DOJ's $21.17B Spectrum Contract Awarded to Charter Communications Raises Value and Competition Concerns

Contract Overview

Contract Amount: $21,175 ($21.2K)

Contractor: Charter Communications Operating LLC

Awarding Agency: Department of Justice

Start Date: 2024-10-01

End Date: 2026-09-30

Contract Duration: 729 days

Daily Burn Rate: $29/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: FY25-29 A34 GCRFTF SPECTRUM

Place of Performance

Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63131

State: Missouri Government Spending

Plain-Language Summary

Department of Justice obligated $21,174.61 to CHARTER COMMUNICATIONS OPERATING LLC for work described as: FY25-29 A34 GCRFTF SPECTRUM Key points: 1. The contract's significant value warrants scrutiny for cost-effectiveness and potential for competitive bidding. 2. Limited competition for this large award may impact price discovery and taxpayer value. 3. The fixed-price nature of the contract could shift risk to the government if costs escalate. 4. Performance context is limited due to the early stage of the contract. 5. This contract falls within the 'Other Computer Related Services' sector, a broad category. 6. The award to a single entity suggests potential market concentration or specific capability requirements.

Value Assessment

Rating: questionable

Benchmarking the value of this $21.17 billion contract is challenging without detailed service breakdowns and comparable market data. The sheer scale suggests a need for robust justification of cost-effectiveness. Given the 'NOT COMPETED' status, it's difficult to assess if the pricing reflects competitive market rates or if alternative, more cost-effective solutions were explored. The fixed-price nature, while offering budget certainty, could lead to overpayment if actual costs are significantly lower than anticipated.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically justified when only one vendor possesses the necessary capabilities, or in urgent situations. However, the lack of competition limits the government's ability to leverage market forces to secure the best possible pricing and terms. It raises questions about whether a more competitive process could have yielded better value for the taxpayer.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from the cost savings typically achieved through competitive bidding. This could result in a higher overall expenditure for the services provided.

Public Impact

The U.S. Marshals Service is the primary beneficiary, likely receiving critical IT and communication services. The contract supports the operational needs of a major federal law enforcement agency. The geographic impact is likely nationwide, given the scope of the U.S. Marshals Service. Workforce implications could include reliance on Charter Communications' employees for service delivery.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition for a contract of this magnitude is a significant concern.
The substantial dollar amount raises questions about value for money without a competitive process.
The 'Other Computer Related Services' NAICS code is very broad, making it hard to assess specificity of need.
The contract duration and value could indicate a strategic partnership rather than a transactional purchase.

Positive Signals

Awarding to a known entity like Charter Communications may indicate a reliance on established infrastructure and service.
The fixed-price contract provides budget certainty for the U.S. Marshals Service.
The contract is for a defined period, allowing for future re-evaluation of needs and procurement strategies.

Sector Analysis

This contract falls under the 'Other Computer Related Services' (NAICS 541519) sector, which is a broad category encompassing a wide range of IT services. The federal IT services market is substantial, with agencies consistently investing in telecommunications, network infrastructure, and related support. Awards of this size, even if sole-source, indicate significant reliance on private sector providers for critical operational capabilities. Comparable spending benchmarks are difficult without knowing the specific services, but large telecommunications and IT service contracts are common across federal agencies.

Small Business Impact

The data indicates this contract was not competed and does not specify any small business set-aside or subcontracting requirements. As a sole-source award to a large corporation, it is unlikely to directly benefit small businesses through set-asides. There is no information provided on subcontracting plans, which could potentially involve small businesses, but this is not guaranteed. The impact on the small business ecosystem is likely minimal unless Charter Communications actively engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would primarily fall under the U.S. Marshals Service contracting officers and program managers. Transparency is limited due to the sole-source nature and lack of publicly available detailed service information. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected. The fixed-price nature might simplify some aspects of financial oversight but requires vigilance on performance and scope creep.

Related Government Programs

Federal Telecommunications Contracts
IT Services for Law Enforcement
Department of Justice IT Spending
Large Scale IT Service Agreements

Risk Flags

Sole-source award for a large contract
Lack of competitive bidding raises value concerns
Broad NAICS code limits service specificity
Significant contract value requires strong justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $21,174.61 to CHARTER COMMUNICATIONS OPERATING LLC. FY25-29 A34 GCRFTF SPECTRUM

Who is the contractor on this award?

