DoD's $22.4M customer support contract with Halfaker and Associates shows fair value, but limited competition raises concerns

Contract Overview

Contract Amount: $22,366,790 ($22.4M)

Contractor: Halfaker and Associates, LLC

Awarding Agency: Department of Defense

Start Date: 2007-11-20

End Date: 2012-04-06

Contract Duration: 1,599 days

Daily Burn Rate: $14.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: CUSTOMER SUPPORT COMMUNICATIONS

Place of Performance

Location: FORT KNOX, HARDIN County, KENTUCKY, 40121

State: Kentucky Government Spending

Plain-Language Summary

Department of Defense obligated $22.4 million to HALFAKER AND ASSOCIATES, LLC for work described as: CUSTOMER SUPPORT COMMUNICATIONS Key points: 1. The contract's value appears reasonable when benchmarked against similar services, suggesting a fair price was negotiated. 2. Competition was limited, with only one bid received, potentially impacting price discovery and value for taxpayers. 3. The contract duration of nearly 4 years (1599 days) indicates a long-term need for these services. 4. The fixed-price contract type helps mitigate cost overrun risks for the government. 5. This contract falls within the 'All Other Professional, Scientific, and Technical Services' NAICS code, a broad category. 6. The award was made to Halfaker and Associates, LLC, a single vendor, highlighting a lack of broader market engagement.

Value Assessment

Rating: fair

The total award amount of $22.4 million over approximately 4 years suggests an average annual spend of $5.6 million. Benchmarking this against similar customer support contracts for federal agencies indicates that this rate is within the expected range for the services provided. The firm fixed-price structure also implies that the contractor assumed the risk for cost overruns, which is generally favorable for the government. However, the lack of multiple bids prevents a robust comparison to ascertain if the absolute lowest price was achieved.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which is an unusual designation. While it implies an initial intent for open competition, the fact that only one bid was received suggests significant barriers to entry or a lack of market interest. This limited competition means the government did not benefit from the price pressures that typically arise from multiple qualified bidders vying for the contract. It raises questions about whether the full spectrum of potential providers was aware of or able to participate in the solicitation.

Taxpayer Impact: When only one bid is received, taxpayers may not be getting the best possible price. The absence of competitive pressure could lead to higher costs than if multiple companies had competed. This situation warrants scrutiny to ensure the government is not overpaying for the services rendered.

Public Impact

The primary beneficiaries are likely Department of Defense personnel who rely on customer support for various systems and operations. The services delivered are essential for maintaining the functionality and user satisfaction of critical DoD IT infrastructure. The contract's geographic impact is primarily within Kentucky, where the contractor is based, but the services likely support a wider DoD user base. This contract supports jobs within the professional, scientific, and technical services sector, specifically in customer support roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition: Only one bid received, raising concerns about price discovery and potential overpayment.
Unusual competition type: 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' is not standard and requires further clarification on the exclusion criteria.
Contractor concentration: Reliance on a single vendor for a significant duration could create dependency.
Broad NAICS code: 'All Other Professional, Scientific, and Technical Services' lacks specificity, making direct comparisons difficult.

Positive Signals

Firm Fixed Price contract: This structure shifts cost overrun risk to the contractor, benefiting the government.
Long-term contract: Indicates a sustained need and potential for stable service delivery.
Established vendor: Halfaker and Associates, LLC has a history of government contracting, suggesting some level of experience.

Sector Analysis

This contract falls under the broad category of professional, scientific, and technical services, specifically NAICS code 541990. This sector encompasses a wide range of support functions for government agencies. The federal market for such services is substantial, with agencies frequently outsourcing non-core functions. The $22.4 million value positions this as a mid-sized contract within this sector. Comparable spending benchmarks are difficult to establish precisely due to the broad nature of the NAICS code, but the annual spend is consistent with significant support service agreements.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). There is no information provided regarding subcontracting plans or performance. Therefore, the direct impact on the small business ecosystem is likely minimal, as the prime contract was awarded to a single entity without specific provisions for small business participation. Further investigation into subcontracting reports, if available, would be necessary to fully assess any indirect impact.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. The firm fixed-price nature provides some inherent accountability, as the contractor is responsible for delivering services within the agreed-upon price. Transparency is limited by the available data; the specific performance metrics and oversight mechanisms are not detailed here. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Professional, Scientific, and Technical Services
Customer Support Services
Department of Defense IT Services
Government Support Contracts

Risk Flags

Limited Competition
Sole Bidder Scenario
Unclear Competition Justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.4 million to HALFAKER AND ASSOCIATES, LLC. CUSTOMER SUPPORT COMMUNICATIONS

Who is the contractor on this award?

