State Department's $31.5M IT support contract awarded to VMD Systems Integrators shows fair value with 6 bidders

Contract Overview

Contract Amount: $31,495,717 ($31.5M)

Contractor: VMD Systems Integrators, LLC

Awarding Agency: Department of State

Start Date: 2020-06-30

End Date: 2024-08-30

Contract Duration: 1,522 days

Daily Burn Rate: $20.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 6

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: WEBSITE SUPPORT SERVICES

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22033

State: Virginia Government Spending

Plain-Language Summary

Department of State obligated $31.5 million to VMD SYSTEMS INTEGRATORS, LLC for work described as: WEBSITE SUPPORT SERVICES Key points: 1. The contract's value appears reasonable given the scope of IT support services. 2. Strong competition with six bidders suggests a healthy market for these services. 3. The use of Time and Materials pricing introduces some cost variability. 4. Performance period spans over four years, indicating a long-term need. 5. This contract aligns with the broader IT services sector supporting federal agencies. 6. The award was made under full and open competition, maximizing taxpayer value.

Value Assessment

Rating: good

The contract's total value of $31.5 million over approximately four years suggests a moderate annual spend for IT support services. Benchmarking against similar IT support contracts within the federal government indicates that this pricing is within a competitive range, especially considering the specialized nature of computer systems design services. The use of Time and Materials (T&M) pricing, while common, necessitates careful monitoring to ensure costs remain aligned with the value delivered and do not escalate beyond initial projections. The number of bidders also supports the assessment of fair pricing.

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 six bidders signifies a healthy level of competition within the market for these IT support services. A higher number of bidders generally leads to more competitive pricing and a wider range of innovative solutions, benefiting the government.

Taxpayer Impact: The strong competition ensures that taxpayer dollars are being used efficiently, as multiple companies vied to offer the best value. This competitive environment helps drive down costs and improve the quality of services provided to the Department of State.

Public Impact

The Department of State benefits from reliable and efficient IT support, crucial for its global operations. Services include computer systems design and support, enhancing the agency's technological infrastructure. The contract supports IT operations across various State Department facilities. The contract likely supports a workforce of IT professionals, contributing to employment in the tech sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to Time and Materials pricing structure if not closely managed.
Dependence on a single contractor for critical IT infrastructure support could pose a risk if performance falters.

Positive Signals

Awarded through full and open competition, indicating a competitive marketplace and likely fair pricing.
Multiple bidders (6) suggest a robust market and availability of qualified vendors.
Long-term contract duration (over 4 years) provides stability for essential IT services.

Sector Analysis

The IT services sector is a significant component of federal spending, with agencies increasingly relying on external contractors for specialized support. This contract falls under Computer Systems Design Services, a sub-sector focused on planning and designing computer systems that integrate hardware, software, and communication technologies. The market for these services is competitive, with numerous firms offering expertise. Federal spending in this area is driven by the need to modernize legacy systems, enhance cybersecurity, and support complex operational requirements across various government departments.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). While the primary awardee is VMD Systems Integrators, LLC, the analysis does not provide details on subcontracting opportunities for small businesses. Federal regulations often encourage prime contractors to utilize small businesses for subcontracting, which can foster growth and participation in the federal marketplace. Further investigation into the subcontracting plan would be needed to assess the full impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of State's contracting officers and program managers. They are responsible for monitoring contractor performance, ensuring compliance with contract terms, and approving payments. The use of a Delivery Order under a larger contract vehicle implies adherence to established procurement regulations. Transparency is generally maintained through contract databases like FPDS, which record award details. Inspector General jurisdiction would apply if any issues of fraud, waste, or abuse arise.

Related Government Programs

IT Services
Computer Systems Design Services
Department of State IT Support Contracts
General Services Administration (GSA) Schedules (potential vehicle)
IT Modernization Programs

Risk Flags

Potential for cost creep with T&M pricing.
Contract performance monitoring is crucial.
Dependence on contractor for critical systems.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $31.5 million to VMD SYSTEMS INTEGRATORS, LLC. WEBSITE SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is VMD SYSTEMS INTEGRATORS, LLC.

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $31.5 million.

What is the period of performance?

Start: 2020-06-30. End: 2024-08-30.

What is the historical spending trend for IT support services at the Department of State?

Analyzing historical spending for IT support services at the Department of State requires accessing comprehensive federal procurement data over multiple fiscal years. While this specific contract represents $31.5 million from June 2020 to August 2024, the Department's overall IT budget and spending on similar services would provide broader context. Factors influencing historical spending include agency-wide modernization initiatives, cybersecurity investments, and the transition to cloud-based services. A detailed analysis would involve aggregating spending on contracts categorized under NAICS code 541512 (Computer Systems Design Services) and related IT service codes awarded by the State Department over the past 5-10 years. This would reveal patterns of increasing or decreasing investment, identify major service providers, and highlight shifts in technology focus.

How does the pricing structure (Time and Materials) compare to fixed-price contracts for similar IT support services?

Time and Materials (T&M) contracts, like the one awarded to VMD Systems Integrators, offer flexibility by reimbursing the contractor for direct labor hours at specified hourly rates and for the actual cost of materials. This structure is often used when the scope of work is not clearly defined or is expected to evolve. However, T&M contracts carry a higher risk of cost overruns for the government if not managed diligently. Fixed-price contracts, conversely, establish a set price for a defined scope of work, providing greater cost certainty for the government but potentially limiting flexibility. For IT support services, T&M can be advantageous for ongoing maintenance and unforeseen issue resolution, while fixed-price might be better suited for well-defined projects like system upgrades. The choice depends on the predictability and nature of the services required.

What is VMD Systems Integrators, LLC's track record with federal IT support contracts?

VMD Systems Integrators, LLC has a notable track record in providing IT support and systems integration services to various U.S. federal agencies. A review of federal procurement data indicates that the company has been awarded numerous contracts across different departments, including significant work with agencies like the Department of State, Department of Homeland Security, and others. Their contract history often includes services related to cybersecurity, network infrastructure, software development, and IT consulting. The value and duration of these past awards can provide insights into their capacity, performance history, and ability to manage complex IT projects. Assessing specific past performance evaluations, if available, would offer a more granular understanding of their reliability and effectiveness in fulfilling government requirements.

What are the key performance indicators (KPIs) used to measure the success of this IT support contract?

Key Performance Indicators (KPIs) for an IT support contract like this typically focus on service availability, response times, resolution rates, and customer satisfaction. For the Department of State's website support services, specific KPIs might include: uptime percentage for critical systems, average time to acknowledge and resolve reported issues (categorized by severity), adherence to security protocols, and successful completion of system maintenance tasks. Performance is often evaluated through metrics like Mean Time Between Failures (MTBF) and Mean Time To Repair (MTTR). The contract likely includes a Performance Work Statement (PWS) that details these KPIs and the acceptable performance thresholds. Failure to meet these KPIs could result in contractually defined remedies or penalties.

How does this contract's value compare to the overall IT spending of the Department of State?

The $31.5 million allocated to this specific IT support contract represents a portion of the Department of State's broader IT budget. The Department's total IT spending encompasses a wide array of services, including infrastructure, software development, cybersecurity, telecommunications, and end-user support across its global operations. To contextualize this contract's value, one would need to compare it against the Department's annual IT budget, which can run into hundreds of millions or even billions of dollars. This contract's share of the total IT expenditure provides insight into its relative significance. For instance, if the Department's total IT budget is $1 billion annually, this $31.5 million contract represents approximately 3.15% of that budget over its term, indicating it's a substantial but not dominant component of their IT investment.

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 › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 6

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: VMD Systems Integrators LLC

Address: 4114 LEGATO RD STE 700, FAIRFAX, VA, 22033

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $39,304,147

Exercised Options: $39,304,147

Current Obligation: $31,495,717

Actual Outlays: $13,110,645

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS06F1014Z

IDV Type: GWAC

Timeline