HHS awards $229M for Other Computer Related Services to OAO Corporation over 12 years
Contract Overview
Contract Amount: $22,940,648 ($22.9M)
Contractor: OAO Corporation
Awarding Agency: Department of Health and Human Services
Start Date: 2001-10-09
End Date: 2013-04-04
Contract Duration: 4,195 days
Daily Burn Rate: $5.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: IT
Place of Performance
Location: DURHAM, DURHAM County, NORTH CAROLINA, 27703
Plain-Language Summary
Department of Health and Human Services obligated $22.9 million to OAO CORPORATION for work described as: Key points: 1. Significant contract value of $229.4M over a 12-year period. 2. OAO Corporation secured this contract through full and open competition. 3. The contract duration is exceptionally long, raising potential value concerns. 4. Services fall under 'Other Computer Related Services', a broad category.
Value Assessment
Rating: fair
The contract value is substantial, but the long duration (over 12 years) makes direct pricing comparisons difficult without more granular data on specific services rendered. Benchmarking against similar long-term IT service contracts would be necessary for a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded using full and open competition, which generally promotes competitive pricing. However, the extended duration might have allowed for price escalations or less aggressive initial bidding compared to shorter-term contracts.
Taxpayer Impact: The long-term nature of this contract means taxpayers are committed to a significant expenditure over an extended period. While competition was present, the duration warrants scrutiny for ongoing value.
Public Impact
Taxpayers are committed to over $229 million for IT services over more than a decade. The extended contract length could indicate a need for stable, long-term IT support within NIH. The broad 'Other Computer Related Services' category may encompass a wide range of IT functions.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (12+ years)
- Broad service category
- No small business participation noted
Positive Signals
- Full and open competition utilized
- Significant contract value awarded
Sector Analysis
This contract falls within the IT services sector, specifically 'Other Computer Related Services'. Spending in this area is substantial across federal agencies, supporting a wide array of technological needs. Benchmarks for long-term IT service contracts vary widely based on scope and complexity.
Small Business Impact
The data indicates that small business participation was not a factor in this contract award (sb: false). This suggests the prime contractor, OAO Corporation, likely performed the majority of the work, or subcontracting opportunities for small businesses were not explicitly mandated or pursued.
Oversight & Accountability
The long duration of this contract necessitates robust oversight to ensure continued value and performance. Regular reviews of service delivery, pricing adjustments, and adherence to contract terms are crucial for accountability and taxpayer protection.
Related Government Programs
- Other Computer Related Services
- Department of Health and Human Services Contracting
- National Institutes of Health Programs
Risk Flags
- Long contract duration may reduce flexibility and increase risk of obsolescence or overpayment.
- Broad service category lacks specificity, potentially obscuring detailed cost drivers.
- No indication of small business subcontracting, missing potential economic opportunities.
- Firm Fixed Price over 12 years might not adequately account for market fluctuations or technological shifts.
- Significant taxpayer investment over an extended period requires continuous value assessment.
Tags
other-computer-related-services, department-of-health-and-human-services, nc, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $22.9 million to OAO CORPORATION. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is OAO CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Health and Human Services (National Institutes of Health).
What is the total obligated amount?
The obligated amount is $22.9 million.
What is the period of performance?
Start: 2001-10-09. End: 2013-04-04.
What specific services were included under 'Other Computer Related Services' and how did their scope evolve over the 12-year period?
The 'Other Computer Related Services' category is broad and could encompass anything from IT consulting and system integration to data processing and network management. Without a detailed statement of work, it's difficult to ascertain the exact services. The evolution of these services over a 12-year span is critical for assessing if the contract remained relevant and cost-effective as technology advanced.
How did the firm fixed price structure adapt to potential changes in technology or service requirements over the contract's 12-year duration?
A firm fixed price (FFP) contract aims to provide price certainty. However, over a 12-year period, significant technological shifts or changes in NIH's requirements could arise. The contract's modification history would reveal how such changes were managed under the FFP structure, potentially through change orders or new agreements, impacting the overall value delivered.
What was the rationale for awarding a contract of such extended duration, and were alternative shorter-term contracts considered?
The rationale for a long-duration contract often relates to the need for stable, continuous support for critical systems or the contractor's significant investment in specialized infrastructure. However, such long terms can also reduce flexibility and potentially lead to higher costs if market conditions or needs change. Exploring the justification and comparison with shorter-term options is key to understanding the decision's effectiveness.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 7500 GREENWAY CENTER DR #, GREENBELT, MD, 20770
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $39,090,056
Exercised Options: $22,972,429
Current Obligation: $22,940,648
Contract Characteristics
Commercial Item: SERVICES PURSUANT TO FAR 12.102(G)
Timeline
Start Date: 2001-10-09
Current End Date: 2013-04-04
Potential End Date: 2013-04-04 00:00:00
Last Modified: 2019-04-23
More Contracts from OAO Corporation
- 200101!000092!5700!CA03 !21 Cons/Lgc !F0560400C9004 !a!n!*!y!p00002 !20001001!20010331!149299679!149299679!074830209!n!oao Corporation !2020 N Academy Blvd !colorado Sprin !co!80909!14142!041!08!cheyenne MTN Complex!el Paso !colorado !+000001966495!n!n!000000000000!m127!operation/Electronic & Communication Facilities !S1 !services !3000!NOT Discernable or Classified !513390!*!*!3! ! !C!*!*!*!B!*!*!A! !A !N!R!2!004!B! !C!N!Z! ! !N!C!N! ! ! !c!c!a!a!000!a!c!n! ! ! !Y! ! !0001! — $92.9M (Department of Defense)
- Federal Contract — $86.1M (National Aeronautics and Space Administration)
- 4200091243 SAP Msfc Odin Desktop & Network — $47.1M (National Aeronautics and Space Administration)
- ADP Systems Development Services — $22.0M (Department of Health and Human Services)
- Federal Contract — $21.9M (National Aeronautics and Space Administration)
Other Department of Health and Human Services Contracts
- Contact Center Operations (CCO) — $5.5B (Maximus Federal Services, Inc.)
- TAS::75 0849::TAS Oper of Govt R&D Goco Facilities — $4.8B (Leidos Biomedical Research Inc)
- THE Purpose of This Contract IS to Provide the Full Complement of Services Necessary to Care for UC in ORR Custody Including Facilities Set-Up, Maintenance, and Support Internal and Perimeter (IF Applicable) Security, Direct Care and Supervision Inc — $3.5B (Rapid Deployment Inc)
- Contact Center Operations — $2.6B (Maximus Federal Services, Inc.)
- Federal Contract — $2.4B (Leidos Biomedical Research Inc)
View all Department of Health and Human Services contracts →