DoD's $12.57M IT contract for computing infrastructure awarded to Caelum Research Corporation

Contract Overview

Contract Amount: $12,570,445 ($12.6M)

Contractor: Caelum Research Corporation

Awarding Agency: Department of Defense

Start Date: 2023-01-01

End Date: 2023-12-31

Contract Duration: 364 days

Daily Burn Rate: $34.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: IT CONTRACT TO

Place of Performance

Location: ABERDEEN PROVING GROUND, HARFORD County, MARYLAND, 21005

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $12.6 million to CAELUM RESEARCH CORPORATION for work described as: IT CONTRACT TO Key points: 1. Contract value represents a significant investment in essential IT services for the Department of the Army. 2. The contract was awarded under full and open competition, suggesting a competitive bidding process. 3. The 'Delivery Order' award type indicates this is a specific task order under a larger contract vehicle. 4. The 'Time and Materials' pricing structure may present cost control challenges if not closely managed. 5. The North American Industry Classification System (NAICS) code 518210 points to a focus on data processing and hosting services. 6. The contract duration of 364 days aligns with typical annual IT service agreements. 7. The contract is managed by the Department of Defense, specifically the Department of the Army. 8. The contract is geographically located in Maryland.

Value Assessment

Rating: fair

Benchmarking the value of this $12.57 million contract requires comparison to similar IT service contracts within the Department of Defense. The 'Time and Materials' pricing model, while flexible, can sometimes lead to higher costs compared to fixed-price contracts if not meticulously monitored for labor hours and material usage. Without specific performance metrics or detailed cost breakdowns, a definitive value-for-money assessment is challenging. However, the award under full and open competition suggests an attempt to secure competitive pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which implies that while the competition was intended to be broad, there might have been specific reasons for excluding certain sources initially. The exact number of bidders is not provided, but the 'full and open' designation generally suggests multiple interested parties participated. This level of competition is typically favorable for price discovery and achieving market-based rates.

Taxpayer Impact: A full and open competition aims to ensure that taxpayers receive the best possible value by allowing all qualified vendors to bid, driving down prices through market forces.

Public Impact

The Department of the Army benefits from the provision of critical computing infrastructure and data processing services. This contract supports the operational readiness and technological capabilities of military personnel. The services delivered are essential for modern defense operations, including data management and hosting. The geographic impact is primarily within Maryland, where the contract is managed and likely services are rendered. Workforce implications may include the need for specialized IT personnel to manage and maintain the computing infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'Time and Materials' pricing structure necessitates rigorous oversight to prevent cost overruns.
The exclusion of sources in the competition, even if later resolved, warrants scrutiny of the procurement process.
Lack of specific performance metrics makes it difficult to assess the efficiency and effectiveness of the services provided.
The contract's reliance on a single awardee for a significant IT function could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, indicating a broad market solicitation.
The contract addresses a fundamental IT need for the Department of the Army.
The contractor, Caelum Research Corporation, is established in the federal IT services space.
The contract duration suggests a stable, year-long service provision.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computing infrastructure, data processing, and web hosting. The market for these services is highly competitive, with numerous providers ranging from large corporations to specialized firms. Federal spending in this area is substantial, driven by the continuous need for robust and secure IT systems to support government operations. Comparable spending benchmarks would involve analyzing other large-scale IT infrastructure contracts awarded by agencies like the DoD, GSA, and other cabinet-level departments.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. However, the prime contractor, Caelum Research Corporation, may still engage small businesses as subcontractors, depending on their own subcontracting plans and the nature of the services required. Analysis of their subcontracting reports would be necessary to determine the extent of small business participation.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Army contracting officers and program managers. Accountability measures are typically embedded within the contract's terms and conditions, including performance standards and reporting requirements. Transparency is facilitated through contract databases like FPDS-NG, which provide public access to award details. The Inspector General's office for the Department of Defense may conduct audits or investigations if performance issues or potential fraud are identified.

Related Government Programs

Department of Defense IT Services
Army Computing Infrastructure Contracts
Data Processing and Hosting Services
Time and Materials IT Contracts
Full and Open Competition IT Awards

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Need for robust oversight to manage contractor performance and costs.
Limited transparency on specific performance metrics and SLAs.
Initial exclusion of sources in competition warrants review.
Reliance on a single contractor for critical IT infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.6 million to CAELUM RESEARCH CORPORATION. IT CONTRACT TO

Who is the contractor on this award?

The obligated recipient is CAELUM RESEARCH CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $12.6 million.

What is the period of performance?

Start: 2023-01-01. End: 2023-12-31.

What is Caelum Research Corporation's track record with the Department of Defense and similar IT contracts?

Caelum Research Corporation has a history of performing IT services for the federal government, including the Department of Defense. Analyzing their past performance on similar contracts, particularly those involving computing infrastructure, data processing, and web hosting, is crucial. This includes reviewing past contract values, durations, performance evaluations (if publicly available), and any history of contract modifications or disputes. A strong track record with positive past performance reviews would indicate a lower risk for this current contract. Conversely, a history of issues could signal potential performance challenges or cost overruns. Further investigation into their specific experience with 'Time and Materials' contracts would also be beneficial to gauge their ability to manage such pricing structures effectively within the DoD environment.

How does the $12.57 million value compare to similar IT infrastructure contracts awarded by the DoD in the past year?

To benchmark the $12.57 million value, we would compare it against other Delivery Orders or contracts for computing infrastructure, data processing, and web hosting services awarded by the Department of Defense or its branches (like the Department of the Army) within the last 12-24 months. The average value of such contracts, the number of bidders involved, and the pricing structures (e.g., Time & Materials vs. Fixed Price) are key comparison points. If this contract's value is significantly higher or lower than the average for comparable services and scope, it warrants further investigation into the reasons. Factors like specialized requirements, duration, or unique service level agreements could justify deviations. Without access to a comprehensive database of comparable contracts and their specific details, a precise comparison is difficult, but the general market trend for large-scale IT infrastructure services suggests this is a substantial, but not unprecedented, investment.

What are the primary risks associated with the 'Time and Materials' (T&M) pricing structure for this contract?

The primary risk associated with the 'Time and Materials' (T&M) pricing structure for this $12.57 million IT contract is the potential for cost overruns and a lack of definitive cost certainty. Unlike fixed-price contracts, T&M contracts pay the contractor for the actual labor hours expended and the cost of materials used. This can lead to unpredictable final costs if the project scope expands, if labor hours are not efficiently managed, or if material costs escalate. For the government, effective oversight and diligent monitoring of timesheets, labor categories, and material invoices are critical to ensure fair pricing and prevent contractor inefficiencies from driving up costs. Without robust controls and clear task definitions, T&M contracts can become more expensive than initially anticipated, impacting the overall value for taxpayers.

How does the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' clause impact the competitive landscape and potential pricing?

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' clause suggests a nuanced approach to competition. Initially, certain sources may have been excluded, potentially limiting the pool of bidders. However, the subsequent 'full and open' aspect implies that the competition was ultimately broadened to include all responsible sources. This could indicate that the initial exclusions were either temporary, specific to certain aspects of the procurement, or that the agency decided to open it further after initial considerations. The impact on pricing depends on how many bidders ultimately participated after the 'full and open' phase. If a robust number of qualified bidders competed, it likely drove competitive pricing. However, if the initial exclusions significantly narrowed the field, even with an 'open' phase, the competition might have been less intense than a truly unrestricted full and open competition from the outset, potentially affecting price discovery.

What are the implications of this contract being classified under NAICS code 518210 (Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services)?

The classification under NAICS code 518210 signifies that this contract is specifically for services related to providing computing infrastructure, processing data, and hosting web services. This includes activities like operating data processing facilities, providing access to computing power, and managing web hosting environments. For the Department of the Army, this means the contract is intended to secure essential backend IT services that support a wide range of digital operations, from data storage and retrieval to application hosting and network services. The market for these services is characterized by specialized providers, cloud computing options, and a constant drive for efficiency and security. Understanding this NAICS code helps contextualize the contract's purpose within the broader IT services industry and allows for more accurate comparisons with similar government procurements.

Are there any specific performance metrics or Service Level Agreements (SLAs) associated with this contract that can be publicly assessed?

The provided data does not include specific performance metrics or Service Level Agreements (SLAs) associated with this contract. Typically, these details are outlined in the contract's statement of work (SOW) or performance work statement (PWS). Without access to these documents, it is impossible to assess the specific standards Caelum Research Corporation must meet regarding uptime, response times, data security, or other critical performance indicators. The effectiveness and value of the services are directly tied to adherence to these metrics. The 'Time and Materials' nature of the contract further emphasizes the need for clear SLAs to ensure that the contractor is incentivized to provide efficient service, not just billable hours. Publicly available contract award data often lacks these granular performance details.

Industry Classification

NAICS: Information › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W91CRB21R0017

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 30 W GUDE DR STE 200, ROCKVILLE, MD, 20850

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $17,374,724

Exercised Options: $17,374,724

Current Obligation: $12,570,445

Actual Outlays: $1,661,210

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $30,489,932

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W91CRB22D0002

IDV Type: IDC

Timeline