DOJ's $26.2M IT support contract awarded to Eagle Harbor, LLC, raises questions about competition and value

Contract Overview

Contract Amount: $26,214,656 ($26.2M)

Contractor: Eagle Harbor, LLC

Awarding Agency: Department of Justice

Start Date: 2019-09-30

End Date: 2021-03-29

Contract Duration: 546 days

Daily Burn Rate: $48.0K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: TECHNICAL AND OPERATION SUPPORT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20226

State: District of Columbia Government Spending

Plain-Language Summary

Department of Justice obligated $26.2 million to EAGLE HARBOR, LLC for work described as: TECHNICAL AND OPERATION SUPPORT SERVICES Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. The contract duration of 546 days (approx. 1.5 years) is standard for IT support services. 3. The primary service category is Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services. 4. No small business set-aside was utilized, indicating a potential missed opportunity for smaller firms. 5. The contract was awarded as a Firm Fixed Price, which shifts risk to the contractor. 6. The base contract value is substantial, requiring careful oversight to ensure value for money.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without more detailed cost breakdowns or comparable sole-source awards. The total award of $26.2M over approximately 1.5 years suggests a significant investment in IT support. Given the sole-source nature, it's difficult to assess if competitive pricing was achieved. Further analysis would require comparing the specific services rendered against industry standards and the pricing of similar sole-source IT support contracts within the federal government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the Simplified Acquisition Procedures (SAP) and was awarded on a sole-source basis. This means that only one contractor, Eagle Harbor, LLC, was solicited and awarded the contract. Without a competitive bidding process, it is difficult to ascertain the full range of potential offerors or the most cost-effective solution available in the market. The lack of competition limits the government's ability to negotiate the best possible price and terms.

Taxpayer Impact: The sole-source award means taxpayers did not benefit from the price reductions and innovation that typically arise from a competitive bidding environment. This could result in a higher overall cost for the services provided.

Public Impact

The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) is the primary beneficiary, receiving essential IT support services. Services include computing infrastructure, data processing, and web hosting, crucial for the agency's operations. The contract's impact is concentrated within the District of Columbia, where the ATF is headquartered. The contract supports IT professionals and technical staff, contributing to the federal IT workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Sole-source awards can reduce transparency and accountability.
Performance metrics and quality assurance need rigorous monitoring due to limited market pressure.

Positive Signals

Firm Fixed Price contract shifts performance risk to the contractor.
The contract is for essential IT infrastructure and data processing services, critical for agency function.
The contractor, Eagle Harbor, LLC, was awarded a definitive contract, suggesting a formal vetting process.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computing infrastructure, data processing, and web hosting. This is a critical and growing area for federal agencies, supporting everything from daily operations to complex data analysis. The market for these services is highly competitive, with numerous providers ranging from large corporations to specialized small businesses. Federal spending in this category is substantial, with agencies increasingly relying on external vendors for specialized IT expertise and infrastructure management to modernize their systems and enhance cybersecurity.

Small Business Impact

The contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. This indicates that the primary award went to Eagle Harbor, LLC, without a specific mandate to engage smaller firms. While this may streamline the primary contracting process, it represents a missed opportunity to foster small business participation in federal IT contracts, potentially limiting their access to significant contract vehicles and the associated revenue streams.

Oversight & Accountability

Oversight for this contract would primarily fall under the Bureau of Alcohol, Tobacco, Firearms and Explosives Acquisition and Property Management Division within the Department of Justice. As a sole-source award, enhanced scrutiny from oversight bodies, such as the Government Accountability Office (GAO) or the DOJ's Office of the Inspector General, may be warranted to ensure fair pricing and adequate performance. Transparency is limited due to the lack of a competitive process, making it crucial for the agency to maintain detailed records of performance and expenditures.

Related Government Programs

Department of Justice IT Services
Bureau of Alcohol, Tobacco, Firearms and Explosives IT Support
Federal Computing Infrastructure Contracts
Data Processing and Hosting Services
Sole-Source IT Contracts

Risk Flags

Sole-source award lacks competitive pricing.
Limited transparency due to non-competitive nature.
Potential for higher costs without market pressure.
Requires strong internal oversight to ensure value.

