DoD's Navy awards $21.3M for afloat ops IT, raising value-for-money questions

Contract Overview

Contract Amount: $21,331,229 ($21.3M)

Contractor: Stratascor, LLC

Awarding Agency: Department of Defense

Start Date: 2025-01-01

End Date: 2025-06-30

Contract Duration: 180 days

Daily Burn Rate: $118.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: FY25 AFLOAT OPS 6 MONTH TASK ORDER

Place of Performance

Location: CHESAPEAKE, CHESAPEAKE CITY County, VIRGINIA, 23320

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $21.3 million to STRATASCOR, LLC for work described as: FY25 AFLOAT OPS 6 MONTH TASK ORDER Key points: 1. Contract value appears high relative to duration and scope, warranting further value-for-money assessment. 2. Limited competition dynamics may have influenced pricing, as the contract was competed after excluding sources. 3. Risk indicators include the contract's short duration and the specific nature of the services, suggesting potential for future adjustments or re-competition. 4. Performance context is limited due to the early stage of the contract, but the firm-fixed-price structure aims to control costs. 5. Sector positioning places this within IT services, specifically computer facilities management, a common but critical area for defense operations.

Value Assessment

Rating: fair

The contract's value of $21.3 million for a six-month period averages over $3.5 million per month. Benchmarking against similar IT facilities management contracts for naval operations is challenging without more detailed service descriptions. However, the per-month cost seems substantial, suggesting a need to scrutinize the specific services delivered and compare them to industry standards for afloat IT support. The firm-fixed-price nature provides cost certainty, but the overall value proposition requires deeper analysis of the deliverables against the price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while competition was sought, certain sources were intentionally excluded. This approach typically suggests a specific reason, such as prior performance, unique capabilities, or a desire to consolidate existing contracts. The limited number of bidders resulting from source exclusion can impact price discovery and potentially lead to higher costs compared to unrestricted full and open competition.

Taxpayer Impact: Taxpayers may face higher costs due to the restricted competitive pool. The exclusion of potential bidders limits the government's ability to secure the most competitive pricing available in the broader market.

Public Impact

Naval personnel operating afloat will benefit from enhanced IT facilities management, crucial for mission readiness. Services delivered include computer facilities management, supporting the operational technology infrastructure on naval vessels. Geographic impact is global, as naval operations span worldwide theaters. Workforce implications are primarily for the contractor, STRATASCOR, LLC, who will be responsible for delivering these specialized IT services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may have inflated costs.
Short contract duration could indicate a need for future re-competition or scope adjustments.
Reliance on a single contractor for critical afloat IT infrastructure poses a risk if performance falters.

Positive Signals

Firm-fixed-price contract type provides cost certainty.
STRATASCOR, LLC is the awardee, suggesting potential past performance or existing relationship.
Focus on essential afloat operations IT supports critical military functions.

Sector Analysis

This contract falls within the IT services sector, specifically Computer Facilities Management Services (NAICS 541513). This is a vital segment for government operations, particularly defense, where reliable IT infrastructure is paramount for command, control, and communication. The market for these services is competitive, but specialized requirements for defense, such as afloat operations, can create niche markets. Comparable spending benchmarks would typically involve analyzing other DoD contracts for similar IT support on naval vessels or other deployed platforms.

Small Business Impact

The data indicates that small business participation (sb) is false, and there is no indication of a small business set-aside (ss). This suggests the contract was not specifically targeted towards small businesses. Consequently, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. The award to STRATASCOR, LLC, a company whose size is not specified here, means the primary contract value does not directly flow down to the small business ecosystem through set-aside requirements.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy contracting officers and program managers. Accountability measures are embedded in the firm-fixed-price contract type, which obligates the contractor to deliver specified services at an agreed-upon price. Transparency is generally facilitated through contract databases like FPDS, where award details are published. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Navy IT Modernization Programs
Defense Information Systems Agency (DISA) Contracts
Shipboard IT Infrastructure Support
Afloat Communications Services
Naval Sea Systems Command (NAVSEA) IT Services

Risk Flags

Limited competition may result in suboptimal pricing.
Short contract duration raises questions about long-term strategy and potential for disruption.
Dependence on a single contractor for critical infrastructure poses performance risk.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.3 million to STRATASCOR, LLC. FY25 AFLOAT OPS 6 MONTH TASK ORDER

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 $21.3 million.

What is the period of performance?

Start: 2025-01-01. End: 2025-06-30.

What is STRATASCOR, LLC's track record with similar afloat IT operations contracts?

Assessing STRATASCOR, LLC's track record with similar afloat IT operations contracts requires a deeper dive into their past performance history, specifically within the Department of Defense and the Navy. While this award indicates they were selected, it doesn't detail their success on prior, comparable engagements. Information on previous contract values, durations, client satisfaction, and any performance issues or awards would be crucial. Without this data, it's difficult to definitively assess their capability and reliability for this specific $21.3 million, six-month task order. Further investigation into their contract history, including any past performance reviews or debriefings from previous solicitations, would provide a clearer picture of their suitability and potential risks associated with their engagement.

How does the $3.5 million monthly cost compare to industry benchmarks for afloat IT facilities management?

The approximate $3.5 million monthly cost for this contract is substantial and warrants comparison against industry benchmarks for afloat IT facilities management. However, obtaining precise benchmarks is challenging due to the unique operational environment of naval vessels and the specific scope of services. Factors influencing cost include the complexity of the IT systems, the number of users supported, cybersecurity requirements, and the logistical challenges of providing support at sea. A comprehensive benchmark would ideally involve analyzing data from similar contracts awarded by the Navy or other maritime defense organizations. Without access to proprietary cost data or detailed service level agreements from comparable contracts, it's difficult to definitively state whether this rate is high or low. However, given the specialized nature, it is likely to be at a premium compared to land-based IT support.

What specific risks are associated with the 'Full and Open Competition After Exclusion of Sources' award method?

The 'Full and Open Competition After Exclusion of Sources' award method introduces specific risks. Primarily, it limits the pool of potential bidders, which can reduce overall competition and potentially lead to higher prices than if all qualified sources were allowed to compete. The exclusion of sources implies a deliberate decision based on criteria that may not always be transparent or objectively justifiable, potentially leading to protests or perceptions of unfairness. Furthermore, if the excluded sources possessed unique or superior capabilities, the government might miss out on the best possible solution. This method also requires robust justification for the exclusion to withstand scrutiny, and any perceived impropriety can damage contractor trust and future competition.

What is the expected impact of this contract on naval operational readiness and IT system reliability?

This contract is expected to have a positive impact on naval operational readiness by ensuring the reliable functioning of IT facilities management for afloat units. Effective IT support is critical for navigation, communication, intelligence gathering, logistics, and combat systems. By awarding this contract, the Navy aims to maintain and potentially improve the performance and availability of these essential systems, thereby directly supporting mission execution. The contractor's role in managing computer facilities, including hardware, software, and network infrastructure, is crucial for minimizing downtime and ensuring that sailors have the technological tools they need to operate effectively in diverse and demanding environments worldwide.

How has the Navy's spending on afloat IT operations evolved over the past five fiscal years?

Analyzing the Navy's spending on afloat IT operations over the past five fiscal years requires access to historical contract data, which is not fully provided in the current dataset. However, general trends in defense spending suggest a consistent and likely increasing investment in IT capabilities, especially for operational platforms. Factors driving this include the growing reliance on networked systems, the need for advanced cybersecurity, and the modernization of naval assets. To provide a precise evolution, one would need to aggregate data for similar contract types (e.g., IT services, computer facilities management, communications support) awarded to afloat units across multiple fiscal years. This would reveal spending patterns, identify key contractors, and highlight any shifts in technology or service requirements.

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 - IT MANAGEMENT

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: $21,331,229

Exercised Options: $21,331,229

Current Obligation: $21,331,229

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N3220519D1000

IDV Type: IDC

Timeline