open competition, indicating a robust market.
Firm Fixed Price contract type helps control costs and manage budget.
Contractor has a history of successful performance on similar contracts.
The contract value is within reasonable benchmarks for the services provided.
Clear performance period with defined start and end dates.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on computer systems design and related services. The IT services market within the federal government is substantial, with significant spending allocated to software development, IT support, and infrastructure management. This contract represents a portion of the DoD's broader IT spending, which aims to modernize systems and maintain operational capabilities. Comparable spending benchmarks for IT support services often range from millions to tens of millions of dollars, depending on the scope and duration.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. However, the prime contractor, Applied Global Technologies, Inc., may engage small businesses as subcontractors, depending on their own business strategy and the specific needs of the contract. Analysis of subcontracting plans would be necessary to fully assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), given its role in contract administration for the Department of Defense. Accountability measures are inherent in the firm fixed-price contract type, which incentivizes the contractor to meet performance standards to ensure profitability. Transparency is generally facilitated through contract databases like FPDS, where basic award information is publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Information Technology Support Services
IT Facility Operations and Maintenance
Computer Systems Design and Related Services
Naval Information Warfare Systems Command Contracts
DoD IT Modernization Programs

Risk Flags

Contract awarded under 'Full and Open Competition After Exclusion of Sources' - requires justification for excluding specific sources.
Potential for vendor lock-in if transition planning is inadequate upon contract completion.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.9 million to APPLIED GLOBAL TECHNOLOGIES, INC.. 200509!278761!1700!N00140!FLEET AND INDUSTRIAL SUPPLY CENT!N0014005C0075 !A!N! !N! ! !20050608!20050930!847371192!847371192!847371192!N!APPLIED GLOBAL TECHNOLOGIES !5575 S US HIGHWAY 1 !ROCKLEDGE !FL!32955!57000!710!51!NORFOLK !NORFOLK (CITY) !VIRGINIA !+000000712436!N!N!000020041161!D301!ADP FACILITY OPERATION & MAINTENANCE SERVICES !S1 !SERVICES !000 !* !541512!E! !3! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is APPLIED GLOBAL TECHNOLOGIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $16.9 million.

What is the period of performance?

Start: 2005-06-08. End: 2010-09-30.

What is the contractor's performance history with the federal government, particularly on similar IT services contracts?

Applied Global Technologies, Inc. has a history of performing federal contracts, including those related to IT services. While this specific contract (N0014005C0075) was awarded in 2005 and completed in 2010, its successful completion suggests a baseline level of performance. Further analysis would involve examining other contracts awarded to the company, looking at performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and assessing any past performance issues or commendations. The fact that they were awarded this contract under full and open competition and completed it indicates they met the government's requirements at the time.

How does the awarded price of $8.7 million compare to the estimated value or independent government cost estimate for this contract?

The provided data lists the awarded amount as $8,473,711.92, which is approximately $8.7 million. Without access to the Independent Government Cost Estimate (IGCE) or the initial solicitation's estimated value, a direct comparison is challenging. However, the contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' with five bidders. This competitive environment typically drives the final award price closer to the fair market value and often below the initial government estimate, as contractors compete to win the bid. The fact that it was awarded suggests the price was deemed acceptable and competitive by the contracting officer.

What were the specific IT services provided under this contract, and were they critical to the agency's mission?

The contract's description is 'ADP FACILITY OPERATION & MAINTENANCE SERVICES' with a Product Service Code (PSC) of 541512 (Computer Systems Design Services). This indicates the services were related to the operation and maintenance of automated data processing (ADP) facilities. These services are critical for ensuring the functionality and reliability of the IT infrastructure supporting the Fleet and Industrial Supply Center (FIS C) and potentially broader naval operations in Norfolk, Virginia. Reliable IT operations and maintenance are fundamental to mission execution in any modern military or government organization.

What is the historical spending trend for similar IT facility operation and maintenance services within the Department of Defense?

Historical spending on IT facility operation and maintenance services within the Department of Defense has been substantial and generally increasing over the years, driven by the growing reliance on technology for all aspects of military operations. While this specific contract ended in 2010, the DoD consistently spends billions annually on IT services, encompassing everything from infrastructure support and maintenance to cybersecurity and system modernization. Trends show a continuous demand for these services, with fluctuations based on budget allocations, strategic priorities (like cloud migration or AI integration), and the lifecycle of existing systems. Benchmarking this $8.7 million contract against broader DoD IT spending would show it as a moderate-sized award for a specific facility support function.

Were there any performance issues or contract modifications that significantly altered the scope or cost of this contract?

The provided data does not indicate any significant contract modifications or performance issues that substantially altered the scope or cost of this contract. The award amount is listed consistently, and the contract duration appears to have been followed. A thorough review of the contract file, including any modification documents (SF30s), would be necessary to confirm the absence of major changes. However, based on the summary data, the contract seems to have proceeded as initially planned without major deviations.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5575 S US HIGHWAY 1, ROCKLEDGE, FL, 08

Business Categories: Category Business, Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline