VA awards $5.6M contract for C-CURE 9000 alarm system maintenance, raising value-for-money questions

Contract Overview

Contract Amount: $5,638,561 ($5.6M)

Contractor: Siemens Industry Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2021-01-01

End Date: 2026-04-30

Contract Duration: 1,945 days

Daily Burn Rate: $2.9K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: C-CURE 9000 ALARM SYSTEM ANNUAL SERVICE AND MAINT

Place of Performance

Location: BUFFALO GROVE, LAKE County, ILLINOIS, 60089

State: Illinois Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $5.6 million to SIEMENS INDUSTRY INC for work described as: C-CURE 9000 ALARM SYSTEM ANNUAL SERVICE AND MAINT Key points: 1. The contract's value-for-money is questionable given the lack of competition and the extended duration. 2. Competition dynamics are absent, as the contract was not competed under SAP, suggesting potential price inefficiencies. 3. Risk indicators include the sole-source nature and the long performance period, which could lead to cost overruns. 4. Performance context shows this is an annual service and maintenance contract for an existing security system. 5. Sector positioning places this within the security systems services industry, specifically for alarm systems.

Value Assessment

Rating: questionable

The annual cost of approximately $1.13 million for alarm system maintenance appears high without competitive benchmarking. Given the contract's sole-source nature and the lack of detailed performance metrics provided, it is difficult to definitively assess value for money. Comparing this to similar service contracts for alarm systems across federal agencies would be necessary for a more robust evaluation, but the absence of competition suggests potential for inflated pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the Simplified Acquisition Procedures (SAP), indicating it was likely awarded on a sole-source basis. The absence of multiple bidders means there was no opportunity for price discovery through a competitive process. This lack of competition limits the government's ability to secure the most favorable pricing and terms.

Taxpayer Impact: Taxpayers may be paying a premium for this service due to the lack of competitive pressure. Without a bidding process, there is no assurance that the selected vendor's price reflects market rates or offers the best value.

Public Impact

The Department of Veterans Affairs (VA) benefits from the continued operation and maintenance of its C-CURE 9000 alarm system. Services delivered include annual maintenance and support for the security system, ensuring its functionality. The geographic impact is localized to Illinois, where the contract is being performed. Workforce implications are minimal, likely involving specialized technicians for maintenance and repair.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Long contract duration (nearly 5 years) could lock in potentially unfavorable pricing.
Sole-source award limits transparency and oversight.
Absence of competitive bidding reduces incentive for vendor innovation or cost reduction.

Positive Signals

Ensures continued operation of a critical security system for the VA.
Firm Fixed Price contract provides cost certainty for the government.
Siemens Industry Inc. is an established provider of security systems.

Sector Analysis

This contract falls within the Security Systems Services sector, specifically focusing on alarm systems. The market for security system maintenance is competitive, with numerous providers offering similar services. However, government procurement processes, especially sole-source awards, can limit access for smaller or specialized firms. Benchmarking against other federal contracts for similar alarm system maintenance would provide further context on pricing and service levels.

Small Business Impact

The contract data indicates that small business participation was not a factor, as the 'sb' field is false and the contract was not competed under SAP. There is no indication of small business set-aside or subcontracting requirements. This suggests that the contract was awarded directly to a large business without specific provisions to engage small businesses.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting officers and program managers. As a sole-source award, transparency might be limited compared to competed contracts. Accountability measures would be defined in the contract terms, focusing on service delivery and maintenance standards. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Protective Service Contracts
Physical Security System Maintenance
Department of Veterans Affairs IT and Facilities Management

Risk Flags

Sole-source award
Lack of competition
Potentially high annual cost
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $5.6 million to SIEMENS INDUSTRY INC. C-CURE 9000 ALARM SYSTEM ANNUAL SERVICE AND MAINT

Who is the contractor on this award?

The obligated recipient is SIEMENS INDUSTRY INC.

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 $5.6 million.

What is the period of performance?

Start: 2021-01-01. End: 2026-04-30.

What is the track record of Siemens Industry Inc. in providing C-CURE 9000 alarm system maintenance to federal agencies?

Siemens Industry Inc. is a large, established company with a significant presence in the security systems market. While specific details on their track record for C-CURE 9000 maintenance to federal agencies are not provided in this data, their general experience in providing security solutions suggests they possess the technical capabilities. However, the sole-source nature of this particular award means that the VA did not leverage a competitive process to evaluate Siemens' specific performance or pricing against other potential vendors for this contract. Further research into past performance evaluations and other federal contracts awarded to Siemens for similar services would be necessary to fully assess their track record in this specific context.

How does the annual cost of $1.13 million compare to market rates for similar alarm system maintenance contracts?

Without specific details on the scope of services, the number of devices covered, and the service level agreements, it is challenging to provide a precise market rate comparison. However, an annual cost of approximately $1.13 million for alarm system maintenance, especially for a single system like C-CURE 9000, appears to be on the higher end, particularly given the lack of competition. Typical federal contracts for alarm system maintenance can range significantly based on system complexity and coverage. The absence of competitive bidding in this sole-source award means the government did not benefit from market forces that would typically drive down prices. A thorough benchmark analysis against similar contracts awarded through full and open competition would be required to determine if this price is indeed competitive.

What are the primary risks associated with a sole-source contract for critical security system maintenance?

The primary risks associated with a sole-source contract for critical security system maintenance include potential overpricing due to the lack of competitive pressure, reduced incentive for the contractor to innovate or improve service quality, and a lack of transparency in the procurement process. Taxpayers may bear a higher cost than necessary. Furthermore, the government becomes heavily reliant on a single vendor, which can create vulnerabilities if the vendor experiences financial difficulties, changes business strategy, or fails to meet performance expectations. The extended duration of this contract (nearly five years) exacerbates these risks by locking the government into a single provider for an extended period without the opportunity to re-evaluate market options.

What is the expected effectiveness of the C-CURE 9000 alarm system maintenance under this contract?

The effectiveness of the C-CURE 9000 alarm system maintenance under this contract is expected to ensure the continued operational status and reliability of the security system. The contract specifies annual service and maintenance, which typically includes preventative maintenance, software updates, and emergency repair services. The effectiveness will largely depend on the quality of service provided by Siemens Industry Inc. and the clarity of the service level agreements within the contract. While the contract aims to maintain the system's functionality, its overall effectiveness in enhancing security posture is contingent on factors beyond just maintenance, such as system design, integration, and user protocols. The firm fixed price nature suggests a focus on defined service delivery.

How does this contract's spending compare to historical VA spending on security systems maintenance?

This contract represents an annual expenditure of approximately $1.13 million for the maintenance of the C-CURE 9000 alarm system. To assess how this compares to historical VA spending, one would need access to historical contract data for security systems maintenance across the VA. Without that comparative data, it's difficult to determine if this amount is an increase, decrease, or consistent with past spending patterns. Factors such as inflation, system upgrades, changes in the number of facilities managed, or shifts in security requirements could all influence historical spending trends. A comprehensive analysis would involve reviewing VA's procurement history for similar services over several fiscal years.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Security Systems Services (except Locksmiths)

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1000 DEERFIELD PKWY, BUFFALO GROVE, IL, 60089

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

Financial Breakdown

Contract Ceiling: $5,638,561

Exercised Options: $5,638,561

Current Obligation: $5,638,561

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline