DoD's $34.7M Software Services Contract with Unisys: Limited Competition Raises Concerns
Contract Overview
Contract Amount: $34,746,609 ($34.7M)
Contractor: Unisys Corporation
Awarding Agency: Department of Defense
Start Date: 2008-12-01
End Date: 2009-11-30
Contract Duration: 364 days
Daily Burn Rate: $95.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: CLIN 0001AE PRODUCTION SOFTWARE SERVICES
Place of Performance
Location: CHAMBERSBURG, FRANKLIN County, PENNSYLVANIA, 17201
Plain-Language Summary
Department of Defense obligated $34.7 million to UNISYS CORPORATION for work described as: CLIN 0001AE PRODUCTION SOFTWARE SERVICES Key points: 1. Significant spending on computer systems design services. 2. Sole provider Unisys Corporation holds the contract. 3. Potential for inflated costs due to lack of competition. 4. IT sector spending, specifically within Defense Information Systems Agency.
Value Assessment
Rating: questionable
The contract's value of $34.7M for 364 days of service is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar IT service contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This significantly limits price discovery and may lead to higher costs for taxpayers as there was no market pressure to offer the best price.
Taxpayer Impact: The lack of competition likely results in a higher cost to taxpayers than if the contract had been competitively bid.
Public Impact
Taxpayers may be overpaying for essential software services. Lack of competitive pressure could stifle innovation in service delivery. Dependence on a single vendor for critical IT functions.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
Positive Signals
- Contract awarded to a known entity (Unisys Corporation)
- Firm Fixed Price contract type can offer some cost certainty
Sector Analysis
This contract falls within the IT sector, specifically Computer Systems Design Services, a common area for government spending. Benchmarks for similar services are hard to establish without competitive data.
Small Business Impact
The contract data indicates that small business participation was not a factor in this award (ss: false, sb: false).
Oversight & Accountability
The contract was awarded under 'Other Transaction' (aw: DO), which can sometimes bypass standard procurement regulations, potentially impacting oversight and accountability.
Related Government Programs
- Computer Systems Design Services
- Department of Defense Contracting
- Defense Information Systems Agency Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for inflated costs.
- Lack of transparency in pricing justification.
- Dependence on a single vendor.
- Award mechanism (DO) may reduce standard oversight.
Tags
computer-systems-design-services, department-of-defense, pa, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $34.7 million to UNISYS CORPORATION. CLIN 0001AE PRODUCTION SOFTWARE SERVICES
Who is the contractor on this award?
The obligated recipient is UNISYS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Information Systems Agency).
What is the total obligated amount?
The obligated amount is $34.7 million.
What is the period of performance?
Start: 2008-12-01. End: 2009-11-30.
What was the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award is critical for understanding the value proposition. Without a competitive process, the government must have had specific reasons, such as unique capabilities or urgent needs, to bypass competition. This information is essential for determining if the price paid was justified and if taxpayer funds were used efficiently.
What are the risks associated with a sole-source IT services contract of this magnitude?
The primary risks include potential cost overruns due to the absence of competitive pricing pressure, vendor lock-in limiting future flexibility, and a lack of incentive for the vendor to innovate or improve service quality. Over time, this can lead to suboptimal performance and higher long-term costs for the agency.
How does this contract's pricing compare to industry benchmarks for similar services?
Direct comparison is challenging without competitive data. However, the lack of competition suggests a risk of the price being higher than market rates. A thorough review of the pricing structure against industry standards for comparable IT services, considering the specific deliverables and service levels, would be necessary to assess value.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: HC101304R5018
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 11720 PLAZA AMERICA DR, RESTON, VA, 11
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $34,746,609
Exercised Options: $34,746,609
Current Obligation: $34,746,609
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HC101305D2001
IDV Type: IDC
Timeline
Start Date: 2008-12-01
Current End Date: 2009-11-30
Potential End Date: 2009-11-30 00:00:00
Last Modified: 2010-09-21
More Contracts from Unisys Corporation
- Delivery Order — $261.6M (Department of Homeland Security)
- Automated Targeting Systems Maintenance — $261.0M (Department of Homeland Security)
- This Order IS Executed to Fulfill the Integrated Traveler Initiative (ITI). the ITI Requirement IS to Provide Systems Engineering and Technical Services to Fully Implement the Land, AIR, SEA Poes and Checkpoints. Tasks Include Planning, Management, Design, Fabrication, Procuring Hardware and Software, Integration, Providing Installation Material and Services, Testing, Training and Maintenance — $198.0M (Department of Homeland Security)
- Whti Land Border Integration (LBI) Task Order Award — $190.2M (Department of Homeland Security)
- IT Bridge — $185.4M (Department of Homeland Security)
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)