Navy awards $34.6M IT support contract to Illumina Solutions for engineering, QA, and project management

Contract Overview

Contract Amount: $34,562,369 ($34.6M)

Contractor: Ilumina Solutions Incorporated

Awarding Agency: Department of Defense

Start Date: 2011-05-09

End Date: 2014-09-30

Contract Duration: 1,240 days

Daily Burn Rate: $27.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: NAVY ERP SYSTEMS ENGINEERING, QA TEST, IT AND ARCHITECTURE, AND PROJECT MANAGEMENT SUPPORT (SQIP)

Place of Performance

Location: ANNAPOLIS, ANNE ARUNDEL County, MARYLAND, 21401, UNITED STATES OF AMERICA

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $34.6 million to ILUMINA SOLUTIONS INCORPORATED for work described as: NAVY ERP SYSTEMS ENGINEERING, QA TEST, IT AND ARCHITECTURE, AND PROJECT MANAGEMENT SUPPORT (SQIP) Key points: 1. Contract value of $34.6M over approximately 3.4 years indicates a significant investment in IT infrastructure support. 2. Full and open competition suggests a robust market for these services, potentially leading to competitive pricing. 3. The contract type (Cost Plus Fixed Fee) carries inherent risk of cost overruns, requiring close oversight. 4. Performance period of over three years allows for sustained support but also necessitates ongoing performance monitoring. 5. The award to Illumina Solutions Inc. positions them as a key IT service provider for the Department of the Navy. 6. Engineering Services (NAICS 541330) is a broad category, suggesting a wide range of technical expertise was required.

Value Assessment

Rating: fair

Benchmarking the value of this $34.6M contract is challenging without specific service details and comparable contract data. However, the Cost Plus Fixed Fee (CPFF) contract type introduces a degree of risk, as costs can escalate beyond initial estimates, potentially impacting overall value for money. The fixed fee component provides some cost certainty for the contractor, but the government bears the risk of increased labor and material costs. Further analysis would require comparing the per-unit costs of specific services rendered against market rates or similar government contracts.

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 approach generally fosters a competitive environment, encouraging multiple bidders to offer their best pricing and technical solutions. The presence of three bidders (no) suggests a reasonable level of competition for this specific requirement, which should have contributed to price discovery and a more favorable outcome for the government.

Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down prices through market forces and encouraging innovation from a wider pool of contractors.

Public Impact

The Department of the Navy benefits from enhanced IT systems engineering, quality assurance, testing, and project management capabilities. This contract supports the modernization and maintenance of critical IT infrastructure essential for naval operations. The geographic impact is likely concentrated around Navy installations where these IT services are deployed and managed. The contract supports a workforce skilled in IT, engineering, and project management, contributing to specialized employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type introduces potential for cost overruns if not managed diligently.
Lack of specific performance metrics makes it difficult to assess the contractor's efficiency and effectiveness.
The broad nature of 'Engineering Services' could lead to scope creep if not clearly defined and managed.

Positive Signals

Awarded under full and open competition, suggesting a competitive bidding process.
Multiple bidders participated, indicating market interest and potential for competitive pricing.
The contract duration allows for sustained support and relationship building with the contractor.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), a significant segment of the federal IT and professional services market. The Department of Defense, and specifically the Navy, are major consumers of these services for maintaining and upgrading complex technological systems. The market for IT support, engineering, and project management is highly competitive, with numerous firms vying for government contracts. Benchmarks for similar IT support contracts within the DoD often range from tens to hundreds of millions of dollars, depending on scope and duration.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a result, large businesses likely dominated the bidding process. While there is no direct indication of subcontracting requirements for small businesses, it is common for larger prime contractors to engage small businesses for specialized IT services. The absence of a small business set-aside means that opportunities for direct prime contracting with the government were limited for small businesses on this specific award.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract would typically involve the Department of the Navy's contracting officers and program managers. They are responsible for monitoring costs, ensuring compliance with contract terms, and verifying the quality of services delivered. The contract's duration allows for ongoing performance reviews. Transparency is generally maintained through contract award databases, though detailed performance reports may not always be publicly accessible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Navy IT Modernization Programs
Department of Defense Enterprise IT Services
Naval Sea Systems Command (NAVSEA) Support Contracts
IT Project Management Services
Quality Assurance and Testing Services

Risk Flags

Cost Plus Fixed Fee contract type carries inherent cost overrun risk.
Broad 'Engineering Services' classification may require stringent scope management.
Limited public data on specific performance metrics makes value assessment challenging.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.6 million to ILUMINA SOLUTIONS INCORPORATED. NAVY ERP SYSTEMS ENGINEERING, QA TEST, IT AND ARCHITECTURE, AND PROJECT MANAGEMENT SUPPORT (SQIP)

Who is the contractor on this award?

The obligated recipient is ILUMINA SOLUTIONS INCORPORATED.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $34.6 million.

What is the period of performance?

Start: 2011-05-09. End: 2014-09-30.

What is the track record of Illumina Solutions Incorporated with the Department of Defense?

Illumina Solutions Incorporated has a history of performing contracts with the Department of Defense, including this specific award for IT support. Analyzing their past performance on similar contracts, particularly those involving engineering, QA, testing, and project management, would provide insight into their reliability and capability. Reviewing past performance evaluations and any documented issues or successes would be crucial. Without access to specific past performance data beyond the award itself, it's difficult to provide a detailed assessment, but the award suggests they met the DoD's requirements at the time of bidding.

How does the $34.6M value compare to similar Navy IT support contracts?

The $34.6 million value for approximately 3.4 years of IT support services (engineering, QA, testing, project management) is a substantial but not extraordinary figure for a Department of the Navy contract. The Navy manages vast and complex IT systems, often requiring significant investment in support services. Comparable contracts can range widely, from smaller, specialized task orders to multi-billion dollar enterprise-wide agreements. This contract appears to be of moderate to large size within the context of specific IT support functions for a particular command or program, rather than an overarching enterprise IT services contract.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for IT services?

The primary risk with a CPFF contract for IT services is the potential for cost overruns. While the contractor receives a fixed fee, the government bears the risk of increased labor, material, and other direct costs incurred in performing the work. If the contractor's actual costs exceed estimates, the government pays those higher costs. This necessitates robust government oversight to ensure costs are reasonable and allocable to the contract. Scope creep, where the project's requirements expand beyond the original agreement, can exacerbate cost increases under a CPFF structure if not managed tightly.

How effective is full and open competition in ensuring value for taxpayer money in IT services?

Full and open competition is generally considered the most effective method for ensuring value for taxpayer money in IT services. By allowing all responsible sources to bid, it maximizes the pool of potential contractors, fostering a competitive environment that drives down prices and encourages innovation. This process allows the government to solicit proposals based on clearly defined requirements and evaluate them on technical merit and cost. While it requires significant effort in solicitation and evaluation, the resulting competition typically leads to better pricing and higher quality services compared to less competitive procurement methods.

What is the historical spending trend for engineering and IT support services by the Department of the Navy?

The Department of the Navy historically spends billions of dollars annually on engineering, IT, and related support services. This spending is driven by the need to maintain, upgrade, and secure its vast array of platforms, systems, and infrastructure. Trends often show increasing investment in cybersecurity, cloud computing, data analytics, and modern IT architectures. Contracts for services like those provided by Illumina Solutions are a consistent component of this spending, reflecting the ongoing need for specialized technical expertise to support complex naval operations and administrative functions.

What are the implications of the 'Engineering Services' classification (NAICS 541330) for this contract?

The classification of 'Engineering Services' (NAICS 541330) indicates that the contract likely involves a broad range of technical and professional services related to the design, development, analysis, and management of systems and infrastructure. For this Navy contract, it suggests that Illumina Solutions is expected to provide expertise in areas such as systems engineering, requirements analysis, technical assessments, quality assurance, testing, and potentially project management oversight for IT systems. This classification allows for flexibility in the types of specialized engineering skills that can be applied to meet the Navy's evolving IT needs.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering 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

Solicitation ID: N0002410R3479

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: ECS Federal, LLC (UEI: 806026852)

Address: 23330 COTTONWOOD PKWY STE 350, CALIFORNIA, MD, 20619

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Hispanic American Owned Business, Minority Owned Business, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $38,584,996

Exercised Options: $37,746,765

Current Obligation: $34,562,369

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017810D6087

IDV Type: IDC

Timeline