EOP awards $6.5M for IT services to FOUR LLC, raising questions on value and competition

Contract Overview

Contract Amount: $6,547,386 ($6.5M)

Contractor: Four LLC

Awarding Agency: Executive Office of the President

Start Date: 2023-03-14

End Date: 2027-03-29

Contract Duration: 1,476 days

Daily Burn Rate: $4.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: LICENSING AND PROFESSIONAL SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20503

State: District of Columbia Government Spending

Plain-Language Summary

Executive Office of the President obligated $6.5 million to FOUR LLC for work described as: LICENSING AND PROFESSIONAL SERVICES Key points: 1. Contract value appears moderate for IT services, but specific deliverables are key to assessing value. 2. The contract was awarded under full and open competition after exclusion of sources, suggesting a competitive process. 3. Risk indicators are not immediately apparent, but performance history and market benchmarks will provide further insight. 4. This contract supports IT services within the Executive Office of the President, a critical government function. 5. The sector is IT services, specifically 'Other Computer Related Services', a broad category. 6. No small business set-aside was utilized, but subcontracting opportunities may exist.

Value Assessment

Rating: fair

The contract value of $6.55 million over approximately four years for IT services is within a typical range for government contracts of this nature. However, without detailed knowledge of the specific services rendered, it is difficult to definitively benchmark its value. Comparing the per-unit cost of services, if applicable, against industry standards or similar government contracts would be necessary for a more robust value assessment. The firm fixed-price structure suggests that the contractor bears the risk of cost overruns, which can be a positive indicator for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES'. This indicates that the agency initially considered excluding certain sources but ultimately opened the competition to all eligible offerors. The presence of 4 bids suggests a reasonable level of competition, which typically aids in price discovery and can lead to more favorable pricing for the government. The specific reasons for excluding sources initially, if any, are not detailed here.

Taxpayer Impact: A competitive award process, even with initial exclusions, generally benefits taxpayers by fostering a more competitive environment that can drive down costs and improve service quality.

Public Impact

The Executive Office of the President (EOP) is the primary beneficiary, receiving essential IT services. Services delivered likely include IT support, maintenance, or development, crucial for EOP operations. The geographic impact is concentrated in the District of Columbia, where the EOP is headquartered. Workforce implications may involve IT professionals employed by FOUR LLC or its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed service descriptions makes value assessment challenging.
The 'after exclusion of sources' clause warrants further investigation into the initial competitive landscape.
Contract duration of nearly four years requires ongoing performance monitoring.

Positive Signals

Awarded under full and open competition, indicating broad market access.
Firm fixed-price contract shifts cost risk to the contractor.
Multiple bids (4) suggest a competitive award process.

Sector Analysis

The IT services sector is vast and highly competitive. This contract falls under 'Other Computer Related Services,' a broad NAICS code encompassing a range of IT support and consulting. Government spending in this area is substantial, with agencies constantly seeking to modernize and maintain their technological infrastructure. Benchmarking this contract's value would require comparing it to similar IT service contracts awarded by federal agencies, considering factors like service scope, duration, and contractor experience.

Small Business Impact

This contract does not appear to have a small business set-aside. The absence of specific subcontracting plans mentioned in the provided data means the direct impact on the small business ecosystem is unclear. However, if FOUR LLC utilizes subcontractors, there could be opportunities for small businesses to participate in fulfilling the contract requirements.

Oversight & Accountability

Oversight for this contract would typically fall under the contracting agency within the Executive Office of the President. Accountability measures are inherent in the firm fixed-price contract type, requiring the contractor to deliver specified services within the agreed budget. Transparency is generally facilitated through contract databases like FPDS, where basic award information is publicly available. Specific Inspector General jurisdiction would depend on the EOP's internal structure and any relevant IG offices overseeing its operations.

Related Government Programs

IT Professional Services
Computer Related Services
Executive Office of the President IT Support
Federal IT Contracts

Risk Flags

Potential for undefined scope creep in IT services.
Need for detailed performance monitoring due to FFP contract type.
Limited insight into initial source exclusion rationale.

Frequently Asked Questions

What is this federal contract paying for?

Executive Office of the President awarded $6.5 million to FOUR LLC. LICENSING AND PROFESSIONAL SERVICES

Who is the contractor on this award?

The obligated recipient is FOUR LLC.

Which agency awarded this contract?

Awarding agency: Executive Office of the President (Executive Office of the President).

What is the total obligated amount?