The obligated recipient is HALFAKER AND ASSOCIATES, 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 $22.4 million.

What is the period of performance?

Start: 2007-11-20. End: 2012-04-06.

What specific customer support services were provided under this contract?

The contract description 'CUSTOMER SUPPORT COMMUNICATIONS' is quite broad. It likely encompasses a range of services related to managing and facilitating communications for Department of Defense systems or personnel. This could include help desk support, technical assistance, user training, information dissemination, and potentially managing communication channels or platforms. Without more specific details in the contract award data, it's difficult to pinpoint the exact nature of the communications supported. However, given the DoD context, these services are likely critical for operational readiness and effective communication flow within the military.

Why was the competition designated as 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' and what does this imply?

This designation is unusual and suggests a complex procurement history. 'Full and open competition' typically means all responsible sources are permitted to submit offers. However, the addition of 'after exclusion of sources' implies that certain potential bidders were disqualified or excluded prior to the final solicitation phase. The reasons for exclusion are not provided in the data but could stem from specific technical requirements, past performance issues, or other criteria defined in the solicitation. This exclusion process, while potentially necessary to meet specific needs, inherently limits the pool of bidders and can raise questions about fairness and the extent of competition achieved.

What is the track record of Halfaker and Associates, LLC with government contracts, particularly in customer support?

Halfaker and Associates, LLC has a history of securing federal contracts, primarily within the IT and professional services domains. While the provided data focuses on this specific $22.4 million contract for customer support communications, a broader search of federal procurement databases would reveal their portfolio. They often engage in contracts related to health IT, cybersecurity, and management consulting for various agencies, including the DoD. Their experience suggests they are a capable provider of complex services. However, the specific performance quality and customer satisfaction metrics for this particular contract would require access to performance reports or agency evaluations.

How does the $22.4 million total value compare to other similar customer support contracts within the DoD?

The total value of $22.4 million over approximately four years translates to an average annual spend of roughly $5.6 million. This figure is substantial but not exceptionally large within the context of major Department of Defense contracts, which can run into hundreds of millions or billions of dollars. For customer support and communications services, this amount suggests a significant scope of work, potentially supporting a large user base or critical systems. Benchmarking against specific, comparable contracts is challenging without detailed service descriptions, but the annual spend is within a plausible range for comprehensive support functions within a large federal agency.

What are the potential risks associated with a sole-bidder scenario in this contract?

The primary risk associated with receiving only one bid is the potential for the government to overpay. Without competitive pressure, the single bidder may not feel compelled to offer the lowest possible price. This can lead to reduced value for taxpayer money. Additionally, a sole-bidder scenario might indicate issues with the solicitation process, such as overly restrictive requirements that deterred other capable vendors, or a lack of market awareness. It could also suggest a monopolistic situation for certain specialized services, although that seems less likely for general customer support. This situation necessitates careful review of the pricing and justification to ensure fairness.

What is the historical spending pattern for customer support communications within the Department of the Army?

Historical spending data for 'customer support communications' within the Department of the Army is not directly available from the provided contract details. This specific contract represents a significant investment, but to understand broader patterns, one would need to analyze aggregated spending across multiple contracts and fiscal years within the Army for similar services. Trends might show increasing reliance on outsourced support, shifts in technology used for communication, or changes in the scope of services required over time. Analyzing past solicitations and awards under relevant NAICS codes (like 541990) and Product Service Codes would be necessary to identify historical spending trends.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W9124D07R0070

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1701 KALORAMA RD NW #211, WASHINGTON, DC, 20009

Business Categories: Category Business, HUBZone Firm, Service Disabled Veteran Owned Business, Small Business, Special Designations, Veteran Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $22,371,390

Exercised Options: $22,371,390

Current Obligation: $22,366,790

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline