DoD's $25.8M Mark Center Operations Contract Awarded to Digital Management LLC for 3 Years
Contract Overview
Contract Amount: $25,794,009 ($25.8M)
Contractor: Digital Management LLC
Awarding Agency: Department of Defense
Start Date: 2013-08-16
End Date: 2016-08-15
Contract Duration: 1,095 days
Daily Burn Rate: $23.6K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 3
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: MARK CENTER OPERATION AND MAINTENANCE
Place of Performance
Location: ALEXANDRIA, ALEXANDRIA CITY County, VIRGINIA, 22301
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $25.8 million to DIGITAL MANAGEMENT LLC for work described as: MARK CENTER OPERATION AND MAINTENANCE Key points: 1. Contract value represents a significant investment in IT infrastructure management. 2. Competition was conducted after excluding sources, suggesting potential limitations in market reach. 3. The contract's duration of three years allows for sustained service delivery. 4. Performance risk appears moderate given the nature of IT operations and maintenance. 5. This contract falls within the IT services sector, specifically focusing on facilities management. 6. The award to a single contractor indicates a specific need or capability alignment.
Value Assessment
Rating: fair
The contract's total value of approximately $25.8 million over three years averages to about $8.6 million annually. Benchmarking this against similar IT operations and maintenance contracts is challenging without more specific service details. However, the Cost Plus Fixed Fee (CPFF) pricing structure can sometimes lead to higher costs if not carefully managed, as it incentivizes spending to cover costs plus a fixed profit. Further analysis would require comparing the specific services rendered and the fixed fee percentage against industry standards for similar government IT support contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that while competition was sought, certain sources were excluded from the outset. The number of bidders is not specified, but the exclusion suggests a potentially narrower field than a truly open competition. This approach might be used when specific technical capabilities or prior performance are critical, but it can limit price discovery and potentially lead to higher costs compared to a broader competitive process.
Taxpayer Impact: The exclusion of sources may mean taxpayers did not benefit from the widest possible range of competitive bids, potentially resulting in a higher overall cost for the services provided.
Public Impact
The Department of Defense benefits from the continuity of IT operations and maintenance. Essential IT services are maintained, ensuring the functionality of critical military systems. The contract supports IT infrastructure within Virginia, impacting the local federal IT ecosystem. Workforce implications include employment for IT professionals involved in operations and maintenance.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition may have reduced price negotiation leverage.
- CPFF contract type can pose cost control challenges if not rigorously overseen.
- Exclusion of sources might indicate a lack of broad market engagement.
Positive Signals
- Contract awarded to a single entity ensures focused accountability.
- The three-year duration provides stability for critical IT services.
- The contract addresses essential IT operations and maintenance needs for the DoD.
Sector Analysis
This contract falls within the Information Technology (IT) sector, specifically focusing on IT facilities management and operations. The market for IT services, particularly those supporting government agencies, is substantial and highly competitive. Contracts like this are crucial for maintaining the operational readiness of federal IT infrastructure. Comparable spending benchmarks would typically involve analyzing other large-scale IT O&M contracts awarded by defense agencies, considering factors like service scope, duration, and pricing models.
Small Business Impact
The data indicates 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. The prime contractor, Digital Management LLC, is likely a large business, and any subcontracting opportunities would be at their discretion or driven by broader federal subcontracting goals not specified here.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Army and the Department of Defense. Accountability measures are inherent in the CPFF contract type, requiring detailed cost reporting and justification. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract's execution.
Related Government Programs
- IT Operations and Maintenance Services
- Department of Defense IT Support Contracts
- Computer Facilities Management Services
- Federal IT Infrastructure Management
Risk Flags
- Limited competition due to source exclusion.
- Potential for cost overruns with CPFF contract type.
- Need for robust oversight to ensure value for money.
Tags
it-services, department-of-defense, department-of-the-army, operations-and-maintenance, it-facilities-management, cost-plus-fixed-fee, limited-competition, virginia, digital-management-llc, it-infrastructure
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $25.8 million to DIGITAL MANAGEMENT LLC. MARK CENTER OPERATION AND MAINTENANCE
Who is the contractor on this award?
The obligated recipient is DIGITAL MANAGEMENT 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 $25.8 million.
What is the period of performance?
Start: 2013-08-16. End: 2016-08-15.
What is the track record of Digital Management LLC in performing similar IT operations and maintenance contracts for the federal government?