The obligated amount is $6.5 million.

What is the period of performance?

Start: 2023-03-14. End: 2027-03-29.

What specific IT services are being provided under this contract, and how do they align with the EOP's mission?

The provided data classifies this contract under NAICS code 541519, 'Other Computer Related Services.' This broad category can encompass a wide array of IT functions, including but not limited to IT consulting, systems integration, custom software development, and IT support services. Without a detailed Statement of Work (SOW) or contract line item details, it is impossible to ascertain the precise services. However, given the agency is the Executive Office of the President (EOP), these services are likely critical for supporting the technological infrastructure, communication systems, and data management necessary for the EOP's core functions, which include advising the President on policy and managing the White House staff. The specific alignment would depend on whether the services are for operational support, strategic planning, cybersecurity, or system modernization.

How does the awarded amount of $6.55 million compare to similar IT service contracts for executive branch agencies?

The total contract value of $6.55 million over its duration (approximately 4 years) translates to an average annual value of roughly $1.64 million. This figure is moderate for IT services within the federal government. Larger agencies or those with more complex IT infrastructures often award contracts in the tens or hundreds of millions of dollars. However, the EOP, while critical, is a smaller entity compared to departments like Defense or Homeland Security. To provide a precise comparison, one would need to analyze contracts with similar NAICS codes (541519) awarded to agencies of comparable size and scope, considering factors like contract type (firm fixed-price), duration, and specific service requirements. Publicly available databases like FPDS or USAspending can be used for such benchmarking, looking for contracts with similar dollar ranges and service descriptions.

What are the potential risks associated with a firm fixed-price contract for IT services, and how are they mitigated?

Firm fixed-price (FFP) contracts place the primary risk of cost overruns on the contractor. This is generally favorable for the government as it provides cost certainty. However, for complex IT services, risks can emerge. If the scope of work is not clearly defined, the contractor may cut corners on quality to maintain profitability, or disputes may arise over what constitutes 'complete' work. To mitigate these risks, robust contract management is essential. This includes detailed SOWs, clear performance metrics, regular progress reviews, and a strong quality assurance plan. The government must actively monitor performance and adherence to specifications. For this specific contract, the EOP would need to ensure its technical team is capable of overseeing the contractor's deliverables and managing any potential scope creep or quality issues effectively.

What does the 'after exclusion of sources' clause imply about the initial procurement process?

The phrase 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' suggests a two-stage process. Initially, the agency may have identified specific sources or types of sources it intended to exclude from consideration, perhaps due to specific requirements, past performance issues, or a desire to focus on a particular segment of the market. However, the agency then decided to proceed with a broader, full and open competition, allowing all responsible sources to submit offers. This could indicate that after initial consideration, the agency determined that a wider competition would yield better results, or that the initial reasons for exclusion were not sufficiently justified under procurement regulations for a sole-source or limited competition. It implies a deliberate decision to maximize competition despite potential initial considerations for exclusion.

What is the track record of FOUR LLC in performing federal IT contracts, particularly those of similar scope and value?

Information regarding the specific track record of FOUR LLC is not detailed in the provided data snippet. To assess their performance history, one would need to consult federal procurement databases such as the Federal Procurement Data System (FPDS) or USAspending. These platforms allow users to search for contracts awarded to a specific contractor, review their past performance ratings (if available), identify the types of services they have provided, and examine the value and duration of those contracts. A review of FOUR LLC's past federal contracts would reveal their experience with similar IT services, their performance on firm fixed-price awards, and their ability to meet government requirements, providing crucial context for evaluating this current award.

How does the geographic location (District of Columbia) influence the cost and nature of these IT services?

The contract's performance location is listed as the District of Columbia (DC). This is significant because labor costs, particularly for specialized IT professionals, are generally higher in the Washington D.C. metropolitan area compared to many other regions in the United States. This higher cost of living and demand for skilled labor can translate into higher pricing for IT services. Furthermore, proximity to the EOP headquarters might imply requirements for on-site support, rapid response times, or enhanced security protocols due to the sensitive nature of the work environment. The specific services might also be tailored to the unique technological landscape and regulatory environment within the federal government operating in the nation's capital.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2303 DULLES STATION BLVD STE 105, HERNDON, VA, 20171

Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $18,440,841

Exercised Options: $18,440,841

Current Obligation: $6,547,386

Actual Outlays: $3,729,563

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: NNG15SC73B

IDV Type: GWAC

Timeline