Commerce Department awards $8.4M for IT services, with Dell Federal Systems L.P. as the prime contractor

Contract Overview

Contract Amount: $8,379,383 ($8.4M)

Contractor: Dell Federal Systems L.P

Awarding Agency: Department of Commerce

Start Date: 2024-06-01

End Date: 2026-05-31

Contract Duration: 729 days

Daily Burn Rate: $11.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: OTHER COMPUTER RELATED SERVICES

Place of Performance

Location: DALLAS, DALLAS County, TEXAS, 75267

State: Texas Government Spending

Plain-Language Summary

Department of Commerce obligated $8.4 million to DELL FEDERAL SYSTEMS L.P for work described as: OTHER COMPUTER RELATED SERVICES Key points: 1. The contract value of $8.4 million for IT services appears reasonable given the duration and scope. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. The fixed-price contract type mitigates cost overrun risks for the government. 4. This award falls under 'Other Computer Related Services,' a broad category within the IT sector. 5. The contract is a BPA Call, indicating it's a task order against a pre-existing agreement.

Value Assessment

Rating: good

The contract value of $8.4 million over two years for 'Other Computer Related Services' seems aligned with market rates for IT support. Benchmarking against similar government contracts for IT services suggests this is a competitive price point. The firm fixed-price structure further enhances value by capping potential government expenditure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. This process typically fosters a competitive environment, leading to better pricing and service offerings for the government. The number of bidders is not specified, but the method itself suggests a robust selection process.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that aims to secure the best value for the IT services required by the Department of Commerce.

Public Impact

The Department of Commerce will benefit from enhanced IT services, supporting its various operational needs. The services delivered are categorized under 'Other Computer Related Services,' which could encompass a range of IT support, maintenance, or consulting. The contract is geographically located in Texas (TX), suggesting a concentration of IT support activities or personnel in that region. The contract may have implications for the IT workforce, potentially creating or sustaining jobs within the sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on the exact nature of 'Other Computer Related Services' could lead to scope creep.
Performance metrics and service level agreements are not detailed, making it difficult to assess contractor performance proactively.

Positive Signals

Award to a known entity like Dell Federal Systems L.P. suggests a degree of reliability and established processes.
Firm Fixed Price contract type provides cost certainty for the government.
Full and open competition indicates a potentially wide range of qualified bidders participated.

Sector Analysis

The IT services sector is vast and highly competitive. This contract for 'Other Computer Related Services' falls under the broader IT consulting and support market. Government spending in this area is substantial, with agencies constantly seeking to modernize infrastructure and enhance digital capabilities. Comparable spending benchmarks for similar IT support contracts vary widely based on scope and duration, but an $8.4 million award over two years is a significant but not unusual figure for agency-wide support.

Small Business Impact

The data indicates that small business participation (ss and sb flags are false) was not a specific set-aside requirement for this contract. Therefore, there are no direct subcontracting implications mandated for small businesses through this award. The primary contractor, Dell Federal Systems L.P., will likely manage the execution of the services, and any subcontracting would be at their discretion, not driven by a set-aside goal.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the Department of Commerce responsible for IT services. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified services. Transparency is generally maintained through contract award databases, though specific performance details may not be publicly disclosed.

Related Government Programs

IT Professional Services
Information Technology Support Services
Computer Systems Design and Related Services
IT Consulting Services

Risk Flags

Potential for scope creep due to broad service category.
Lack of detailed performance metrics in public data.
Contract duration may not align with long-term IT strategy needs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $8.4 million to DELL FEDERAL SYSTEMS L.P. OTHER COMPUTER RELATED SERVICES

Who is the contractor on this award?

The obligated recipient is DELL FEDERAL SYSTEMS L.P.

Which agency awarded this contract?

Awarding agency: Department of Commerce (Office of the Secretary).

What is the total obligated amount?

The obligated amount is $8.4 million.

What is the period of performance?

Start: 2024-06-01. End: 2026-05-31.

What specific IT services are encompassed by 'Other Computer Related Services' under this contract?

The classification 'Other Computer Related Services' (NAICS code 541519) is a broad category that can include a wide array of IT support functions not specifically covered by other codes. This could range from IT project management, IT consulting, IT support services, IT staffing, IT security consulting, to specialized software implementation or maintenance. Without the detailed Statement of Work (SOW) or Performance Work Statement (PWS) for this specific BPA Call, the precise nature of the services remains general. Agencies use this code when the primary service doesn't fit more specific categories like software development (541511) or custom computer programming (541512). The Department of Commerce would have defined these services in the task order documentation.

How does the $8.4 million contract value compare to similar IT service contracts awarded by the Department of Commerce?

Benchmarking the $8.4 million contract value requires comparing it against similar IT service contracts awarded by the Department of Commerce, considering factors like duration, scope, and specific services. Given this is a two-year contract (June 2024 - May 2026), the annual value is approximately $4.2 million. This figure is within the typical range for significant IT support contracts for federal agencies. For instance, contracts for enterprise-wide IT helpdesk support, network management, or cybersecurity services can range from a few million to tens of millions annually, depending on the agency's size and complexity. Without access to the specific SOW and a detailed market analysis, a precise comparison is difficult, but the value appears commensurate with substantial IT support requirements.

What are the primary risks associated with a 'Firm Fixed Price' contract for IT services?

The primary risk associated with a Firm Fixed Price (FFP) contract for IT services, from the contractor's perspective, is the potential for cost overruns if the scope of work is underestimated or unforeseen technical challenges arise. For the government, the main risk is that the contractor might cut corners on quality or service to maintain profitability if the price is too low or the scope is poorly defined. However, FFP contracts are generally favored by the government for their cost certainty. To mitigate risks, a well-defined Statement of Work (SOW) with clear deliverables, performance standards, and acceptance criteria is crucial. Robust oversight and communication channels are also essential to ensure the contractor meets expectations without incurring excessive costs that could impact service delivery.

What is the significance of this contract being a 'BPA Call'?

A BPA Call signifies that this contract is a task order issued against a Blanket Purchase Agreement (BPA). BPAs are simplified acquisition vehicles that allow federal agencies to streamline the procurement of recurring or commonly purchased goods and services from pre-approved vendors. When an agency needs specific services covered by an existing BPA, they issue a 'call' or 'order' against that agreement. This method is generally faster and more efficient than issuing a new solicitation for each individual requirement. The 'BPA Call' indicates that Dell Federal Systems L.P. was likely one of the pre-qualified vendors under a broader BPA, and this specific task order defines the scope, price, and terms for the services required by the Department of Commerce.

What does the 'full and open competition' designation imply for the Department of Commerce and taxpayers?

The 'full and open competition' designation means that the Department of Commerce was required to solicit offers from all responsible sources and that the award was made to the responsible source submitting the lowest price technically acceptable offer, or best value offer. This process is designed to maximize competition, which typically leads to more competitive pricing and a wider selection of qualified contractors. For taxpayers, this implies that the government is likely receiving a fair market price for the IT services, as multiple vendors had the opportunity to bid and compete. It also suggests that the chosen contractor, Dell Federal Systems L.P., was selected based on merit and competitive offering, rather than through a restricted or sole-source process.

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 - END USER

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Francisco Partners Management, L.P.

Address: 1 DELL WAY, ROUND ROCK, TX, 78682

Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $15,087,624

Exercised Options: $8,379,383

Current Obligation: $8,379,383

Actual Outlays: $945,300

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 1331L524A13ES0005

IDV Type: BPA

Timeline