VA awards $15.4M for encrypted data backup, with 5 bidders competing

Contract Overview

Contract Amount: $15,370,054 ($15.4M)

Contractor: Fedstore Corporation

Awarding Agency: Department of Veterans Affairs

Start Date: 2022-08-04

End Date: 2027-03-28

Contract Duration: 1,697 days

Daily Burn Rate: $9.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: EO14042: TAPELESS BACKUP ENCRYPTION BASE PERIOD

Place of Performance

Location: CHICAGO, COOK County, ILLINOIS, 60616

State: Illinois Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $15.4 million to FEDSTORE CORPORATION for work described as: EO14042: TAPELESS BACKUP ENCRYPTION BASE PERIOD Key points: 1. Contract value appears reasonable given the 5-year duration and specialized IT service. 2. Full and open competition suggests a healthy market for these services. 3. Potential risks include vendor lock-in and the need for ongoing security updates. 4. Performance context is critical for ensuring data integrity and compliance. 5. This contract falls within the broader IT services sector, specifically data management. 6. The fixed-price structure shifts performance risk to the contractor.

Value Assessment

Rating: good

The contract's total value of $15.4 million over approximately five years suggests a moderate annual spend for IT services. Benchmarking against similar government contracts for data backup and encryption services would provide a clearer picture of value for money. However, the fixed-price nature of the contract indicates that the agency has negotiated a set cost, which can be advantageous if the scope is well-defined. The number of bidders (5) also suggests a competitive environment that likely contributed to a fair price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that the solicitation was broadly advertised, and multiple responsible sources were permitted to submit offers. The presence of five bidders suggests a competitive marketplace for these specialized IT services. A higher number of bidders generally leads to better price discovery and potentially lower costs for the government.

Taxpayer Impact: The robust competition for this contract is beneficial for taxpayers, as it likely drove down the price and ensured the government received competitive offers for essential data backup and encryption services.

Public Impact

Veterans Affairs (VA) benefits from enhanced data security and disaster recovery capabilities. Services delivered include secure, encrypted data backup solutions. Geographic impact is primarily within the VA's operational footprint, supporting its IT infrastructure. Workforce implications are minimal for the VA, with the primary labor provided by the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Ensuring continuous compliance with evolving data encryption standards.
Managing potential vendor lock-in for critical backup infrastructure.
Verifying the contractor's ability to scale services as VA data needs grow.

Positive Signals

The use of a firm-fixed-price contract incentivizes contractor efficiency.
Full and open competition indicates a healthy market and likely competitive pricing.
The contract duration allows for stable service provision and planning.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on data storage, backup, and encryption services. The market for these services is large and competitive, with numerous providers offering solutions to both government and commercial clients. The VA's spending in this area is consistent with the increasing reliance on digital data and the critical need for its protection and availability. Comparable spending benchmarks would involve looking at other federal agencies' IT service contracts for similar data management solutions.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). While the primary awardee is not specified as a small business, the competitive nature of the 'full and open' solicitation means small businesses were eligible to compete. There is no explicit information on subcontracting plans for small businesses within this data, which could be a missed opportunity for small business participation.

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 in the firm-fixed-price contract terms, requiring the contractor to deliver specified services. Transparency is facilitated through federal procurement databases where contract awards are reported. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract were suspected.

Related Government Programs

Federal Data Center Consolidation Initiative
Cloud Computing Strategy
Cybersecurity Modernization Programs
IT Infrastructure Modernization

Risk Flags

Data Security Compliance
Vendor Performance Risk
Technological Obsolescence
Scalability of Services

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $15.4 million to FEDSTORE CORPORATION. EO14042: TAPELESS BACKUP ENCRYPTION BASE PERIOD

Who is the contractor on this award?

The obligated recipient is FEDSTORE CORPORATION.

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 $15.4 million.

What is the period of performance?

Start: 2022-08-04. End: 2027-03-28.

What is the track record of FedStore Corporation in delivering similar IT services to the federal government?

FedStore Corporation, as the contractor, has a history of providing goods and services through federal supply schedules and other contract vehicles. While specific performance details for this exact type of service are not provided in the summary data, their presence as a vendor suggests they meet basic eligibility and capability requirements. A deeper dive into their past performance ratings on similar contracts, particularly those involving IT services and data management for agencies like the VA, would be necessary to fully assess their track record. Government contract databases and past performance reviews would be the primary sources for this information.

How does the annual cost of this contract compare to industry benchmarks for encrypted data backup services?

The contract's total value of approximately $15.4 million over roughly 5.7 years (August 2022 to March 2027) equates to an average annual spend of about $2.7 million. Benchmarking this against industry rates for encrypted data backup and related IT services requires detailed analysis of service levels, data volumes, encryption standards, and geographic scope. Without these specifics, a precise comparison is difficult. However, given the specialized nature of secure data handling for a federal agency, this annual figure appears within a plausible range, especially considering the competitive bidding process which likely helped moderate costs.

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

Key risks include potential vendor lock-in, as the VA becomes reliant on FedStore's specific backup solution. Ensuring the contractor maintains robust security protocols and stays current with evolving encryption standards is another critical risk. Performance failures or data breaches could have severe consequences. Mitigation strategies likely involve clearly defined service level agreements (SLAs) within the contract, regular performance reviews, and potentially requiring the contractor to use industry-standard, interoperable technologies. The firm-fixed-price nature also shifts some performance risk to the contractor, incentivizing them to meet requirements.

How effective is the 'Full and Open Competition After Exclusion of Sources' approach in ensuring value for money for this type of IT service?

This competition approach is generally effective for ensuring value. By allowing all responsible sources to bid after an initial exclusion (which might be for specific technical qualifications or existing contract vehicles like GSA schedules), it broadens the potential bidder pool compared to a sole-source or limited competition. The presence of five bidders indicates sufficient market interest and competition, which typically drives down prices and encourages innovation. This method balances the need for specialized services with the government's mandate to seek competitive pricing, thus maximizing value for taxpayers.

What is the historical spending trend for data backup and encryption services within the Department of Veterans Affairs?

Analyzing historical spending trends for data backup and encryption services within the VA is crucial for context. While this specific contract represents a $15.4 million award over five years, understanding the VA's prior investments in similar technologies and services would reveal patterns of increasing or decreasing expenditure, shifts in technology adoption (e.g., from on-premise to cloud solutions), and the average cost per year. This historical data helps determine if the current award is an anomaly, an increase, or a decrease in overall spending for these critical IT functions.

Industry Classification

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

Product/Service Code: IT AND TELECOM - STORAGE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 RESEARCH CT STE 450, ROCKVILLE, MD, 20850

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

Financial Breakdown

Contract Ceiling: $15,783,743

Exercised Options: $15,370,054

Current Obligation: $15,370,054

Actual Outlays: $13,188,396

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: NNG15SD21B

IDV Type: GWAC

Timeline