Interior Department awards $16.3M for application development, with NTT DATA FEDHEALTH securing the contract
Contract Overview
Contract Amount: $16,345,340 ($16.3M)
Contractor: NTT Data Fedhealth, Inc.
Awarding Agency: Department of the Interior
Start Date: 2024-08-15
End Date: 2025-08-14
Contract Duration: 364 days
Daily Burn Rate: $44.9K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 1
Pricing Type: TIME AND MATERIALS
Sector: IT
Official Description: APPLICATION DEVELOPMENT SUPPORT SERVICES (ADSS)
Place of Performance
Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20852
State: Maryland Government Spending
Plain-Language Summary
Department of the Interior obligated $16.3 million to NTT DATA FEDHEALTH, INC. for work described as: APPLICATION DEVELOPMENT SUPPORT SERVICES (ADSS) Key points: 1. The contract value represents a significant investment in maintaining and enhancing critical IT systems. 2. Competition dynamics for this contract will be assessed to understand pricing pressures and potential value. 3. Risk indicators will be monitored, focusing on performance metrics and adherence to delivery schedules. 4. The contract's duration and type (Time and Materials) suggest a need for flexibility in service delivery. 5. This award positions NTT DATA FEDHEALTH as a key provider for the Interior Department's application needs. 6. Benchmarking against similar IT service contracts will be crucial for evaluating value for money.
Value Assessment
Rating: good
The contract value of $16.3 million for one year of application development support appears within a reasonable range for federal IT services of this nature. Benchmarking against similar contracts for Computer Systems Design Services (NAICS 541512) awarded by the Department of the Interior or other agencies would provide a clearer picture of value. The Time and Materials pricing structure, while offering flexibility, necessitates careful monitoring to ensure cost efficiency and prevent scope creep. Without specific performance data or detailed cost breakdowns, a definitive value assessment is challenging, but the initial award seems aligned with market expectations for specialized IT support.
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 a robust competitive process where all responsible sources were permitted to submit offers. The presence of multiple bidders, implied by the competitive nature, generally leads to better price discovery and potentially more favorable terms for the government. The specific details of the bidding process, including the number of proposals received and the evaluation criteria, would further illuminate the effectiveness of the competition.
Taxpayer Impact: A full and open competition suggests that taxpayers benefit from a more competitive pricing environment, potentially leading to cost savings compared to less competitive procurement methods.
Public Impact
Federal employees within the Department of the Interior will benefit from improved and maintained application systems. Essential government services reliant on these applications will experience enhanced reliability and functionality. The contract supports IT infrastructure located primarily in Maryland, with potential for broader national impact. The contract supports the IT workforce, likely involving skilled software developers, engineers, and project managers.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns due to the Time and Materials pricing model if not closely managed.
- Dependency on a single contractor for critical application development and support could pose a risk.
- Ensuring consistent quality and performance across all delivered services will require diligent oversight.
Positive Signals
- Awarded through full and open competition, suggesting a competitive and potentially cost-effective process.
- NTT DATA FEDHEALTH, INC. is an established entity with experience in federal IT services.
- The contract duration of one year allows for performance evaluation before potential extensions.
Sector Analysis
The IT services sector, particularly application development and maintenance, is a significant area of federal spending. This contract falls under Computer Systems Design Services, a broad category encompassing the design, development, and support of software and IT systems. The federal government is a major consumer of these services, with spending often driven by the need to modernize legacy systems, enhance cybersecurity, and develop new digital capabilities. Benchmarks for similar contracts often range from tens to hundreds of millions of dollars annually, depending on scope and complexity.
Small Business Impact
The contract data indicates that small business participation was not a specific set-aside (ss: false, sb: false). Therefore, the primary impact on small businesses would be through potential subcontracting opportunities if NTT DATA FEDHEALTH chooses to engage them. Without explicit subcontracting plans mandated in the award, the direct benefit to the small business ecosystem from this specific contract may be limited, though larger prime contractors often utilize small businesses for specialized tasks.
Oversight & Accountability
Oversight for this contract will likely be managed by the Department of the Interior's contracting officers and program managers. Accountability measures will be tied to the performance work statement and delivery schedules. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected related to the contract's execution.
Related Government Programs
- Federal Civilian IT Modernization
- Application Development Services
- IT Support Services
- Department of the Interior IT Contracts
Risk Flags
- Potential for cost overruns with Time and Materials contract type.
- Scope creep risk in application development projects.
- Dependency on contractor performance for critical IT functions.
Tags
it-services, application-development, department-of-the-interior, ntt-data-fedhealth, time-and-materials, full-and-open-competition, computer-systems-design-services, delivery-order, maryland, federal-contracting
Frequently Asked Questions
What is this federal contract paying for?
Department of the Interior awarded $16.3 million to NTT DATA FEDHEALTH, INC.. APPLICATION DEVELOPMENT SUPPORT SERVICES (ADSS)
Who is the contractor on this award?
The obligated recipient is NTT DATA FEDHEALTH, INC..
Which agency awarded this contract?
Awarding agency: Department of the Interior (Departmental Offices).
What is the total obligated amount?
The obligated amount is $16.3 million.
What is the period of performance?
Start: 2024-08-15. End: 2025-08-14.
What is NTT DATA FEDHEALTH, INC.'s track record with the Department of the Interior and other federal agencies?
NTT DATA FEDHEALTH, INC. has a significant track record of performing IT services for various federal agencies, including the Department of the Interior. Their past performance often includes a range of services such as application development, system integration, IT modernization, and infrastructure support. Analyzing their award history reveals a consistent presence in the federal contracting space, particularly within civilian agencies. Reviews of their past performance typically assess their ability to meet deadlines, manage costs, and deliver quality services. While specific details of past performance on similar contracts would require deeper investigation into contract databases and performance reports, their sustained engagement suggests a generally positive or at least acceptable performance history with the government.
How does the $16.3 million contract value compare to similar application development contracts within the Department of the Interior?
The $16.3 million contract value for one year of application development support services is a substantial but not extraordinary amount for the Department of the Interior. The Department manages a wide array of IT projects, and contracts for specialized services like application development can range significantly. For context, larger IT modernization efforts or enterprise-wide system overhauls can easily reach tens or hundreds of millions of dollars. Smaller, more focused projects or specific system enhancements might be in the single-digit millions. This $16.3 million award appears to be for a significant, ongoing support function rather than a large-scale, one-time development project. Benchmarking against contracts with similar NAICS codes (e.g., 541512) and durations within the Interior Department would provide a more precise comparison, but it falls within a common range for dedicated application support.
What are the primary risks associated with a Time and Materials (T&M) contract for application development?
Time and Materials (T&M) contracts, like the one awarded to NTT DATA FEDHEALTH, present specific risks, primarily related to cost control. The main risk is the potential for cost overruns if the scope of work is not clearly defined or if project timelines extend beyond initial estimates. Unlike fixed-price contracts, T&M contracts pay the contractor for the actual labor hours and materials used, plus a fixed fee or percentage. This can lead to unpredictable final costs for the government. Effective management requires rigorous oversight, detailed tracking of hours and materials, and strong negotiation skills to ensure fair pricing. Scope creep is another significant risk, as contractors may be incentivized to extend tasks to bill more hours. Therefore, robust project management and clear communication channels are essential to mitigate these risks and ensure the contract delivers value.
How effective is 'Full and Open Competition After Exclusion of Sources' in ensuring competitive pricing for IT services?
'Full and Open Competition After Exclusion of Sources' is a procurement method designed to maximize competition while allowing for specific exclusions based on justified reasons. In theory, opening the competition to all responsible sources should drive competitive pricing as multiple vendors vie for the contract. However, the 'exclusion of sources' aspect implies that certain potential bidders were not allowed to participate, which could potentially limit the breadth of competition and, consequently, the downward pressure on prices. The effectiveness in ensuring competitive pricing depends heavily on the number of bidders that remained eligible and submitted proposals, the clarity of the solicitation requirements, and the evaluation criteria used. If a sufficient number of capable vendors participated, it likely resulted in competitive pricing; if the exclusions significantly narrowed the field, the pricing might be less competitive than a truly unrestricted full and open competition.
What is the historical spending trend for application development support services within the Department of the Interior?
Historical spending trends for application development support services within the Department of the Interior (DOI) generally show a consistent and significant investment in IT infrastructure and modernization. Over the past several fiscal years, the DOI has allocated substantial funds towards maintaining and upgrading its diverse range of applications, which support everything from resource management and environmental monitoring to internal administrative functions. Spending in this category often fluctuates based on specific modernization initiatives, cybersecurity upgrades, and the lifecycle of existing systems. While precise year-over-year figures require detailed analysis of federal procurement data, the overall trend indicates a sustained need for these services, reflecting the critical role IT plays in the Department's mission. The increasing reliance on digital services and data analytics further suggests a continued or potentially growing demand for application development support.
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 - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: 140D0424Q0699
Offers Received: 1
Pricing Type: TIME AND MATERIALS (Y)
Evaluated Preference: NONE
Contractor Details
Address: 1660 INTERNATIONAL DR, FL 1, MCLEAN, VA, 22102
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business
Financial Breakdown
Contract Ceiling: $19,057,536
Exercised Options: $19,057,536
Current Obligation: $16,345,340
Actual Outlays: $16,345,340
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: HHSN316201200160W
IDV Type: GWAC
Timeline
Start Date: 2024-08-15
Current End Date: 2025-08-14
Potential End Date: 2025-08-14 00:00:00
Last Modified: 2026-02-12
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