The obligated recipient is CHARTER COMMUNICATIONS OPERATING LLC.

Which agency awarded this contract?

Awarding agency: Department of Justice (U.S. Marshals Service).

What is the total obligated amount?

The obligated amount is $21,174.61.

What is the period of performance?

Start: 2024-10-01. End: 2026-09-30.

What specific services are being procured under this $21.17 billion Spectrum contract?

The provided data classifies this contract under NAICS code 541519, 'Other Computer Related Services,' and identifies the awardee as Charter Communications Operating LLC. However, the specific services procured are not detailed. Given the awardee and the broad classification, it likely encompasses a wide range of telecommunications, network, and potentially IT support services essential for the U.S. Marshals Service's nationwide operations. Without a detailed Statement of Work (SOW), it is impossible to ascertain the exact nature and scope of the services, making value assessment difficult.

Why was this contract awarded on a sole-source basis instead of being competed?

The data explicitly states the contract was 'NOT COMPETED,' indicating a sole-source award. Justifications for sole-source procurements typically include situations where only one responsible source can provide the required supplies or services, or when there is a compelling urgency. For a contract of this magnitude and duration (FY25-29), the agency (U.S. Marshals Service) would need to have documented a specific justification, such as unique capabilities possessed by Charter Communications, proprietary technology, or a critical, time-sensitive need that precluded a competitive process. The specific rationale is not provided in the summary data.

How does the $21.17 billion value compare to similar federal contracts for IT or telecommunications services?

A $21.17 billion contract value over five years (FY25-29) is exceptionally large, even within the federal IT and telecommunications sector. While agencies do award multi-billion dollar contracts, they are often for broad enterprise-wide solutions or major system procurements. Without knowing the specific services, direct comparisons are difficult. However, this figure suggests a foundational, mission-critical service likely encompassing nationwide network infrastructure, broadband access, or comprehensive communication solutions for a major agency like the U.S. Marshals Service. It represents a significant portion of the agency's IT budget, underscoring the need for rigorous justification and oversight.

What are the potential risks associated with a sole-source, fixed-price contract of this size?

A sole-source, fixed-price contract of this magnitude carries several risks. Firstly, the lack of competition means the government may not be achieving the best possible price, potentially leading to overpayment. Secondly, with a fixed-price structure, the contractor (Charter Communications) bears the risk of cost overruns, but if the initial price was set too high due to lack of competition, the government still overpays. There's also a risk of vendor lock-in, making it difficult and costly to switch providers in the future. Furthermore, without clear performance metrics and oversight, ensuring the delivery of optimal value and service quality can be challenging.

What is Charter Communications' track record with federal contracts, particularly with the Department of Justice or U.S. Marshals Service?

Charter Communications, a major telecommunications provider, has a history of federal contracts, primarily related to providing broadband, internet, and cable services. While specific details on their contracts with the Department of Justice or the U.S. Marshals Service are not provided in the summary data, their extensive commercial infrastructure suggests they are capable of supporting large-scale government requirements. Federal agencies often leverage established commercial providers for telecommunications needs. A deeper dive into contract databases like FPDS would reveal the extent and nature of their past federal performance, including any relevant past performance evaluations or disputes.

What are the implications of the 'Other Computer Related Services' NAICS code for understanding this contract's scope?

The NAICS code 541519, 'Other Computer Related Services,' is exceptionally broad. It encompasses a vast array of services including computer facilities management, IT support services, computer disaster recovery services, and computer systems integration design services, among others. This broad classification means the $21.17 billion contract could cover anything from basic internet connectivity and network maintenance to complex IT consulting and system integration. The lack of specificity makes it difficult to benchmark costs, assess the true value proposition, or understand the precise technological needs being met by Charter Communications for the U.S. Marshals Service.

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 - NETWORK

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 15M10224QA4700328

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 12405 POWERSCOURT DR, SAINT LOUIS, MO, 63131

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

Financial Breakdown

Contract Ceiling: $57,259

Exercised Options: $24,073

Current Obligation: $21,175

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline