DoD's $24.5M wired telecommunications contract awarded to STG LLC in Arizona

Contract Overview

Contract Amount: $24,544,103 ($24.5M)

Contractor: STG LLC

Awarding Agency: Department of Defense

Start Date: 2008-03-13

End Date: 2008-12-31

Contract Duration: 293 days

Daily Burn Rate: $83.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 14

Pricing Type: COMBINATION (TWO OR MORE)

Sector: IT

Official Description: LABOR

Place of Performance

Location: FORT HUACHUCA, COCHISE County, ARIZONA, 85613

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $24.5 million to STG LLC for work described as: LABOR Key points: 1. Contract awarded for wired telecommunications services, indicating a need for robust network infrastructure. 2. The contract was competed under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES', suggesting a potentially competitive process. 3. The duration of 293 days points to a project with a defined, relatively short-term scope. 4. Awarded to STG LLC, a review of their past performance and financial stability is crucial. 5. The contract's value of $24.5M places it in the mid-tier range for federal IT services. 6. Geographic focus on Arizona suggests specific regional telecommunications requirements. 7. The absence of small business set-aside flags indicates this was not specifically targeted for smaller enterprises.

Value Assessment

Rating: fair

Benchmarking the $24.5M value against similar wired telecommunications contracts is challenging without more specific service details. However, the duration of 293 days for this amount suggests a moderate per-day expenditure. Further analysis would require comparing the scope of services (e.g., bandwidth, installation, maintenance) to industry standards and other government contracts for similar requirements to assess true value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES', which implies that while the competition was intended to be open, certain sources may have been excluded prior to the final award. This could indicate a specific technical requirement or a pre-existing relationship that narrowed the field. With 14 bidders initially, the competition level appears moderate, but the exclusion clause warrants scrutiny to understand its impact on the final pricing and the range of potential solutions considered.

Taxpayer Impact: While a moderate number of bidders can lead to competitive pricing, the exclusion of sources might have limited the potential for the most cost-effective solutions to emerge, potentially impacting taxpayer savings.

Public Impact

The Department of Defense benefits from enhanced wired telecommunications infrastructure, crucial for operational command and control. Services delivered likely include installation, maintenance, and support for network connectivity within military facilities in Arizona. The geographic impact is concentrated in Arizona, supporting military operations and personnel in that region. Workforce implications may include direct employment by STG LLC and potential indirect employment in the telecommunications sector supporting the contract.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'EXCLUSION OF SOURCES' clause in the competition type requires further investigation to ensure it did not unduly restrict competition and lead to higher costs.
The relatively short contract duration (293 days) might indicate a need for follow-on contracts, potentially leading to fragmented service delivery or increased administrative burden.
Lack of specific details on the services provided makes it difficult to fully assess the value for money and compare it to market rates.
The contract's value is substantial, necessitating robust oversight to ensure performance and prevent cost overruns.

Positive Signals

The contract was awarded through a competitive process, indicating that multiple vendors vied for the opportunity.
The award to STG LLC suggests they met the technical and performance requirements set forth by the Department of the Army.
The contract specifies a clear end date, providing a defined period for service delivery and budget allocation.

Sector Analysis

Wired telecommunications services are a critical component of the IT sector, encompassing the infrastructure that supports data transmission. The federal government is a significant consumer of these services, with spending often driven by the need for secure, reliable, and high-bandwidth connectivity for agencies like the Department of Defense. Market size for federal telecommunications contracts is substantial, with spending fluctuating based on infrastructure upgrades, modernization efforts, and evolving technological requirements. This contract fits within the broader category of telecommunications infrastructure support, essential for maintaining operational readiness.

Small Business Impact

This contract does not appear to have a small business set-aside. The award value and nature of the services suggest it may not have been structured for small business participation. There is no explicit information regarding subcontracting plans for small businesses, which could represent a missed opportunity to engage the small business ecosystem in supporting this federal requirement.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army, a component of the Department of Defense. Accountability measures would be embedded in the contract's performance work statement (PWS), including defined deliverables, service level agreements, and payment schedules tied to performance. Transparency is facilitated through federal contract databases where award information is published. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Defense Information Systems Agency (DISA) Telecommunications Services
General Services Administration (GSA) Federal Telecommunications Services
Department of Defense IT Infrastructure Contracts
Network Modernization Programs

Risk Flags

Potential for limited competition due to source exclusion.
Need for detailed performance metrics to ensure value for money.
Risk of service interruption if follow-on funding is not secured.
Dependency on contractor's technical expertise and financial stability.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.5 million to STG LLC. LABOR

Who is the contractor on this award?

The obligated recipient is STG 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 $24.5 million.

What is the period of performance?

Start: 2008-03-13. End: 2008-12-31.

What specific wired telecommunications services were included in this $24.5M contract?

The provided data indicates the contract falls under NAICS code 517110 (Wired Telecommunications Carriers) and was awarded to STG LLC by the Department of the Army. However, the specific services are not detailed. Typically, contracts under this code can encompass a range of services including the installation, maintenance, and operation of wired telecommunications networks, such as local area networks (LANs), wide area networks (WANs), fiber optic infrastructure, and associated equipment. The value of $24.5M over 293 days suggests a significant scope, potentially involving large-scale network build-outs, upgrades, or comprehensive managed services for military installations within Arizona.

How did the 'EXCLUSION OF SOURCES' clause impact the competitive landscape and pricing?

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' designation implies that while the competition was intended to be open, certain potential bidders were excluded from the outset. The reasons for exclusion are not specified but could be due to unique technical requirements, proprietary technology, or specific security clearances. While 14 bidders participated, the exclusion could have limited the pool of qualified vendors, potentially reducing the intensity of competition and possibly leading to a higher-than-optimal price. Understanding the justification for the exclusion is key to assessing whether it was a necessary measure to meet specific agency needs or an impediment to achieving the best possible value for taxpayers.

What is the track record of STG LLC in performing similar federal contracts?

Information on STG LLC's specific track record for similar federal contracts is not provided in the summary data. A comprehensive analysis would require reviewing their past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), any past issues or disputes, and their experience with contracts of comparable size and scope within the Department of Defense or other federal agencies. Their success in this $24.5M contract would depend on their demonstrated ability to deliver reliable wired telecommunications services, meet deadlines, and manage costs effectively, as evidenced by their historical performance.

How does the $24.5M contract value compare to typical federal spending on wired telecommunications in Arizona?

Directly comparing this $24.5M contract to typical federal spending on wired telecommunications specifically within Arizona is difficult without granular, localized spending data. Federal telecommunications spending varies significantly based on agency needs, infrastructure projects, and geographic concentration of facilities. This contract represents a substantial investment for a 293-day period. To benchmark it, one would need to analyze historical spending patterns by DoD and other federal agencies in Arizona for similar services, considering factors like the number of installations supported and the scope of network requirements.

What are the potential risks associated with a contract of this nature and duration?

Potential risks include technical obsolescence if the chosen technology is not future-proof, performance issues leading to network disruptions, cost overruns if not managed tightly, and potential security vulnerabilities within the wired infrastructure. Given the 293-day duration, there's also a risk of service discontinuity if follow-on contracts are not secured in a timely manner. Furthermore, reliance on a single contractor, even if competitively selected, carries inherent risks if that contractor faces financial difficulties or operational challenges.

What oversight mechanisms are in place to ensure the effective delivery of services under this contract?

Oversight for this contract would be managed by the contracting officer and the contracting officer's representative (COR) within the Department of the Army. These individuals are responsible for monitoring contractor performance, ensuring compliance with the contract terms and conditions, and approving payments. Performance metrics outlined in the Performance Work Statement (PWS) would be used to track progress and quality. Regular progress meetings and site inspections may also be part of the oversight process. The Department of Defense also has internal audit and Inspector General functions that could provide oversight if specific concerns arise.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

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

Offers Received: 14

Pricing Type: COMBINATION (TWO OR MORE) (2)

Evaluated Preference: NONE

Contractor Details

Address: 11710 PLAZA AMERICA DR STE 1200, RESTON, VA, 11

Business Categories: Asian Pacific American Owned Business, Category Business, Federally Funded Research and Development Corp, Manufacturer of Goods, Minority Owned Business, Small Business, Special Designations, Subchapter S Corporation

Financial Breakdown

Contract Ceiling: $25,311,668

Exercised Options: $25,311,668

Current Obligation: $24,544,103

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W91RUS07D0003

IDV Type: IDC

Timeline