VA awards $153.5M for IT portfolio products and sustainment to Govcio, LLC

Contract Overview

Contract Amount: $153,523,533 ($153.5M)

Contractor: Govcio, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2020-09-04

End Date: 2025-09-03

Contract Duration: 1,825 days

Daily Burn Rate: $84.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: VETPS- PORTFOLIO PRODUCTS AND SUSTAINMENT ACTIVITIES.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20001

State: District of Columbia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $153.5 million to GOVCIO, LLC for work described as: VETPS- PORTFOLIO PRODUCTS AND SUSTAINMENT ACTIVITIES. Key points: 1. Contract value represents a significant investment in IT sustainment. 2. Competition dynamics for this contract are assessed to understand pricing. 3. Risk indicators are evaluated based on contract type and duration. 4. Performance context is provided by comparing to similar IT services. 5. Sector positioning highlights the role of IT sustainment in government operations.

Value Assessment

Rating: good

The total award of $153.5 million over five years for IT portfolio products and sustainment activities appears reasonable given the scope. Benchmarking against similar large-scale IT sustainment contracts within the federal government suggests that the overall pricing is competitive. The use of Time and Materials (T&M) pricing, while offering flexibility, requires careful monitoring to ensure cost control and prevent scope creep, which is a common consideration for such contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of 4 bidders suggests a healthy level of competition for this significant IT services requirement. A competitive bidding process generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are being used efficiently by driving down costs through market forces.

Public Impact

Veterans Affairs (VA) benefits through enhanced IT portfolio products and sustainment. Services delivered include ongoing support, maintenance, and potential upgrades for critical IT systems. Geographic impact is primarily within the District of Columbia, where the agency is headquartered. Workforce implications may involve specialized IT professionals supporting the VA's technological infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials (T&M) contract type can lead to cost overruns if not closely managed.
Long contract duration (5 years) may reduce flexibility to adapt to rapidly changing technology needs.
Reliance on a single contractor for critical IT sustainment could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, indicating a competitive process.
Contractor (Govcio, LLC) has experience in providing IT services to the federal government.
The contract aims to ensure the continuity and effectiveness of essential VA IT systems.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on portfolio products and sustainment activities. The IT services market for the federal government is substantial, with agencies consistently investing in maintaining and modernizing their technological infrastructure. Comparable spending benchmarks for large-scale IT sustainment contracts often range in the tens to hundreds of millions of dollars, depending on the agency and scope of services.

Small Business Impact

This contract was not set aside for small businesses, and there is no explicit indication of subcontracting requirements for small businesses in the provided data. The focus appears to be on securing comprehensive IT sustainment services from a capable vendor, rather than specifically promoting small business participation through this particular award.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Veterans Affairs' contracting officers and program managers. Accountability measures are embedded within the contract terms, including performance standards and delivery schedules. Transparency is generally maintained through federal procurement databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

IT Portfolio Management
IT Sustainment Services
Computer Systems Design Services
Federal IT Modernization Programs

Risk Flags

Potential for cost overruns due to T&M contract type.
Risk of vendor lock-in with a long-term sustainment contract.
Need for robust oversight to manage scope and performance.
Dependency on contractor performance for critical IT systems.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $153.5 million to GOVCIO, LLC. VETPS- PORTFOLIO PRODUCTS AND SUSTAINMENT ACTIVITIES.

Who is the contractor on this award?

The obligated recipient is GOVCIO, 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 $153.5 million.

What is the period of performance?

Start: 2020-09-04. End: 2025-09-03.

What is the track record of Govcio, LLC in delivering similar IT sustainment services to the federal government?

Govcio, LLC has a history of providing IT services to various federal agencies. While specific details on past sustainment contracts of this magnitude are not detailed here, their presence in the federal contracting space suggests experience. A deeper dive into their past performance evaluations, contract history, and client feedback would be necessary to fully assess their track record for delivering complex IT portfolio products and sustainment activities. This includes examining their ability to meet deadlines, manage budgets, and provide high-quality technical support across diverse IT environments.

How does the awarded amount compare to the average cost of similar IT sustainment contracts within the VA or other large federal agencies?

The $153.5 million award for five years of IT portfolio products and sustainment activities places this contract within the upper tier of federal IT service agreements. Without specific, granular data on comparable contracts (e.g., exact scope, duration, and specific services), a precise comparison is challenging. However, large-scale IT sustainment efforts for agencies like the VA, which manage vast and complex systems, often command such figures. The key is to ensure that the pricing reflects the value delivered and remains competitive relative to market rates for similar services, which the 'good' value rating suggests is the case.

What are the primary risks associated with a Time and Materials (T&M) contract of this size and duration?

The primary risks associated with a Time and Materials (T&M) contract of this magnitude and duration ($153.5M over 5 years) revolve around cost control and potential scope creep. Unlike fixed-price contracts, T&M agreements reimburse the contractor for direct labor hours and materials used. This structure can incentivize longer project durations or less efficient work if not rigorously overseen. For the VA, risks include the potential for the total cost to exceed initial estimates if work is not managed efficiently, and the possibility that the scope of 'sustainment activities' could expand beyond what was originally intended, leading to unplanned expenditures. Robust oversight, clear task definitions, and regular performance reviews are crucial to mitigate these risks.

How effective is the 'full and open competition' process in ensuring the best value for taxpayer money in this IT services contract?

The 'full and open competition' process is generally considered the most effective method for ensuring the best value for taxpayer money in IT services contracts. By allowing all responsible sources to submit bids, it fosters a competitive environment where multiple vendors vie for the contract. This competition drives down prices, encourages innovation, and allows the government to select the offer that provides the optimal balance of cost, technical capability, and past performance. In this case, with 4 bidders, the process likely led to a more favorable outcome for the VA and taxpayers than a sole-source or limited competition award would have.

What are the potential implications of this contract on the broader IT services market, particularly for small businesses?

This contract, awarded to Govcio, LLC for $153.5 million, represents a significant portion of the federal IT services market. As it was awarded under full and open competition and does not appear to have small business set-aside provisions, its direct impact on small businesses may be limited unless Govcio, LLC actively engages them as subcontractors. However, large contracts like this can influence market dynamics by setting benchmarks for service delivery and pricing. It also signifies continued government investment in IT sustainment, which can create opportunities for specialized IT firms, including small businesses, that can support the prime contractor or compete for future, smaller-scale requirements.

Are there specific performance metrics or Key Performance Indicators (KPIs) associated with this contract to measure success?

While the provided data does not explicitly list the Key Performance Indicators (KPIs) for this contract, it is standard practice for federal IT services contracts of this magnitude and duration to include detailed performance metrics. These KPIs would typically cover areas such as system uptime, response times for support requests, resolution rates for technical issues, adherence to security protocols, and timely delivery of sustainment activities. The Department of Veterans Affairs' contracting officers and program managers are responsible for monitoring these metrics to ensure Govcio, LLC meets its contractual obligations and delivers the expected value. Failure to meet KPIs could result in contractual remedies.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 101 CONSTITUTION AVE NW STE 100W, WASHINGTON, DC, 20001

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

Financial Breakdown

Contract Ceiling: $153,967,728

Exercised Options: $153,523,533

Current Obligation: $153,523,533

Actual Outlays: $88,423,497

Subaward Activity

Number of Subawards: 73

Total Subaward Amount: $93,864,135

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: VA11816D1003

IDV Type: IDC

Timeline