Digital Management LLC (DMI) has a history of performing IT services for various federal agencies. While specific details on past IT operations and maintenance contracts require deeper database analysis, DMI's portfolio often includes IT support, cybersecurity, and cloud services. Their performance on previous contracts, including any past performance evaluations or awards, would be crucial in assessing their capability to successfully execute this specific DoD Mark Center Operations and Maintenance contract. A review of their contract history would reveal the scale, complexity, and success rates of their prior engagements, providing context for their suitability and the potential risks associated with this award.
How does the average annual cost of this contract compare to similar IT facilities management contracts within the Department of Defense?
The average annual cost of this contract is approximately $8.6 million ($25.8M / 3 years). To benchmark this effectively, one would need to compare it against other Department of Defense (DoD) contracts for IT facilities management and operations and maintenance (O&M) services of similar scope and duration. Factors such as the number of facilities managed, the criticality of the systems supported, the geographic spread, and the specific services included (e.g., hardware maintenance, network support, data center operations) are vital for a fair comparison. Without access to detailed service level agreements and pricing structures of comparable contracts, a precise value-for-money assessment is difficult. However, if similar contracts for comparable services are significantly lower, it could indicate potential overpricing or less efficient service delivery under this award.
What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for IT operations and maintenance?
The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for IT operations and maintenance revolve around cost control and contractor incentive. In a CPFF structure, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. The risk for the government is that the contractor may have less incentive to control costs rigorously, as their profit is fixed regardless of the total cost incurred. This can lead to cost overruns if not managed with stringent oversight and clear performance metrics. For IT O&M, where unforeseen technical issues or upgrades can arise, the potential for cost escalation is present. Effective risk mitigation requires robust government oversight, detailed cost tracking, and well-defined performance standards to ensure value for money.
What does the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' procurement method imply for the effectiveness of competition and potential cost savings?
The procurement method 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' implies a nuanced approach to competition. While it aims for broad participation, the explicit exclusion of certain sources suggests that only a subset of potential offerors was considered eligible. This exclusion might be based on specific technical requirements, past performance, or other criteria deemed necessary by the agency. The effectiveness of competition is therefore limited compared to a truly open solicitation where all responsible sources could bid. This limitation can impact price discovery, potentially leading to higher prices than might be achieved in a wider competitive environment. The rationale for exclusion needs to be well-justified to ensure that the government is still obtaining the best possible value and that taxpayer funds are used efficiently.
How has federal spending on IT operations and maintenance services evolved over the past five years, and where does this contract fit within that trend?
Federal spending on IT operations and maintenance (O&M) services has generally remained a significant portion of overall IT budgets, often comprising a substantial percentage dedicated to sustaining existing infrastructure and systems. While specific figures fluctuate annually based on agency priorities and technological shifts, there's a consistent demand for services ensuring the reliability and security of government IT. This $25.8 million contract for DoD IT O&M fits within this ongoing trend of substantial federal investment in maintaining critical IT capabilities. It reflects the government's commitment to ensuring the operational readiness of its digital infrastructure, particularly within defense agencies where system uptime and security are paramount. Trends may show shifts towards cloud-based O&M or increased focus on cybersecurity within O&M, but core infrastructure support remains a constant expenditure.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Facilities Management 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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: HQ003410R0046
Offers Received: 3
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 6701 DEMOCRACY BLVD STE 500, BETHESDA, MD, 20817
Business Categories: 8(a) Program Participant, Category Business, DoT Certified Disadvantaged Business Enterprise, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $38,982,143
Exercised Options: $25,794,009
Current Obligation: $25,794,009
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HQ003411D0003
IDV Type: IDC
Timeline
Start Date: 2013-08-16
Current End Date: 2016-08-15
Potential End Date: 2016-08-15 00:00:00
Last Modified: 2019-03-20
More Contracts from Digital Management LLC
- "vanguard 2.1" IT Help Desk and Desktop Support Services — $257.4M (Department of State)
- Aples Base Task Order - Base Period. POP: 1/1/13-12/31/13 Itar: AAP: Spend Plan: SEE Spend Plan Numbers Individual Items Listed Below. Igf::cl,Ct::igf — $115.4M (Department of Homeland Security)
- Aples Idiq Task Order 0001 — $100.3M (Department of Homeland Security)
- Interactive Personnel Electronic Records Management System Support Services Igf::ot::igf — $69.4M (Department of Defense)
- Cost Plus Fixed FEE Labor — $52.8M (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)