State Department's $121.9M Software ELA with CDW Government LLC Raises Questions on Value and Competition
Contract Overview
Contract Amount: $121,943,033 ($121.9M)
Contractor: CDW Government LLC
Awarding Agency: Department of State
Start Date: 2016-01-01
End Date: 2019-02-28
Contract Duration: 1,154 days
Daily Burn Rate: $105.7K/day
Competition Type: COMPETED UNDER SAP
Number of Offers Received: 6
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: DEPARTMENT OF STATE ENTERPRISE LICENSE AGREEMENT (ELA)
Place of Performance
Location: VERNON HILLS, LAKE County, ILLINOIS, 60061
State: Illinois Government Spending
Plain-Language Summary
Department of State obligated $121.9 million to CDW GOVERNMENT LLC for work described as: DEPARTMENT OF STATE ENTERPRISE LICENSE AGREEMENT (ELA) Key points: 1. The $121.9 million Enterprise License Agreement (ELA) for software with CDW Government LLC represents a significant investment by the Department of State. 2. Competition appears limited, as the award was made under a BPA Call, suggesting pre-existing contract vehicles. 3. The fixed-price contract type mitigates some cost overrun risks, but the lack of detailed competition information warrants scrutiny. 4. The sector is IT, specifically software procurement, which is a common area for large government contracts.
Value Assessment
Rating: questionable
The total award of $121.9 million over approximately three years is substantial. Without specific unit pricing or comparison to similar ELAs, it's difficult to assess if this represents a fair market price. The lack of detailed justification for the price in the provided data makes evaluation challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was competed under SAP (Small Acquisition Procedures) and awarded via a BPA Call. This suggests that competition may have been restricted to vendors already on a Blanket Purchase Agreement, potentially limiting broader market engagement and price discovery.
Taxpayer Impact: The significant expenditure of taxpayer funds on this ELA necessitates a thorough review to ensure it provides optimal value and was procured competitively.
Public Impact
Taxpayers may be paying above market rates due to limited competition in the procurement process. The Department of State's reliance on a single vendor for a large software ELA could lead to vendor lock-in. Lack of transparency in the procurement process hinders public trust and accountability for the substantial expenditure.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition
- Lack of price justification
- Potential for vendor lock-in
Positive Signals
- Firm Fixed Price contract type
- Clear awardee identified
Sector Analysis
This contract falls within the Information Technology sector, specifically software licensing. Government IT spending is consistently high, and ELAs are common for managing software across agencies. Benchmarks for similar ELAs are crucial for assessing value.
Small Business Impact
The data indicates this contract was not set-aside for small businesses (sb: false). Therefore, small businesses likely had limited direct opportunity to compete for this specific ELA, though they may be involved as subcontractors.
Oversight & Accountability
Oversight is critical for large ELAs. The Department of State should have internal mechanisms to monitor software usage, vendor performance, and ensure compliance with contract terms to safeguard taxpayer funds.
Related Government Programs
- Computer and Computer Peripheral Equipment and Software Merchant Wholesalers
- Department of State Contracting
- Department of State Programs
Risk Flags
- Lack of detailed justification for pricing.
- Limited competitive process indicated.
- Potential for non-optimal pricing due to procurement method.
- No clear indication of small business participation.
- Significant dollar value warrants higher scrutiny.
Tags
computer-and-computer-peripheral-equipme, department-of-state, il, bpa-call, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of State awarded $121.9 million to CDW GOVERNMENT LLC. DEPARTMENT OF STATE ENTERPRISE LICENSE AGREEMENT (ELA)
Who is the contractor on this award?
The obligated recipient is CDW GOVERNMENT LLC.
Which agency awarded this contract?
Awarding agency: Department of State (Department of State).
What is the total obligated amount?
The obligated amount is $121.9 million.
What is the period of performance?
Start: 2016-01-01. End: 2019-02-28.
What specific software products are covered under this ELA, and how does the $121.9 million cost compare to market rates for these products?
The provided data does not specify the software products included in the ELA. To assess value, a detailed breakdown of the software suite and its pricing against industry benchmarks is necessary. Without this, it's impossible to determine if the $121.9 million represents a fair market price or if taxpayers are overpaying for the software licenses.
What was the justification for using a BPA Call and Small Acquisition Procedures, and what efforts were made to ensure maximum competition?
Using a BPA Call and SAP suggests a streamlined procurement process, potentially limiting the pool of eligible vendors. The justification likely centers on efficiency or existing agreements. However, it raises concerns about whether a broader competition could have yielded better pricing or terms for the Department of State and, by extension, the taxpayers.
How will the Department of State ensure effective utilization and management of the software procured under this ELA to maximize its value?
Effective utilization requires robust asset management and usage tracking. The Department should implement policies and tools to monitor software deployment, identify underutilized licenses, and ensure the software aligns with agency needs. Regular reviews of the ELA's performance against objectives are crucial for maximizing the return on this significant investment.
Industry Classification
NAICS: Wholesale Trade › Professional and Commercial Equipment and Supplies Merchant Wholesalers › Computer and Computer Peripheral Equipment and Software Merchant Wholesalers
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: COMPETED UNDER SAP
Solicitation Procedures: SIMPLIFIED ACQUISITION
Offers Received: 6
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: CDW Corporation
Address: 230 N MILWAUKEE AVE, VERNON HILLS, IL, 60061
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $121,943,033
Exercised Options: $121,943,033
Current Obligation: $121,943,033
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: SAQMMA16A0070
IDV Type: BPA
Timeline
Start Date: 2016-01-01
Current End Date: 2019-02-28
Potential End Date: 2019-02-28 00:00:00
Last Modified: 2022-09-06
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