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $26.2 million to EAGLE HARBOR, LLC. TECHNICAL AND OPERATION SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is EAGLE HARBOR, LLC.

Which agency awarded this contract?

Awarding agency: Department of Justice (Bureau of Alcohol, Tobacco, Firearms and Explosives Acquisition and Property Management Division).

What is the total obligated amount?

The obligated amount is $26.2 million.

What is the period of performance?

Start: 2019-09-30. End: 2021-03-29.

What is the track record of Eagle Harbor, LLC in performing similar IT support services for federal agencies?

Information regarding Eagle Harbor, LLC's specific track record for similar IT support services within the federal government is not detailed in the provided data. As this was a sole-source award, a thorough review of past performance, client satisfaction, and adherence to contract terms would be crucial for the awarding agency. Agencies typically conduct pre-award reviews of a sole-source contractor's capabilities and past performance to justify the non-competitive award. Without access to these internal assessments or public performance data, it's difficult to definitively assess their suitability and reliability for this significant contract. Further investigation into contract databases and agency performance reports would be necessary to provide a comprehensive answer.

How does the per-unit cost of services under this contract compare to industry benchmarks for IT support?

The provided data does not include specific per-unit cost breakdowns for the services rendered under this contract, making a direct comparison to industry benchmarks impossible. The total award of $26.2 million over approximately 1.5 years for computing infrastructure, data processing, and web hosting services offers a high-level expenditure figure. To assess value for money, a detailed analysis of the service level agreements (SLAs), the specific technologies deployed, and the labor categories involved would be required. Comparing these elements against market rates for similar services, especially considering the sole-source nature which may preclude competitive pricing, is essential for a thorough value assessment. Without such granular data, any benchmark comparison remains speculative.

What are the primary risks associated with awarding a sole-source IT support contract of this magnitude?

The primary risks associated with a sole-source IT support contract of this magnitude include a lack of price competition, which can lead to inflated costs for taxpayers. Without multiple bidders vying for the contract, the government may not achieve the most favorable pricing or terms. Additionally, sole-source awards can reduce transparency and accountability, as there is less market pressure to ensure optimal performance and efficiency. There's also a risk of vendor lock-in, where the agency becomes overly reliant on a single provider, potentially hindering future flexibility and innovation. Rigorous oversight, performance monitoring, and justification for the sole-source nature are critical to mitigate these risks.

What is the historical spending pattern for IT support services by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF)?

The provided data focuses on a single contract award and does not offer historical spending patterns for IT support services by the ATF. To understand historical spending, one would need to analyze contract data over multiple fiscal years, identifying trends in contract types (competitive vs. sole-source), service categories, award values, and incumbent contractors. Such an analysis would reveal whether this $26.2 million contract represents an increase or decrease in spending, whether the ATF typically uses sole-source awards for IT support, and how its spending compares to other agencies of similar size and mission. Without this broader context, it's difficult to assess if this contract aligns with past procurement strategies or represents a significant shift.

What specific IT infrastructure and data processing services are included in this $26.2M contract?

The data indicates that the contract covers 'Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services.' This broad categorization suggests services such as server hosting, network management, data storage and retrieval, cloud computing resources, and potentially associated technical support and maintenance. The specific details of the infrastructure deployed, the volume of data processed, and the scope of web hosting services would be outlined in the contract's statement of work (SOW). Understanding these specifics is crucial for evaluating the contract's value and ensuring it meets the ATF's operational requirements effectively. The $26.2 million value over approximately 1.5 years implies a comprehensive suite of services supporting critical agency functions.

Industry Classification

NAICS: Information › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2702 DENALI ST STE 100, ANCHORAGE, AK, 99503

Business Categories: 8(a) Program Participant, 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: $58,589,656

Exercised Options: $26,214,656

Current Obligation: $26,214,656

Contract Characteristics

Commercial Item: SUPPLIES OR SERVICES PURSUANT TO FAR 12.102(F)

Cost or Pricing Data: NO

Timeline