DoD's $32.2M C4IM Services Contract with Kaihonua LLC: A Deep Dive into Value and Competition

Contract Overview

Contract Amount: $32,211,111 ($32.2M)

Contractor: Kaihonua LLC

Awarding Agency: Department of Defense

Start Date: 2017-09-08

End Date: 2022-09-29

Contract Duration: 1,847 days

Daily Burn Rate: $17.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 20

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: TO PROVIDE COMMAND, CONTROL, COMMUNICATIONS, COMPUTER, AND INFORMATION MANAGEMENT (C4IM) SERVICES TO ORGANIZATIONS AND USERS SERVICED BY NETWORK ENTERPRISE CENTER-ROCK ISLAND (NEC-RI). IGF::OT::IGF

Place of Performance

Location: ROCK ISLAND, ROCK ISLAND County, ILLINOIS, 61299

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $32.2 million to KAIHONUA LLC for work described as: TO PROVIDE COMMAND, CONTROL, COMMUNICATIONS, COMPUTER, AND INFORMATION MANAGEMENT (C4IM) SERVICES TO ORGANIZATIONS AND USERS SERVICED BY NETWORK ENTERPRISE CENTER-ROCK ISLAND (NEC-RI). IGF::OT::IGF Key points: 1. The contract awarded to Kaihonua LLC for C4IM services represents a significant investment by the Department of the Army. 2. Competition was conducted under a 'full and open competition after exclusion of sources' model, suggesting a potentially limited but justified approach. 3. The fixed-price contract type aims to control costs, but the duration and specific services require careful monitoring for value. 4. The sector is IT services, specifically computer-related services, a critical area for modern military operations.

Value Assessment

Rating: fair

The contract's total value of $32.2 million over approximately 5 years needs to be benchmarked against similar C4IM service contracts. Without specific per-unit cost data or comparison points, assessing its pricing efficiency is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The 'full and open competition after exclusion of sources' indicates that while the competition was intended to be open, specific criteria or circumstances led to the exclusion of certain potential bidders. This method can impact price discovery by potentially narrowing the competitive landscape.

Taxpayer Impact: The total value of $32.2 million represents taxpayer funds allocated to essential C4IM services. Ensuring this spending is efficient and effective is crucial for responsible fiscal management.

Public Impact

Ensures critical command, control, and communication infrastructure for NEC-RI users. Supports military readiness and operational effectiveness through reliable IT services. Potential for cost savings or overruns depending on service delivery and contract management. Impacts users relying on C4IM services for daily operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises questions about optimal price discovery.
Lack of detailed per-unit cost data hinders value assessment.
Contract duration of 5 years requires ongoing performance monitoring.

Positive Signals

Fixed-price contract aims to control costs.
Services are critical for military operations.
Awarded by a major agency (Department of the Army).

Sector Analysis

This contract falls within the Information Technology sector, specifically 'Other Computer Related Services.' Spending in this area is substantial across the government, supporting everything from administrative functions to advanced defense systems. Benchmarks for similar C4IM services are essential for evaluating this contract's cost-effectiveness.

Small Business Impact

The data indicates this contract was not awarded to a small business (sb: false). Therefore, there is no direct analysis of small business participation or impact from this specific award.

Oversight & Accountability

Oversight would typically involve contract performance reviews, financial audits, and ensuring adherence to service level agreements. The Department of the Army's contracting office and NEC-RI are responsible for monitoring this contract's execution and accountability.

Related Government Programs

Other Computer Related Services
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Limited competitive landscape due to source exclusion.
Lack of detailed cost breakdown for value assessment.
Long contract duration requires sustained oversight.
Potential for vendor lock-in with C4IM services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.2 million to KAIHONUA LLC. TO PROVIDE COMMAND, CONTROL, COMMUNICATIONS, COMPUTER, AND INFORMATION MANAGEMENT (C4IM) SERVICES TO ORGANIZATIONS AND USERS SERVICED BY NETWORK ENTERPRISE CENTER-ROCK ISLAND (NEC-RI). IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is KAIHONUA LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $32.2 million.

What is the period of performance?

Start: 2017-09-08. End: 2022-09-29.

What specific metrics are used to measure the effectiveness and value of the C4IM services provided by Kaihonua LLC under this contract?

Effectiveness and value are typically measured through Service Level Agreements (SLAs) that define key performance indicators (KPIs) such as system uptime, response times for technical support, network performance, and user satisfaction. Regular performance reviews and user feedback mechanisms are crucial for assessing whether the services meet the required standards and provide adequate value for the $32.2 million investment.

How does the 'full and open competition after exclusion of sources' procurement method impact the potential for cost savings compared to a truly open competition?

This method, while allowing for broader participation than a sole-source award, can limit cost savings if the exclusion criteria significantly reduce the number of qualified bidders. A smaller pool of competitors may lead to less aggressive pricing. True 'full and open' competition, without exclusions, generally offers the greatest potential for competitive pricing and innovation by maximizing the number of potential offerors.

What are the primary risks associated with a long-term (1847 days) fixed-price contract for complex IT services like C4IM?

Key risks include scope creep, where requirements evolve beyond the initial contract scope, potentially leading to cost overruns if not managed carefully. There's also the risk of vendor lock-in, where the agency becomes overly reliant on a single provider. Furthermore, if the fixed price was set too low, the vendor might cut corners on service quality to maintain profitability, impacting system reliability and user experience.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W52P1J16R4002

Offers Received: 20

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 AARONA PL, KAILUA, HI, 96734

Business Categories: 8(a) Program Participant, Category Business, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Native Hawaiian Organization Owned Firm, Partnership or Limited Liability Partnership, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $32,211,111

Exercised Options: $32,211,111

Current Obligation: $32,211,111

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline