State Department awards $4.6M IT services contract to Eagle Harbor Solutions, highlighting potential for sole-source awards

Contract Overview

Contract Amount: $4,645,528 ($4.6M)

Contractor: Eagle Harbor Solutions LLC

Awarding Agency: Department of State

Start Date: 2020-09-02

End Date: 2025-09-30

Contract Duration: 1,854 days

Daily Burn Rate: $2.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: LABOR HOURS

Sector: IT

Official Description: IT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20522

State: District of Columbia Government Spending

Plain-Language Summary

Department of State obligated $4.6 million to EAGLE HARBOR SOLUTIONS LLC for work described as: IT SERVICES Key points: 1. Contract awarded on a sole-source basis, raising questions about competitive pricing and value. 2. Significant duration of over 1800 days suggests a long-term need for these IT services. 3. The contract's value, while substantial, needs benchmarking against similar IT service procurements. 4. Lack of competition may limit opportunities for innovation and cost savings. 5. Performance context is limited due to the 'Not Available for Competition' designation. 6. Sector positioning within 'Other Computer Related Services' is broad, requiring further definition.

Value Assessment

Rating: questionable

The contract value of $4.6 million for IT services over approximately five years requires careful benchmarking. Without competitive bids, it is difficult to assess if this represents fair market value. Comparing this to similar sole-source IT service contracts awarded by the State Department or other agencies for comparable services would be crucial. The absence of competition inherently introduces a risk of overpayment or suboptimal service delivery.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a sole-source justification, meaning it was not competed openly. This typically occurs when only one vendor is capable of meeting the requirement, or in specific circumstances where full and open competition is not feasible. The lack of multiple bidders means there was no direct price comparison or market pressure to drive down costs, potentially leading to a higher price than if it had been competed.

Taxpayer Impact: Taxpayers may not be receiving the best possible value due to the absence of competitive bidding. This award mechanism limits the government's ability to leverage market forces to secure lower prices and potentially more innovative solutions.

Public Impact

The primary beneficiary is the Department of State, which receives essential IT services. Services delivered likely include IT support, maintenance, or development, crucial for agency operations. The geographic impact is centered in Washington D.C., the location of the State Department. Workforce implications may involve specialized IT professionals employed by Eagle Harbor Solutions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potential cost savings for taxpayers.
Lack of competition raises concerns about the government securing the best value.
The broad NAICS code (541519) for 'Other Computer Related Services' lacks specificity, making it hard to assess the exact nature of services and associated costs.
Contract duration of over 1800 days suggests a significant, long-term commitment without intermediate competitive review.

Positive Signals

Contract ensures continuity of critical IT services for the Department of State.
Eagle Harbor Solutions is awarded the contract, implying they meet the agency's specific needs.
The award is for IT services, a vital component of modern government operations.

Sector Analysis

The IT services sector is vast and highly competitive, encompassing a wide range of services from software development to network management. The NAICS code 541519, 'Other Computer Related Services,' is broad and can include consulting, integration, and support. Benchmarking this contract's value would require identifying comparable contracts for similar 'other computer related services' within the federal government, particularly those awarded by large agencies like the Department of State. The market for these services is dynamic, with significant spending across all federal agencies.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the contractor, Eagle Harbor Solutions LLC, is not explicitly identified as a small business in the provided data. The implications for small businesses are that they were not directly targeted for this specific award. There is no information provided regarding subcontracting plans, so the extent to which small businesses might be involved indirectly through subcontracting is unknown.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of State's contracting officers and program managers. Transparency is limited due to the sole-source nature of the award, making public scrutiny of the procurement process challenging. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected during the contract's performance or award. Standard contract performance reviews and reporting mechanisms would be in place.

Related Government Programs

Department of State IT Modernization Programs
Federal Civilian Agency IT Services Contracts
Sole-Source IT Procurements
Other Computer Related Services Contracts

Risk Flags

Sole-source award raises concerns about fair pricing and value.
Lack of competition may limit innovation and cost-effectiveness.
Broad NAICS code lacks specificity for detailed analysis.
Contract duration is substantial, indicating long-term reliance on the vendor.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $4.6 million to EAGLE HARBOR SOLUTIONS LLC. IT SERVICES

Who is the contractor on this award?

The obligated recipient is EAGLE HARBOR SOLUTIONS LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $4.6 million.

What is the period of performance?

Start: 2020-09-02. End: 2025-09-30.

What specific IT services are being provided under this contract, and how do they align with the Department of State's mission objectives?

The provided data classifies this contract under NAICS code 541519, 'Other Computer Related Services.' This is a broad category that can encompass a wide array of IT functions, including but not limited to IT consulting, systems integration, custom software development, IT support services, and data processing. Without further details from the contract's statement of work (SOW), it is difficult to pinpoint the exact services. However, for the Department of State, these services are likely critical for maintaining secure and efficient communication networks, managing sensitive data, supporting diplomatic operations, and enabling internal administrative functions. The long contract duration (1854 days) suggests these services are essential and ongoing, integral to the department's day-to-day operations and strategic IT infrastructure.

How does the pricing structure (labor hours) compare to industry benchmarks for similar IT services, especially given the sole-source nature?

The contract is awarded on a 'LABOR HOURS' basis, meaning payment is based on the time spent by personnel performing the work, rather than fixed deliverables. This pricing model can be advantageous for tasks where the scope is uncertain or evolves. However, without specific labor categories, rates, and the total hours worked, a direct comparison to industry benchmarks is challenging. For sole-source contracts, the absence of competition means there's no direct market validation of the rates. To assess value, one would need to compare Eagle Harbor Solutions' proposed labor rates against government-wide IT labor rate ceilings (like GSA schedules, if applicable) or against rates paid to similar contractors for comparable skill sets within the Department of State or other agencies, adjusted for experience and location. The risk is that without competitive pressure, labor rates might be higher than necessary.

What is the track record of Eagle Harbor Solutions LLC in performing federal IT service contracts, particularly sole-source awards?

Information regarding Eagle Harbor Solutions LLC's specific track record with federal IT service contracts, especially sole-source awards, is not detailed in the provided data snippet. A comprehensive assessment would require reviewing the contractor's past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), previous contract awards, and any documented issues or successes. Understanding their history with the Department of State or other agencies would provide insight into their reliability, quality of service, and ability to manage complex IT projects. Without this historical context, it's difficult to gauge their performance risk associated with this $4.6 million award.

What are the potential risks associated with awarding a sole-source IT contract of this magnitude and duration?

The primary risks associated with a sole-source IT contract of this magnitude ($4.6M) and duration (over 5 years) include: 1) **Lack of Value for Money:** Without competition, the government may pay higher prices than necessary, as there's no market pressure to optimize costs. 2) **Limited Innovation:** A single provider may have less incentive to introduce cutting-edge solutions or efficiencies compared to a competitive environment. 3) **Vendor Lock-in:** The agency becomes dependent on a single vendor, potentially making it difficult or costly to switch providers later if performance issues arise or better alternatives emerge. 4) **Reduced Transparency:** Sole-source awards are often less transparent, making it harder for oversight bodies and the public to scrutinize the procurement process and ensure fairness. 5) **Performance Risk:** While the agency selected this vendor, without competitive validation, there's an inherent risk that the vendor may not perform optimally throughout the contract's lifecycle.

How does this contract's spending compare to overall federal IT spending or similar IT service contracts within the Department of State?

The $4.6 million awarded to Eagle Harbor Solutions represents a relatively small fraction of the total federal IT spending, which runs into the tens of billions of dollars annually. Within the Department of State, this contract contributes to their overall IT budget. To provide a meaningful comparison, one would need to analyze the Department of State's historical IT spending patterns, specifically for 'Other Computer Related Services' (NAICS 541519) or similar IT support categories. Benchmarking against average contract values, number of bidders, and pricing for comparable IT services procured by the State Department or other agencies of similar size and mission would be necessary. The sole-source nature of this award means its value cannot be directly compared to competitively bid contracts without significant caveats regarding price discovery.

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 › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 3800 CENTERPOINT DR STE 502, 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: $4,663,889

Exercised Options: $4,663,889

Current Obligation: $4,645,528

Actual Outlays: $2,016,206

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 19AQMM20D0095

IDV Type: IDC

Timeline