DoD's $603M contract for telecommunications services awarded to MULTIMAX INC. shows significant cost variance
Contract Overview
Contract Amount: $25,221,164 ($25.2M)
Contractor: Peraton Inc.
Awarding Agency: Department of Defense
Start Date: 2005-09-12
End Date: 2009-03-27
Contract Duration: 1,292 days
Daily Burn Rate: $19.5K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 18
Pricing Type: LABOR HOURS
Sector: IT
Official Description: 200511!001097!5700!FA8604!ASC/PKW !FA877104D0003 !A!N! !Y!SC06 ! !20050912!20060927!602938771!602938771!602938771!N!MULTIMAX INC !1441 MCCORMICK DR !LARGO !MD!20774!86660!057!39!WRIGHT PATTERSON AFB!GREENE !OHIO !+000001217000!N!N!000000000000!D399!OTHER ADP & TELECOMMUNICATION SERVICES !S1 !SERVICES !000 !* !541519!E! !5!B!M! !A! !20200930!B!F!Y!A! !A!N!Z!2!018!K! !Z!N!Z! ! !N!A!N!N!B! ! ! !C!A!000!A!B!N! ! ! ! ! ! !0001! !
Place of Performance
Location: STERLING, LOUDOUN County, VIRGINIA, 20166
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $25.2 million to PERATON INC. for work described as: 200511!001097!5700!FA8604!ASC/PKW !FA877104D0003 !A!N! !Y!SC06 ! !20050912!20060927!602938771!602938771!602938771!N!MULTIMAX INC !1441 MCCORMICK DR !LARGO !MD!20774!86660!057!39!WRIGHT PATTERSON AFB!GREE… Key points: 1. The contract's total value of $603 million over its lifecycle suggests a substantial investment in telecommunications infrastructure. 2. Competition dynamics indicate a 'full and open competition after exclusion of sources,' which may limit the pool of eligible bidders. 3. The contract's duration of 1292 days (approximately 3.5 years) points to a long-term need for these services. 4. Performance context is linked to WRIGHT PATTERSON AFB, suggesting a critical operational support role. 5. Sector positioning places this contract within 'Other ADP & Telecommunication Services,' a broad category encompassing various IT and communication needs. 6. The contract was awarded under the 'Services' category, implying a focus on labor and expertise rather than physical goods.
Value Assessment
Rating: questionable
The contract's total value of $603 million is substantial. Without specific performance metrics or detailed cost breakdowns, it's difficult to benchmark the value for money. The raw dollar amount alone doesn't provide insight into efficiency. Further analysis would be needed to compare this to similar contracts for telecommunications services at other military installations or for comparable government agencies.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This designation suggests that while the competition was intended to be open, certain sources were excluded, potentially limiting the number of bidders. The specific reasons for exclusion are not detailed, but this approach can sometimes lead to less competitive pricing if the excluded sources represent significant market players.
Taxpayer Impact: The limited competition may have resulted in higher prices for taxpayers compared to a truly open competition with all potential vendors participating. This could mean less efficient use of public funds.
Public Impact
The primary beneficiaries are likely military personnel and operations at WRIGHT PATTERSON AFB, who rely on robust telecommunications. Services delivered include 'OTHER ADP & TELECOMMUNICATION SERVICES,' which could encompass network management, data transmission, and communication support. The geographic impact is centered around WRIGHT PATTERSON AFB in OHIO, supporting its mission-critical functions. Workforce implications could involve the need for skilled IT and telecommunications professionals to manage and maintain the contracted services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition due to source exclusion could lead to suboptimal pricing.
- Lack of detailed performance metrics makes value assessment challenging.
- The significant contract value warrants close monitoring for cost overruns or inefficiencies.
Positive Signals
- Awarded to a single contractor, MULTIMAX INC., suggesting a focused relationship for service delivery.
- Contract duration indicates a stable, long-term requirement, potentially leading to contractor investment in service quality.
- The 'Services' designation implies a focus on expertise and operational support.
Sector Analysis
This contract falls within the broader Information Technology and Telecommunications sector, specifically 'Other ADP & Telecommunication Services.' This sector is characterized by rapid technological advancements and a high demand for reliable communication networks, especially within government and defense. Comparable spending benchmarks would involve analyzing other large-scale telecommunications contracts awarded by the DoD or other federal agencies for similar operational support.
Small Business Impact
The provided data does not indicate any specific small business set-aside provisions or subcontracting requirements for this contract. Therefore, the direct impact on the small business ecosystem is unclear from this information alone. It's possible that larger prime contractors may engage small businesses for specific components of the service, but this is not explicitly stated.
Oversight & Accountability
Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), as indicated by the 'sa' field. Accountability measures would be defined within the contract's terms and conditions, including performance standards and reporting requirements. Transparency is often enhanced through contract databases like FPDS, but detailed operational oversight mechanisms are internal to the agency and contractor.
Related Government Programs
- Defense Information Systems Agency (DISA) contracts
- General Services Administration (GSA) IT Schedule contracts
- Other DoD telecommunications and network support contracts
Risk Flags
- Potential for suboptimal pricing due to limited competition.
- Risk of technological obsolescence over the contract's duration.
- Lack of detailed performance metrics hinders value assessment.
Tags
dod, defense, telecommunications, it-services, wright-patterson-afb, ohio, full-and-open-competition-after-exclusion-of-sources, services, large-contract, multiyear
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $25.2 million to PERATON INC.. 200511!001097!5700!FA8604!ASC/PKW !FA877104D0003 !A!N! !Y!SC06 ! !20050912!20060927!602938771!602938771!602938771!N!MULTIMAX INC !1441 MCCORMICK DR !LARGO !MD!20774!86660!057!39!WRIGHT PATTERSON AFB!GREENE !OHIO !+000001217000!N!N!000000000000!D399!OTHER ADP & TELECOMMUNICATION SERVICES !S1 !SERVICES !000 !* !541519!E! !5!B!M! !A! !202
Who is the contractor on this award?
The obligated recipient is PERATON 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 $25.2 million.
What is the period of performance?
Start: 2005-09-12. End: 2009-03-27.
What was the specific justification for excluding certain sources in this 'full and open competition after exclusion of sources' award?
The provided data does not specify the exact reasons for excluding certain sources in this contract award. Typically, such exclusions are based on factors like unique capabilities, proprietary technology, or specific security requirements that only a limited number of vendors can meet. Without further documentation or agency açıklama, it's impossible to determine the precise rationale. This lack of transparency regarding source exclusion can raise concerns about the extent of competition and potential impact on pricing for taxpayers.
How does the awarded price of $603 million compare to market rates for similar telecommunications services over the contract's duration?
Benchmarking the $603 million contract value against market rates for similar telecommunications services over its 1292-day duration (approximately 3.5 years) is challenging without more granular data. Factors such as the specific technologies deployed, service level agreements (SLAs), geographic coverage, and security requirements significantly influence pricing. However, a contract of this magnitude suggests a comprehensive suite of services. A detailed analysis would involve comparing the per-unit costs of specific services (e.g., bandwidth, network management hours) against industry benchmarks and other government contracts for comparable scope and scale.
What are the key performance indicators (KPIs) associated with this contract, and how has MULTIMAX INC. performed against them?
The provided data does not include specific Key Performance Indicators (KPIs) for this contract or details on MULTIMAX INC.'s performance. Typically, government contracts outline measurable performance standards related to service availability, response times, network uptime, and security compliance. The Defense Contract Management Agency (DCMA) would likely oversee adherence to these KPIs. Without access to performance reports or contract modifications, it's not possible to assess the contractor's track record or the effectiveness of the telecommunications services delivered.
What is the historical spending pattern for 'Other ADP & Telecommunication Services' at WRIGHT PATTERSON AFB?
To assess the historical spending pattern for 'Other ADP & Telecommunication Services' at WRIGHT PATTERSON AFB, one would need to analyze contract data for this specific location and service category over several fiscal years. This contract, awarded in 2005 with a significant value, suggests a substantial and ongoing need. Examining prior and subsequent contracts for similar services would reveal trends in spending, potential increases or decreases in demand, and the evolution of technology requirements, providing context for the $603 million award.
What are the potential risks associated with a long-duration contract for telecommunications services, especially concerning technological obsolescence?
Long-duration contracts for telecommunications services, like this one spanning over three years, carry inherent risks, particularly regarding technological obsolescence. The telecommunications landscape evolves rapidly, and technologies that are cutting-edge at the time of award can become outdated before the contract concludes. This can lead to the government paying for services or equipment that are no longer optimal or efficient. Mitigating this risk often involves contract clauses that allow for technology refreshes, service level adjustments, or periodic re-competition to ensure the government benefits from current advancements.
Industry Classification
NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 18
Pricing Type: LABOR HOURS (Z)
Evaluated Preference: NONE
Contractor Details
Parent Company: L3harris Technologies, Inc (UEI: 004203337)
Address: 21000 ATLANTIC BLVD STE 300, DULLES, VA, 10
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Parent Contract
Parent Award PIID: FA877104D0003
IDV Type: IDC
Timeline
Start Date: 2005-09-12
Current End Date: 2009-03-27
Potential End Date: 2009-03-27 00:00:00
Last Modified: 2013-11-25
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