DoD's $34M contract with STRATASCOR, LLC for afloat operations and sustainment shows fair value but limited competition

Contract Overview

Contract Amount: $34,033,930 ($34.0M)

Contractor: Stratascor, LLC

Awarding Agency: Department of Defense

Start Date: 2023-01-01

End Date: 2023-12-31

Contract Duration: 364 days

Daily Burn Rate: $93.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: N102A WIGGINS N6 - AFLOAT OPERATIONS AND SUSTAINMENT 2023

Place of Performance

Location: VIRGINIA BEACH, VIRGINIA BEACH CITY County, VIRGINIA, 23452

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $34.0 million to STRATASCOR, LLC for work described as: N102A WIGGINS N6 - AFLOAT OPERATIONS AND SUSTAINMENT 2023 Key points: 1. The contract's value appears reasonable when benchmarked against similar IT services, though specific performance metrics are not publicly detailed. 2. Competition was limited, raising questions about whether the government secured the best possible pricing and innovation. 3. The fixed-price contract type mitigates cost overrun risks for the government. 4. STRATASCOR, LLC, a relatively new entity, is performing this critical IT sustainment function. 5. This contract falls within the broader category of IT services supporting naval operations. 6. The contract duration of one year suggests a focus on immediate operational needs rather than long-term strategic IT development.

Value Assessment

Rating: fair

The contract's total value of approximately $34 million for a one-year period for IT facilities management services seems within a reasonable range for the Department of Defense. Benchmarking against similar contracts for IT sustainment and operations support reveals comparable pricing structures. However, without detailed performance metrics or a more robust competitive landscape, a definitive assessment of 'excellent' value is difficult. The firm fixed-price nature of the contract helps control costs for the government, but the lack of extensive competition may have prevented potentially lower prices or more innovative solutions.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which indicates a limited competition scenario. While not a sole-source award, the exclusion of certain sources suggests that the pool of potential bidders was restricted. The specific reasons for this exclusion are not detailed, but it implies that fewer than the maximum possible number of qualified contractors were considered. This limited competition may have impacted the government's ability to achieve the most competitive pricing and leverage a wider range of technical solutions.

Taxpayer Impact: The limited competition means taxpayers may not have benefited from the full potential of market-driven price reductions or the most innovative solutions that a broader competition might have yielded.

Public Impact

Naval personnel operating at sea benefit from the sustained IT infrastructure and services provided under this contract. The contract ensures the continuity of critical IT systems necessary for afloat operations, supporting the Navy's mission readiness. Geographic impact is primarily focused on naval vessels and associated shore facilities where these afloat operations are conducted. The contract supports IT professionals and technicians, potentially including roles within STRATASCOR, LLC and indirectly within the Navy's IT workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition could lead to higher costs for taxpayers.
The specific IT services and performance standards are not detailed, making it hard to assess effectiveness.
STRATASCOR, LLC's track record on similar large-scale DoD contracts is not readily available, posing a potential performance risk.

Positive Signals

The firm fixed-price contract type offers cost certainty to the government.
The contract supports essential IT infrastructure for naval operations, contributing to mission readiness.
The award was made after some form of competition, suggesting a degree of vetting.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on IT facilities management and sustainment services. The market for such services supporting defense operations is substantial, with numerous large and small companies vying for government contracts. Comparable spending benchmarks in this area are often in the tens to hundreds of millions of dollars annually for major defense IT support. This contract represents a specific, albeit significant, allocation of resources towards maintaining the operational IT capabilities of the Navy's afloat forces.

Small Business Impact

The data indicates that small business participation (ss: false, sb: false) was not a primary focus for this specific contract, as it was not set aside for small businesses, nor does it appear to have explicit subcontracting requirements for small businesses mentioned in the provided snippet. This suggests that the primary award went to a larger entity, and opportunities for small businesses may be limited unless they are direct subcontractors to STRATASCOR, LLC. The impact on the small business ecosystem is likely minimal for this particular award.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures are inherent in the firm fixed-price contract structure, which obligates the contractor to deliver specified services. Transparency is moderate; while the award is public, detailed performance reports and cost breakdowns are often not readily accessible to the public. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval IT Infrastructure Support
Defense IT Services
Afloat Operations Support Systems
Computer Facilities Management
IT Sustainment Contracts

Risk Flags

Limited Competition
Potential Performance Risk (Contractor Track Record)
Lack of Detailed Performance Metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.0 million to STRATASCOR, LLC. N102A WIGGINS N6 - AFLOAT OPERATIONS AND SUSTAINMENT 2023

Who is the contractor on this award?

The obligated recipient is STRATASCOR, 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 $34.0 million.

What is the period of performance?

Start: 2023-01-01. End: 2023-12-31.

What is STRATASCOR, LLC's performance history with the Department of Defense, particularly on similar IT sustainment contracts?

Information regarding STRATASCOR, LLC's specific performance history on large-scale Department of Defense IT sustainment contracts is not readily available in the public domain based on the provided data snippet. As a contractor, their past performance is a critical factor in contract awards. Agencies typically review past performance evaluations (e.g., CPARS - Contractor Performance Assessment Reporting System) when making decisions. Without access to these detailed evaluations or a longer history of significant contract awards, it is challenging to definitively assess their track record for this specific $34 million contract. Future performance will be key to establishing their reputation in this domain.

How does the $34 million contract value compare to similar IT afloat operations and sustainment contracts awarded by the Navy or other DoD branches?

Benchmarking the $34 million contract value requires comparing it against similar contracts for IT facilities management and sustainment services specifically for afloat operations within the Department of Defense. Contracts of this nature can vary significantly based on the scope of services, duration, number of systems supported, and specific technological requirements. While $34 million for a one-year contract is substantial, it appears to be within the expected range for supporting critical IT infrastructure on naval vessels. However, without detailed service level agreements and specific deliverables for this contract, a precise comparison is difficult. Contracts supporting larger fleets or more complex systems could range from tens to hundreds of millions annually.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Key risks associated with this contract include potential performance deficiencies by STRATASCOR, LLC, especially given potentially limited public track record, and the risk of the government not achieving optimal value due to limited competition. Technical risks related to maintaining complex afloat IT systems in challenging environments are also present. Mitigation strategies include the firm fixed-price contract type, which shifts some cost risk to the contractor. The Department of the Navy's program management and oversight are crucial for monitoring performance and addressing issues proactively. Contractual clauses for remedies and potential termination for default also serve as risk mitigation tools.

How effective is the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' approach in ensuring competitive pricing for IT sustainment services?

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' approach is a hybrid method that aims for broad competition while allowing for specific exclusions. While it is more competitive than a sole-source award, the exclusion of certain sources inherently limits the number of potential bidders. This limitation can reduce the pressure on the remaining bidders to offer the lowest possible prices or the most innovative solutions compared to truly unrestricted full and open competition. The effectiveness in ensuring competitive pricing depends heavily on the justification for the exclusions and the number of bidders that remain. If only a few bidders remain, the competitive dynamics might be weaker.

What is the historical spending trend for afloat operations and sustainment IT services within the Department of the Navy?

Analyzing historical spending trends for afloat operations and sustainment IT services within the Department of the Navy requires access to comprehensive budget and contract data over multiple fiscal years. Generally, spending in this area is expected to be significant and potentially increasing, driven by the Navy's continuous need to modernize and maintain its IT infrastructure across its fleet. Factors such as fleet size, technological advancements, cybersecurity requirements, and geopolitical demands influence these spending patterns. This $34 million contract represents a portion of that ongoing investment. Without specific historical data, it's difficult to pinpoint precise trends, but sustained investment in naval IT is a consistent requirement.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N3220518R1015

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3351 STONESHORE RD STE 203, VIRGINIA BEACH, VA, 23452

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $34,033,930

Exercised Options: $34,033,930

Current Obligation: $34,033,930

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N3220519D1000

IDV Type: IDC

Timeline