State Department awards $7.5M contract for professional services to OBXTEK INC

Contract Overview

Contract Amount: $7,541,650 ($7.5M)

Contractor: Obxtek Inc

Awarding Agency: Department of State

Start Date: 2025-09-30

End Date: 2026-06-30

Contract Duration: 273 days

Daily Burn Rate: $27.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: TSE STAFFING CONTRACT

Place of Performance

Location: DUNN LORING, FAIRFAX County, VIRGINIA, 22027

State: Virginia Government Spending

Plain-Language Summary

Department of State obligated $7.5 million to OBXTEK INC for work described as: TSE STAFFING CONTRACT Key points: 1. Contract awarded on a non-competitive basis, raising questions about potential cost savings. 2. The contract duration of 273 days suggests a need for ongoing support services. 3. Services fall under 'All Other Professional, Scientific, and Technical Services,' a broad category. 4. The contract type is Time and Materials, which can lead to cost overruns if not managed closely. 5. Virginia is the primary location for this contract, indicating a potential regional focus. 6. The base award amount is $2.76M, with the total potential value reaching $7.54M.

Value Assessment

Rating: questionable

The contract's value of $7.54 million for a 273-day period appears high, especially given the non-competitive award. Without a competitive bidding process, it's difficult to benchmark the pricing against market rates or similar contracts. The Time and Materials pricing structure also introduces risk for cost escalation. Further analysis is needed to determine if the services provided justify this expenditure and if alternative, more cost-effective solutions were considered.

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 limits the opportunity for price discovery and potentially higher quality solutions that might emerge from a competitive environment. The rationale for a sole-source award should be thoroughly documented to ensure it was justified and that taxpayer funds are being used efficiently.

Taxpayer Impact: Sole-source awards can result in higher costs for taxpayers as there is no competitive pressure to drive down prices. This lack of competition may also mean that the government is not receiving the best possible value for its investment.

Public Impact

The Department of State benefits from the provision of professional, scientific, and technical services. These services are crucial for supporting the operational needs of the agency. The contract's impact is primarily within Virginia, where the services are likely to be performed. The contract may support a workforce of professionals in technical and scientific fields.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Non-competitive award limits price discovery and potential savings.
Time and Materials contract type carries inherent risk of cost overruns.
Broad service category makes it difficult to assess specific value and necessity.
Lack of competition may not yield the best value for taxpayer dollars.

Positive Signals

Contract supports essential professional, scientific, and technical services for the agency.
Specific duration and funding indicate a defined need for these services.
Award to a single vendor may ensure continuity of critical operations.

Sector Analysis

The professional, scientific, and technical services sector is vast, encompassing a wide range of specialized expertise. This contract falls under NAICS code 541990, 'All Other Professional, Scientific, and Technical Services,' which is a catch-all for services not classified elsewhere. The market for such services is competitive, but the sole-source nature of this award bypasses typical market dynamics. Comparable spending benchmarks are difficult to establish without more specific service details.

Small Business Impact

There is no indication that this contract includes a small business set-aside. The sole-source award to OBXTEK INC. means that subcontracting opportunities for small businesses are not guaranteed through a competitive process. The impact on the small business ecosystem depends on OBXTEK's own subcontracting practices and whether they are encouraged to engage small businesses.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of State's contracting and program management offices. Accountability measures would be defined in the contract terms and conditions. Transparency is limited due to the sole-source nature of the award, and further details on oversight mechanisms would require access to internal agency documentation.

Related Government Programs

Department of State Professional Services Contracts
Federal IT and Technical Support Services
Government-wide Acquisition Contracts (GWACs) for Professional Services

Risk Flags

Sole-source award
Time and Materials contract type
Broad service category (NAICS 541990)
Lack of performance data for contractor

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $7.5 million to OBXTEK INC. TSE STAFFING CONTRACT

Who is the contractor on this award?

The obligated recipient is OBXTEK INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $7.5 million.

What is the period of performance?

Start: 2025-09-30. End: 2026-06-30.

What specific services are being provided under this 'All Other Professional, Scientific, and Technical Services' contract?

The provided data does not specify the exact nature of the services rendered under NAICS code 541990. This code is a broad category that can include a wide array of professional, scientific, and technical activities not elsewhere classified. Examples could range from research and development support, technical consulting, environmental consulting, to specialized scientific testing. Without further details from the contract's statement of work, it is impossible to ascertain the precise value or necessity of these services. Understanding the specific deliverables is crucial for a comprehensive value assessment and for comparing this contract to others in similar domains.

What is the justification for awarding this contract on a sole-source basis?

The data indicates this contract was awarded as 'NOT COMPETED,' implying a sole-source or limited competition justification. Agencies typically sole-source contracts when only one vendor possesses the required capabilities, when there's an urgent need that precludes competition, or in certain small business set-aside scenarios. For a contract of this value ($7.54M), a robust justification is expected, detailing why full and open competition was not feasible or advantageous. Without this justification, it raises concerns about whether the government secured the best possible price and value, and whether opportunities for other qualified vendors were unfairly excluded.

How does the Time and Materials (T&M) contract type impact cost control and value for money?

Time and Materials (T&M) contracts are often used when the scope of work is not clearly defined or is expected to change. While flexible, T&M contracts place the burden of cost control on the government, as the contractor is reimbursed for direct labor hours at specified rates and for actual material costs. This structure can lead to cost overruns if not closely monitored and managed. For a contract valued at up to $7.54M, the government must implement stringent oversight, including detailed tracking of hours, validation of labor categories, and review of material costs, to ensure that the final cost reflects fair value and that the project stays within budget. Without effective oversight, T&M contracts can be less cost-effective than fixed-price alternatives.

What is OBXTEK INC.'s track record with the Department of State and similar contracts?

The provided data does not include information on OBXTEK INC.'s past performance or track record with the Department of State or other federal agencies. A thorough analysis would require reviewing contract databases (like FPDS or SAM.gov) for previous awards, performance evaluations (e.g., CPARS reports), and any history of disputes or issues. Understanding their experience with similar services, their performance quality, and their pricing history is essential for assessing the risk associated with this current award and for determining if they are the most capable and cost-effective provider.

How does the $7.54M contract value compare to historical spending on similar services by the Department of State?

The provided data does not offer historical spending figures for similar services by the Department of State, making a direct comparison difficult. To assess this, one would need to analyze past contracts awarded under NAICS code 541990 or related codes by the agency. Examining trends in contract values, durations, and competition levels over time would provide context. A significant increase in spending for similar services, especially if awarded non-competitively, could indicate potential inefficiencies or a lack of strategic sourcing. Conversely, it might reflect increased demand or new requirements.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 2000 CORPORATE RDG STE 400, MC LEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $7,541,650

Exercised Options: $7,541,650

Current Obligation: $7,541,650

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline