VA awards $414M Salesforce ELA to V3GATE, LLC for Other Computer Related Services
Contract Overview
Contract Amount: $414,057,917 ($414.1M)
Contractor: V3gate, LLC
Awarding Agency: Department of Veterans Affairs
Start Date: 2019-09-25
End Date: 2023-06-25
Contract Duration: 1,369 days
Daily Burn Rate: $302.5K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: SALESFORCE ELA
Place of Performance
Location: COLORADO SPRINGS, EL PASO County, COLORADO, 80921
State: Colorado Government Spending
Plain-Language Summary
Department of Veterans Affairs obligated $414.1 million to V3GATE, LLC for work described as: SALESFORCE ELA Key points: 1. Significant contract value of over $414 million for Salesforce Enterprise License Agreement. 2. Competition involved full and open after exclusion of sources, suggesting a specific justification. 3. Risk associated with a large, long-term software agreement and potential vendor lock-in. 4. Sector is IT services, specifically 'Other Computer Related Services'.
Value Assessment
Rating: fair
The contract value is substantial, but without specific pricing benchmarks for Salesforce ELAs of this scope and duration, a precise value assessment is difficult. The firm fixed price structure provides some cost certainty.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES'. This indicates that while competition was sought, specific sources may have been excluded, potentially impacting the breadth of price discovery.
Taxpayer Impact: Taxpayer funds are being utilized for a significant enterprise software license. The effectiveness of the procurement process in securing competitive pricing will determine the ultimate taxpayer impact.
Public Impact
Veterans will benefit from enhanced IT services and potentially improved access to VA systems. The large expenditure on a single software platform raises questions about long-term IT strategy and potential for vendor dependency. The 'exclusion of sources' clause warrants further investigation into the rationale and its impact on competition.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in with a large Salesforce ELA.
- Complexity of managing a long-term, high-value software contract.
- Justification for 'exclusion of sources' needs clarification.
Positive Signals
- Firm fixed price provides cost predictability.
- Long duration (1369 days) allows for sustained service delivery.
- Awarded by the Department of Veterans Affairs, indicating a focus on supporting veteran services.
Sector Analysis
This contract falls within the IT services sector, specifically 'Other Computer Related Services'. Spending benchmarks for large enterprise software agreements like this can vary widely based on vendor, scope, and negotiation.
Small Business Impact
The data does not indicate any specific set-asides for small businesses. The nature of this large enterprise license agreement may not lend itself to significant small business participation directly, though subcontractors could be involved.
Oversight & Accountability
Oversight would typically involve contract management by the VA's contracting officers and program managers to ensure deliverables are met and funds are used appropriately. The 'exclusion of sources' may also be subject to specific oversight reviews.
Related Government Programs
- Other Computer Related Services
- Department of Veterans Affairs Contracting
- Department of Veterans Affairs Programs
Risk Flags
- Potential for vendor lock-in.
- Lack of clarity on 'exclusion of sources' justification.
- Significant financial commitment for enterprise software.
- Complexity of managing large-scale software agreements.
Tags
other-computer-related-services, department-of-veterans-affairs, co, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Veterans Affairs awarded $414.1 million to V3GATE, LLC. SALESFORCE ELA
Who is the contractor on this award?
The obligated recipient is V3GATE, 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 $414.1 million.
What is the period of performance?
Start: 2019-09-25. End: 2023-06-25.
What was the specific justification for excluding certain sources in this full and open competition?
The justification for excluding sources in a 'full and open competition after exclusion of sources' award typically relates to specific technical requirements, existing infrastructure compatibility, or unique capabilities that only certain vendors can provide. Without further documentation, the precise reasons remain unclear, but it suggests a deliberate narrowing of the competitive pool based on predefined criteria.
How does the per-unit cost of this Salesforce ELA compare to similar government or commercial contracts?
A direct per-unit cost comparison is challenging without detailed breakdowns of licenses, user counts, and service levels included in this specific ELA. Salesforce pricing models are complex and vary significantly. Benchmarking would require access to detailed pricing data from comparable government or commercial contracts for similar-sized deployments.
What is the long-term risk associated with a single $414 million award for Salesforce software?
The primary long-term risk is vendor lock-in, making it difficult and costly to switch to alternative solutions in the future. There's also a risk of escalating costs if future renewals are not competitively bid or if the VA becomes overly reliant on Salesforce's ecosystem, potentially hindering innovation or flexibility.
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: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 555 MIDDLE CREEK PKWY STE 120, COLORADO SPRINGS, CO, 80921
Business Categories: Category Business, Hispanic American Owned Business, Limited Liability Corporation, Minority Owned Business, Partnership or Limited Liability Partnership, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business
Financial Breakdown
Contract Ceiling: $680,191,025
Exercised Options: $414,057,917
Current Obligation: $414,057,917
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Parent Contract
Parent Award PIID: NNG15SD27B
IDV Type: GWAC
Timeline
Start Date: 2019-09-25
Current End Date: 2023-06-25
Potential End Date: 2023-06-25 00:00:00
Last Modified: 2023-07-18
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