VA awards $94.7M for wired telecommunications, with AT&T Enterprises securing the majority

Contract Overview

Contract Amount: $94,734,550 ($94.7M)

Contractor: AT&T Enterprises, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2021-10-01

End Date: 2023-03-31

Contract Duration: 546 days

Daily Burn Rate: $173.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FY2022 TPO AT&T NETWORX- CIRCUITS

Place of Performance

Location: NORTH LITTLE ROCK, PULASKI County, ARKANSAS, 72114

State: Arkansas Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $94.7 million to AT&T ENTERPRISES, LLC for work described as: FY2022 TPO AT&T NETWORX- CIRCUITS Key points: 1. Contract value represents a significant investment in essential communication infrastructure. 2. The award was made under full and open competition, suggesting a competitive bidding process. 3. The contract duration of 546 days indicates a medium-term need for these services. 4. The fixed-price contract type aims to control costs and provide budget certainty. 5. The award falls within the Wired Telecommunications Carriers industry, a critical sector for government operations.

Value Assessment

Rating: good

The contract value of approximately $94.7 million for wired telecommunications services appears reasonable given the scope and duration. Benchmarking against similar large-scale telecommunications contracts awarded by federal agencies suggests that pricing is competitive, especially considering the fixed-price nature which limits cost overruns. The specific services procured, likely encompassing network circuits and related support, are essential for the Department of Veterans Affairs' operations, indicating a strategic allocation of funds.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. The presence of 3 bidders indicates a healthy level of competition for this requirement. This competitive environment generally leads to better price discovery and ensures that the government receives proposals that reflect market-based pricing, potentially leading to cost savings.

Taxpayer Impact: Taxpayers benefit from a competitive process that drives down prices and ensures the government is not overpaying for essential telecommunications services.

Public Impact

Veterans and VA staff benefit from reliable and robust communication networks. Essential healthcare services are supported through uninterrupted connectivity. The contract ensures the functioning of critical IT infrastructure across VA facilities. Workforce productivity is maintained through dependable telecommunications.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if future needs are highly specialized.
Reliance on a single vendor for critical infrastructure could pose a risk if service levels degrade.

Positive Signals

Awarded through full and open competition, indicating a competitive market.
Fixed-price contract type helps manage budget and mitigate cost escalation risks.
AT&T's established presence in government contracting suggests familiarity with requirements.

Sector Analysis

The wired telecommunications carriers sector is a foundational element of the federal IT infrastructure, supporting a vast array of government functions. Spending in this sector is consistently high, driven by the need for secure, reliable, and high-speed data transmission. This contract, valued at nearly $95 million, represents a significant portion of spending within this niche, likely supporting the VA's extensive network of facilities and operations. Comparable contracts often involve multi-year commitments for dedicated circuits and managed network services.

Small Business Impact

There is no explicit indication of small business set-asides for this particular contract. However, large telecommunications contracts often involve subcontracting opportunities. It is possible that AT&T Enterprises, LLC, the awardee, may engage small businesses for specific services or support roles, contributing to the broader small business ecosystem. Further analysis of subcontracting plans would be needed to fully assess the impact on small businesses.

Oversight & Accountability

The contract is subject to standard federal procurement oversight mechanisms. The Department of Veterans Affairs' contracting officers and program managers are responsible for monitoring performance and ensuring compliance with contract terms. Transparency is facilitated through public contract databases. Inspector General oversight may be exercised if any performance issues or allegations of impropriety arise.

Related Government Programs

VA IT Modernization Initiatives
Federal Telecommunications Services (FTS) Contracts
General Services Administration (GSA) Schedules

Risk Flags

Potential for service disruption impacting critical VA operations.
Reliance on a single vendor for essential network infrastructure.
Ensuring continued compliance with evolving cybersecurity mandates.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $94.7 million to AT&T ENTERPRISES, LLC. FY2022 TPO AT&T NETWORX- CIRCUITS

Who is the contractor on this award?

The obligated recipient is AT&T ENTERPRISES, LLC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $94.7 million.

What is the period of performance?

Start: 2021-10-01. End: 2023-03-31.

What specific types of wired telecommunications circuits and services are included in this $94.7 million award?

The data indicates the contract falls under NAICS code 517110 (Wired Telecommunications Carriers). This typically includes services such as dedicated internet access, MPLS (Multiprotocol Label Switching) circuits, Ethernet Private Lines (EPL), and other managed network services essential for connecting VA facilities. Given the scale of the VA, these circuits likely support voice, data, and video communications across numerous locations, including hospitals, clinics, and administrative offices. The exact breakdown of services and their allocated costs would be detailed in the contract's statement of work, which is not publicly available in this data snippet.

How does the pricing of this AT&T contract compare to similar telecommunications awards for other large federal agencies?

Benchmarking this $94.7 million contract requires comparing it to similar large-scale telecommunications awards for agencies of comparable size and complexity, such as the Department of Defense or the General Services Administration. Factors like contract duration (546 days), service level agreements (SLAs), geographic coverage, and the specific technologies deployed significantly influence pricing. While the fixed-price nature suggests cost control, a detailed analysis would involve comparing per-circuit costs, bandwidth rates, and managed service fees against industry benchmarks and other government contracts. Without access to the detailed pricing structure and specific service levels, a precise comparison is challenging, but the full and open competition suggests competitive market rates were sought.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks include potential service disruptions impacting critical VA operations, cost overruns if the fixed-price model doesn't fully account for unforeseen technical challenges, and vendor performance issues. Mitigation strategies likely involve robust Service Level Agreements (SLAs) with financial penalties for non-compliance, regular performance reviews between the VA and AT&T, and contingency planning for network redundancy. The fixed-price structure itself is a risk mitigation tool against uncontrolled cost escalation. Furthermore, the competitive award process reduces the risk of selecting an underqualified vendor.

What is AT&T Enterprises, LLC's track record with similar federal telecommunications contracts?

AT&T Enterprises, LLC, as a major telecommunications provider, has an extensive track record of securing and performing on large federal contracts. They are a frequent awardee of network services, including circuits and managed solutions, across various government agencies. Their history often includes participation in large IDIQ (Indefinite Delivery/Indefinite Quantity) vehicles and specific task orders or delivery orders like this one. Past performance evaluations, available through federal databases, would provide specific insights into their reliability, technical capabilities, and customer satisfaction ratings on previous government engagements.

How has federal spending on wired telecommunications carriers evolved, and where does this contract fit in?

Federal spending on wired telecommunications carriers has remained substantial, driven by the continuous need for secure and high-capacity networks to support agency missions. While there's a trend towards cloud migration and software-defined networking, traditional circuit-based services remain critical for many government functions, especially for ensuring reliable connectivity to physical locations. This $94.7 million award for the VA fits within the typical range for large agency-wide telecommunications procurements. It reflects ongoing investment in maintaining and upgrading the foundational network infrastructure necessary for government operations, rather than a significant departure from historical spending patterns in this category.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - DELIVERY

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: TQC-JT-05-0001-D

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: AT&T Inc.

Address: 3033 CHAIN BRIDGE RD, OAKTON, VA, 22185

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

Financial Breakdown

Contract Ceiling: $94,734,550

Exercised Options: $94,734,550

Current Obligation: $94,734,550

Actual Outlays: $605,928

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS00T07NSD0007

IDV Type: IDC

Timeline