Agriculture awards $16.3M contract for software development and modernization to Sohum Systems LLC

Contract Overview

Contract Amount: $16,351,834 ($16.4M)

Contractor: Sohum Systems LLC

Awarding Agency: Department of Agriculture

Start Date: 2025-05-12

End Date: 2030-05-11

Contract Duration: 1,825 days

Daily Burn Rate: $9.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 7

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SOFTWARE DELIVERY, DEVELOPMENT AND MODERNIZATION SUPPORT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20001

State: District of Columbia Government Spending

Plain-Language Summary

Department of Agriculture obligated $16.4 million to SOHUM SYSTEMS LLC for work described as: SOFTWARE DELIVERY, DEVELOPMENT AND MODERNIZATION SUPPORT SERVICES Key points: 1. Contract focuses on critical software delivery, development, and modernization, indicating a need for updated IT infrastructure. 2. The contract was awarded under full and open competition after exclusion of sources, suggesting a robust bidding process. 3. With a duration of 1825 days (5 years), this represents a significant long-term investment in IT support. 4. The firm-fixed-price contract type helps manage cost certainty for the government. 5. Sohum Systems LLC is the sole awardee for this specific delivery order. 6. The contract is managed by the Office of the Chief Financial Officer, highlighting its financial system relevance.

Value Assessment

Rating: good

The contract value of $16.3 million over five years averages to approximately $3.26 million annually. Benchmarking this against similar IT modernization and software development contracts requires detailed analysis of scope and deliverables. However, the firm-fixed-price structure suggests a degree of cost control. Without specific comparable contract data, a precise value-for-money assessment is challenging, but the competitive award process provides a positive signal.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while the initial solicitation might have had some exclusions, the final award was made through a broad competitive process. Seven bids were received, suggesting a healthy level of interest and competition for this requirement. This level of competition is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: The robust competition with seven bidders is beneficial for taxpayers, as it likely drove down prices and encouraged innovative solutions from multiple vendors, leading to a more cost-effective outcome.

Public Impact

The primary beneficiaries are the Department of Agriculture's financial operations, which will receive modernized software and development support. Services delivered include software delivery, development, and modernization, crucial for maintaining and improving IT systems. The contract is geographically focused on Washington D.C., where the Department of Agriculture is headquartered. This contract will likely support a team of software developers, project managers, and IT specialists, impacting the IT workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if follow-on work is not competitively procured.
Reliance on a single vendor for critical software modernization could pose risks if performance falters.

Positive Signals

Awarded through full and open competition, indicating a fair and broad selection process.
Firm-fixed-price contract type provides cost predictability.
Long-term duration suggests a stable partnership for critical IT needs.
Multiple bids received (7) demonstrate market interest and potential for competitive pricing.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computer systems design and related services (NAICS 541512). The market for IT modernization and software development services for federal agencies is substantial, driven by the need to update legacy systems and enhance digital capabilities. Comparable spending benchmarks would involve looking at other large-scale IT support contracts awarded to system integrators and software development firms within the federal government, particularly those focused on financial systems or agency-wide modernization efforts.

Small Business Impact

This contract does not appear to have a small business set-aside (ss: false, sb: false). As a result, small businesses are unlikely to be direct prime contractors. However, the prime contractor, Sohum Systems LLC, may engage small businesses as subcontractors to fulfill specific aspects of the contract, depending on their subcontracting plan and the nature of the work required. The impact on the small business ecosystem will largely depend on whether Sohum Systems actively seeks out and utilizes small business partners.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Agriculture's Office of the Chief Financial Officer, given their role in the award. Accountability measures are typically embedded within the contract's performance work statement (PWS), with defined deliverables, milestones, and quality standards. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any issues of fraud, waste, or abuse arise during the contract's performance.

Related Government Programs

Department of Agriculture IT Modernization Programs
Federal Civilian IT Services Contracts
Software Development and Maintenance Services
Computer Systems Design Services

Risk Flags

Potential for vendor lock-in
Reliance on single vendor for critical modernization

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $16.4 million to SOHUM SYSTEMS LLC. SOFTWARE DELIVERY, DEVELOPMENT AND MODERNIZATION SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is SOHUM 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 $16.4 million.

What is the period of performance?

Start: 2025-05-12. End: 2030-05-11.

What is Sohum Systems LLC's track record with the Department of Agriculture and similar federal agencies?

Sohum Systems LLC has a history of performing IT services for federal agencies. While specific details on their performance with the Department of Agriculture for this exact type of software modernization are not immediately available from the provided data, their award on this significant contract suggests they meet the agency's requirements. A deeper dive into their contract history, past performance evaluations, and any prior work on financial systems or modernization projects would provide a more comprehensive understanding of their capabilities and reliability. Examining their performance on previous contracts, including any challenges or successes, is crucial for assessing their suitability for this long-term engagement.

How does the $16.3 million contract value compare to similar IT modernization contracts awarded by the Department of Agriculture or other agencies?

The $16.3 million contract value over five years, averaging approximately $3.26 million annually, places this contract in the mid-to-large tier for IT modernization efforts within federal civilian agencies. To benchmark effectively, one would compare it against contracts for similar services (software development, system modernization, IT support) awarded by agencies of comparable size and complexity, such as other large cabinet-level departments. Factors like the scope of work, specific technologies involved, and the number of users supported are critical for a fair comparison. Without access to a detailed database of comparable contract values and scopes, it's difficult to definitively state if this represents exceptional value, but the competitive award process is a positive indicator.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks include potential performance issues from the contractor, scope creep, and the possibility of vendor lock-in if follow-on work isn't managed competitively. Mitigation strategies likely involve a well-defined Performance Work Statement (PWS), clear deliverables, regular performance reviews, and robust government oversight. The firm-fixed-price contract type helps mitigate cost overrun risks. Vendor lock-in can be addressed by ensuring future requirements are subject to competitive procurement processes. The agency's experience in managing IT contracts and the contractor's demonstrated capabilities also play a role in risk mitigation.

How effective is the 'Full and Open Competition After Exclusion of Sources' method in ensuring optimal value and innovation?

This procurement method aims to balance broad competition with specific agency needs that might initially exclude certain types of vendors or solutions. By allowing full and open competition after initial exclusions, it broadens the pool of potential bidders compared to a strictly limited competition, thereby fostering better price discovery and potentially uncovering innovative solutions. The fact that seven bids were received suggests it was effective in attracting a competitive field. The ultimate effectiveness in ensuring optimal value and innovation depends on the clarity of the solicitation requirements and the evaluation criteria used to select the best offer.

What is the historical spending trend for software development and IT modernization services within the Department of Agriculture?

Historical spending data for software development and IT modernization within the Department of Agriculture would reveal trends in investment in these areas. Analyzing past contract awards for similar services over several fiscal years would indicate whether spending has been increasing, decreasing, or remaining stable. This context is vital for understanding the significance of the $16.3 million award. For instance, if the USDA has consistently invested tens of millions annually in IT modernization, this contract would represent a typical portion of that investment. Conversely, if spending has been lower, this award might signify a ramp-up in modernization efforts.

Industry Classification

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

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - IT MANAGEMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 12314425R0008

Offers Received: 7

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 9232 W 143RD TER, OVERLAND PARK, KS, 66221

Business Categories: 8(a) Program Participant, Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $134,826,602

Exercised Options: $16,351,834

Current Obligation: $16,351,834

Actual Outlays: $10,072,792

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 75N98120D00062

IDV Type: GWAC

Timeline