Koniag IT Systems awarded $20.3M for FY23 CEC/GSD Support Services, a sole-source contract

Contract Overview

Contract Amount: $20,278,766 ($20.3M)

Contractor: Koniag IT Systems, LLC

Awarding Agency: Department of Agriculture

Start Date: 2023-05-15

End Date: 2025-05-14

Contract Duration: 730 days

Daily Burn Rate: $27.8K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: DESCRIPTION: FY23 CEC/GSD SUPPORT SERVICES GOVERNANCE SUPPORT POP: 5/15/2023 - 05/14/2024 COR: JANELL DUKE REF USDA CRQ 4353831

Place of Performance

Location: ANCHORAGE, ANCHORAGE County, ALASKA, 99503

State: Alaska Government Spending

Plain-Language Summary

Department of Agriculture obligated $20.3 million to KONIAG IT SYSTEMS, LLC for work described as: DESCRIPTION: FY23 CEC/GSD SUPPORT SERVICES GOVERNANCE SUPPORT POP: 5/15/2023 - 05/14/2024 COR: JANELL DUKE REF USDA CRQ 4353831 Key points: 1. The contract value of $20.3 million for one year of support services represents a significant investment in IT governance. 2. As a sole-source award, the absence of competition may limit price negotiation advantages for the government. 3. The contract's duration of 730 days (2 years) suggests a need for sustained support in IT governance functions. 4. The 'Other Computer Related Services' NAICS code indicates a broad scope of potential IT support activities. 5. The firm-fixed-price contract type shifts cost risk to the contractor, potentially leading to higher initial bids. 6. The award to Koniag IT Systems, LLC warrants a review of their past performance in similar government contracts.

Value Assessment

Rating: questionable

The contract value of $20.3 million for a two-year period, averaging $10.15 million per year, needs benchmarking against similar IT governance support contracts. Without competitive bids, it is difficult to assess if this price represents fair market value. The firm-fixed-price structure means the government pays a set amount, but the initial pricing could be inflated due to the lack of competition. Further analysis of the specific services rendered and their necessity would be required to fully evaluate value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor possesses the necessary qualifications or when circumstances prevent a competitive process. The lack of competition means that the government did not benefit from the potential for lower prices or innovative solutions that a bidding process might have yielded. The justification for this sole-source award would need to be thoroughly reviewed to understand the specific circumstances.

Taxpayer Impact: Taxpayers may not have received the best possible price for these services due to the absence of a competitive bidding process. The government's ability to negotiate favorable terms is reduced when only one vendor is considered.

Public Impact

The Office of the Chief Financial Officer within the Department of Agriculture is the primary beneficiary, receiving essential IT governance support. The services delivered are expected to enhance the efficiency and effectiveness of the department's financial operations through robust IT governance. The contract is geographically focused on Alaska (ST: AK, SN: ALASKA), suggesting specific regional IT needs or operations being supported. The contract supports the government's IT workforce by potentially outsourcing specialized governance functions, allowing internal staff to focus on core missions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potential savings.
Lack of competition raises concerns about whether the government secured the best value.
The broad 'Other Computer Related Services' category could lead to scope creep if not tightly managed.
The contract's fixed-price nature might incentivize the contractor to minimize effort, potentially impacting service quality if not monitored.

Positive Signals

The award is to a specific entity (KONIAG IT SYSTEMS, LLC), suggesting a known provider for these services.
The firm-fixed-price contract type provides budget certainty for the government.
The contract duration indicates a recognized, ongoing need for these IT governance services.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computer-related services and IT governance. The market for IT support services to government agencies is substantial, with significant spending allocated annually. This contract represents a portion of the Department of Agriculture's overall IT expenditure. Comparable spending benchmarks would typically involve analyzing other government contracts for similar IT governance support, often categorized under professional services or IT consulting.

Small Business Impact

This contract was not awarded as a small business set-aside, and there is no indication of subcontracting requirements for small businesses. Therefore, it does not directly contribute to the government's small business contracting goals through this specific award. The impact on the small business ecosystem is neutral, as it does not create new opportunities or obligations for small businesses in this instance.

Oversight & Accountability

Oversight for this contract would typically be managed by the Contracting Officer's Representative (COR), Janell Duke, who is responsible for monitoring performance and ensuring compliance with contract terms. The Department of Agriculture's internal procurement and financial oversight mechanisms would also apply. Transparency is generally facilitated through contract databases, but the specifics of the sole-source justification and performance metrics would require direct inquiry.

Related Government Programs

IT Governance Support Services
Computer Systems Design Services
Professional, Scientific, and Technical Services
Federal IT Procurement
Department of Agriculture IT Spending

Risk Flags

Sole-source award raises concerns about competition and potential value.
Lack of detailed service scope in summary data requires further investigation.
Need to verify justification for sole-source procurement.
Potential for cost overruns if scope is not tightly managed, despite fixed-price.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $20.3 million to KONIAG IT SYSTEMS, LLC. DESCRIPTION: FY23 CEC/GSD SUPPORT SERVICES GOVERNANCE SUPPORT POP: 5/15/2023 - 05/14/2024 COR: JANELL DUKE REF USDA CRQ 4353831

Who is the contractor on this award?

The obligated recipient is KONIAG IT SYSTEMS, LLC.

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Office of the Chief Financial Officer).

What is the total obligated amount?

The obligated amount is $20.3 million.

What is the period of performance?

Start: 2023-05-15. End: 2025-05-14.

What is the specific justification for awarding this contract on a sole-source basis to KONIAG IT SYSTEMS, LLC?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are awarded when only one responsible source is available or capable of providing the required services, or under urgent circumstances. For this contract, the Department of Agriculture would have had to document why a competitive process was not feasible or advantageous. Reasons could include unique capabilities of KONIAG IT SYSTEMS, LLC, proprietary technology, or a critical need that could not be met through competition within the required timeframe. A thorough review of the contract file and associated justifications would be necessary to ascertain the precise rationale.

How does the $20.3 million contract value compare to similar IT governance support contracts awarded by the Department of Agriculture or other federal agencies?

Without access to a comprehensive database of comparable contracts and their specific service scopes, a precise comparison is challenging. However, $20.3 million for a two-year period (averaging over $10 million annually) for IT governance support is a substantial sum. Generally, IT support and consulting services for large federal agencies can range from hundreds of thousands to tens of millions of dollars annually, depending on the complexity and breadth of services. The sole-source nature of this award makes direct value comparison more difficult, as competitive bids often drive prices down. Benchmarking would ideally involve identifying contracts with similar NAICS codes (541519) and service descriptions, adjusted for contract duration and agency size.

What are the key performance indicators (KPIs) or deliverables expected under this contract, and how is performance being measured?

The provided data does not specify the key performance indicators (KPIs) or detailed deliverables for the FY23 CEC/GSD Support Services contract. However, for IT governance support, typical KPIs might include metrics related to system availability, response times for support requests, successful implementation of governance policies, audit readiness, and compliance adherence. Performance measurement would likely involve regular reporting by KONIAG IT SYSTEMS, LLC, reviews by the COR (Janell Duke), and potentially periodic government assessments or audits to ensure the services meet the contract's requirements and objectives. The firm-fixed-price nature implies that meeting these defined deliverables is paramount.

What is KONIAG IT SYSTEMS, LLC's track record with federal contracts, particularly in IT governance and support services?

KONIAG IT SYSTEMS, LLC has a history of receiving federal contracts. To assess their track record specifically for IT governance and support services, one would need to examine their past performance evaluations, contract history (including types of services, values, and agencies served), and any reported issues or successes. Databases like SAM.gov or FPDS can provide contract history. A positive track record would typically involve successful completion of similar contracts, positive past performance reviews, and adherence to contract terms and conditions. Given this is a sole-source award, the agency likely has prior positive experience or specific knowledge of KONIAG's capabilities.

What is the historical spending trend for IT governance support services within the Department of Agriculture, and how does this contract fit into that pattern?

The provided data does not offer historical spending trends for IT governance support services within the Department of Agriculture. To analyze this, one would need to review the agency's budget allocations and contract awards over several fiscal years, specifically looking for contracts under relevant NAICS codes (like 541519) and service descriptions related to IT governance. This $20.3 million contract represents a significant single award for a two-year period. Understanding historical spending would help determine if this contract represents an increase, decrease, or continuation of previous investment levels in this area and whether it aligns with broader IT modernization or support strategies within the agency.

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 › IT AND TELECOM - IT MANAGEMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3800 CENTERPOINT DRIVE, SUITE 502, ANCHORAGE, AK, 99503

Business Categories: Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $20,278,766

Exercised Options: $20,278,766

Current Obligation: $20,278,766

Actual Outlays: $20,278,766

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline