DOJ's $16.5M contract for Pen-Link services awarded to Pen-Link, Ltd. without competition

Contract Overview

Contract Amount: $16,522,461 ($16.5M)

Contractor: Pen-Link, Ltd

Awarding Agency: Department of Justice

Start Date: 2024-07-01

End Date: 2027-06-30

Contract Duration: 1,094 days

Daily Burn Rate: $15.1K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PROCUREMENT OF PEN-LINK FOR BASE PLUS 4 OPTION YEARS POP 07/01/2024-06/30/2029 PEN-LINK, LTD QUOTE DATED JANUARY 2024 IS INCORPORATED HEREIN.

Place of Performance

Location: LINCOLN, LANCASTER County, NEBRASKA, 68516

State: Nebraska Government Spending

Plain-Language Summary

Department of Justice obligated $16.5 million to PEN-LINK, LTD for work described as: PROCUREMENT OF PEN-LINK FOR BASE PLUS 4 OPTION YEARS POP 07/01/2024-06/30/2029 PEN-LINK, LTD QUOTE DATED JANUARY 2024 IS INCORPORATED HEREIN. Key points: 1. The contract value of $16.5 million over its potential duration suggests a significant investment in specialized data services. 2. Awarded without competition, this contract raises questions about potential price discovery and market fairness. 3. The fixed-price contract type aims to control costs, but the lack of competition may limit negotiation leverage. 4. The duration of the contract, spanning over five years, indicates a long-term need for the procured services. 5. The specific service category, 'Other Computer Related Services,' is broad and requires further detail to assess its precise function. 6. The absence of small business set-aside or subcontracting plans warrants scrutiny regarding broader economic impact.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without more detailed service descriptions and comparable contract data. The sole-source nature limits direct price comparisons to similar procurements. However, the fixed-price structure provides some cost certainty for the government. Further analysis would require understanding the specific functionalities and market rates for 'Pen-Link' services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the Simplified Acquisition Procedures (SAP), indicating it was likely awarded directly to Pen-Link, Ltd. without soliciting bids from other vendors. The absence of a competitive process means that the government did not explore alternative solutions or pricing from the broader market, potentially missing opportunities for better value or innovation.

Taxpayer Impact: The lack of competition means taxpayers may not be receiving the most cost-effective solution available. Without bids from other companies, it's difficult to ascertain if the negotiated price reflects true market value.

Public Impact

The primary beneficiary is likely the Drug Enforcement Administration (DEA) within the Department of Justice, which will utilize the Pen-Link services. The services delivered are expected to support law enforcement and intelligence gathering activities, though specific applications are not detailed. The geographic impact is likely national, supporting federal law enforcement operations across the United States. There are no immediate indications of significant workforce implications or direct public-facing services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated prices and reduced innovation.
Limited transparency in the procurement process hinders public trust and accountability.
The broad service category 'Other Computer Related Services' lacks specificity, making performance monitoring difficult.

Positive Signals

Fixed-price contract type offers cost predictability.
Long contract duration suggests a stable, ongoing need for the service.
Awarded to a specific vendor, potentially indicating specialized expertise.

Sector Analysis

The IT services sector, particularly specialized data analysis and intelligence software, is a significant area of federal spending. This contract falls under 'Other Computer Related Services,' a broad category that can encompass a wide range of IT support and solutions. Comparable spending benchmarks are difficult to establish without knowing the specific nature of 'Pen-Link' services, but federal IT spending overall is in the hundreds of billions annually.

Small Business Impact

The contract data indicates that this procurement was not set aside for small businesses, nor does it appear to involve significant subcontracting opportunities for small businesses. This suggests that the primary contractor, Pen-Link, Ltd., will be performing the majority of the work. The impact on the small business ecosystem is likely minimal unless Pen-Link, Ltd. has its own robust small business subcontracting program, which is not specified here.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Justice's internal procurement and contract management divisions, as well as potentially the DEA's program managers. The Inspector General for the Department of Justice may have jurisdiction for audits and investigations if concerns arise. Transparency is limited due to the sole-source nature and lack of public detail on the specific services.

Related Government Programs

Federal Bureau of Investigation (FBI) IT Services
Intelligence Community IT Support
Department of Homeland Security Data Analytics
Drug Enforcement Administration (DEA) Software Procurement

Risk Flags

Lack of Competition
Potential for Overpricing
Limited Transparency
Vendor Lock-in Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $16.5 million to PEN-LINK, LTD. PROCUREMENT OF PEN-LINK FOR BASE PLUS 4 OPTION YEARS POP 07/01/2024-06/30/2029 PEN-LINK, LTD QUOTE DATED JANUARY 2024 IS INCORPORATED HEREIN.

Who is the contractor on this award?

The obligated recipient is PEN-LINK, LTD.

Which agency awarded this contract?

Awarding agency: Department of Justice (Drug Enforcement Administration).

What is the total obligated amount?

The obligated amount is $16.5 million.

What is the period of performance?

Start: 2024-07-01. End: 2027-06-30.

What specific capabilities does 'Pen-Link' provide, and how do they support the DEA's mission?

The provided data does not specify the exact capabilities of 'Pen-Link.' However, based on the vendor name and the context of law enforcement procurement, it likely refers to a software or service that aids in the analysis of communication data, financial transactions, or other intelligence relevant to drug trafficking investigations. This could involve data aggregation, pattern identification, link analysis, and reporting tools. The DEA's mission involves enforcing federal drug laws, which often requires sophisticated data analysis to track illicit activities, identify key players, and disrupt criminal organizations. Without more specific information, the precise contribution of Pen-Link remains inferred.

What is the historical spending pattern for similar 'Pen-Link' services by the DEA or other agencies?

The provided data does not include historical spending information for this specific contract or similar services. To assess historical patterns, one would need to query federal procurement databases (like FPDS or USASpending) for contracts awarded to Pen-Link, Ltd. or for services categorized similarly to 'Other Computer Related Services' with a focus on intelligence analysis tools. Understanding past spending would help determine if this $16.5 million award represents an increase, decrease, or consistent level of investment in such capabilities. It would also reveal if this is a new requirement or a continuation of existing services.

What is the market landscape for 'Pen-Link' type services, and what are typical pricing structures?

The market for specialized data analysis and intelligence software, often referred to by proprietary names like 'Pen-Link,' is typically dominated by a few key vendors. These services often involve complex software licenses, ongoing maintenance, and support, leading to significant contract values. Pricing structures can vary, including perpetual licenses, subscription-based models, or usage-based fees. Without knowing the specific functionalities of Pen-Link, it's difficult to provide precise market comparisons or typical pricing. However, given the sole-source award, the government may have limited leverage to negotiate based on competitive market rates.

Are there any known performance issues or contractor past performance concerns with Pen-Link, Ltd. on previous contracts?

The provided data does not contain information regarding the past performance of Pen-Link, Ltd. A thorough assessment would require reviewing contract performance reports (CPARS) and any available public records or news related to the company's previous government contracts. Concerns about past performance could include missed deadlines, quality issues, or cost overruns. Conversely, positive past performance could justify a sole-source award if the contractor has demonstrated unique capabilities and reliability. Without this information, the risk associated with the contractor's track record remains unknown.

What are the risks associated with a sole-source award for critical data analysis services?

Sole-source awards for critical services like data analysis carry several risks. Firstly, the government may pay a premium due to the lack of competition, potentially exceeding fair market value. Secondly, it limits the opportunity for innovation that might come from alternative solutions offered by other vendors. Thirdly, it creates vendor lock-in, making it difficult and costly to switch providers in the future, even if performance degrades or better alternatives emerge. Finally, it can raise concerns about transparency and fairness in the procurement process, potentially leading to scrutiny.

Industry Classification

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

Product/Service Code: IT AND TELECOM - APLLICATIONS

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: 5936 VANDERVOORT DR, LINCOLN, NE, 68516

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $29,130,568

Exercised Options: $29,130,568

Current Obligation: $16,522,461

Actual Outlays: $10,664,587

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline