GSA awards $79.8M for software development, with limited competition and a high per-unit cost

Contract Overview

Contract Amount: $79,799,245 ($79.8M)

Contractor: Global Connections to Employment, Inc.

Awarding Agency: General Services Administration

Start Date: 2019-07-13

End Date: 2022-07-12

Contract Duration: 1,095 days

Daily Burn Rate: $72.9K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SOFTWARE DEVELOPMENT MAINTENANCE SERVICES (SDMS)

Place of Performance

Location: SEASIDE, MONTEREY County, CALIFORNIA, 93955

State: California Government Spending

Plain-Language Summary

General Services Administration obligated $79.8 million to GLOBAL CONNECTIONS TO EMPLOYMENT, INC. for work described as: SOFTWARE DEVELOPMENT MAINTENANCE SERVICES (SDMS) Key points: 1. The contract's value of $79.8 million over three years suggests a significant investment in software development services. 2. Limited competition raises concerns about potential overpayment and reduced innovation. 3. The fixed-price contract type shifts some risk to the contractor, but the overall value proposition needs scrutiny. 4. Performance is situated within the broader context of IT services supporting federal agencies. 5. The contract falls under Computer Systems Design Services, a critical sector for government operations. 6. The award was made by the General Services Administration, a key procurement agency.

Value Assessment

Rating: questionable

The total award of $79.8 million for three years of software development and maintenance services appears high, especially given the limited competition. Benchmarking against similar contracts for Computer Systems Design Services is crucial. The provided benchmark of $7.28 million (likely annual or a different period) suggests this contract might be on the higher end, warranting a deeper dive into the scope of work and deliverables to justify the cost.

Cost Per Unit: $7.28M (benchmark provided, requires context for comparison)

Competition Analysis

Competition Level: limited

This contract was not competed openly, indicating a limited competition scenario. The specific reasons for this limitation are not detailed, but it typically means fewer vendors were considered or eligible. This lack of broad competition can lead to less favorable pricing and potentially limit the government's access to the best available solutions.

Taxpayer Impact: Limited competition means taxpayers may not have received the most cost-effective solution, as the government had fewer options to drive down prices through a competitive bidding process.

Public Impact

Federal agencies requiring software development and maintenance services are the primary beneficiaries. The contract delivers essential IT support, likely impacting the efficiency and functionality of government operations. The geographic impact is centered in California, where the contractor is located. Workforce implications include employment opportunities for software developers and related IT professionals within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may result in higher costs for taxpayers.
Lack of open competition could stifle innovation and reduce the pool of potential solutions.
The high contract value necessitates rigorous oversight to ensure value for money.
The specific reasons for the limited competition are not detailed, raising transparency concerns.

Positive Signals

The fixed-price contract type provides some cost certainty.
The General Services Administration is an experienced agency in managing IT procurements.
The contract duration of three years allows for sustained support and development.

Sector Analysis

This contract falls within the Computer Systems Design Services sector, a vital component of the IT industry. This sector encompasses a wide range of services, including custom software development, IT consulting, and systems integration. The federal government is a significant consumer of these services, with spending often concentrated in areas like defense, intelligence, and civilian agency operations. Benchmarks for similar contracts can vary widely based on complexity, duration, and specific technical requirements.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. The primary contractor, Global Connections to Employment, Inc., is likely a larger entity, and the absence of a small business set-aside means opportunities for small business participation through subcontracting would depend on the prime contractor's own subcontracting plan, which is not detailed here.

Oversight & Accountability

Oversight for this contract would primarily fall under the purview of the General Services Administration (GSA), specifically the Federal Acquisition Service. As a purchase order, it might be subject to internal GSA controls and potentially the Government Accountability Office (GAO) if protests arise. Transparency is moderate, as the award details are public, but the rationale for limited competition and specific performance metrics would require further inquiry. Inspector General jurisdiction would depend on GSA's internal policies and any specific fraud or waste concerns that may arise.

Related Government Programs

General Services Administration IT Procurement
Computer Systems Design Services
Software Development Contracts
Federal Acquisition Service IT Services

Risk Flags

Limited competition raises concerns about value for money.
Lack of transparency regarding the justification for limited competition.
Potential for higher costs due to reduced market pressure.
Need for rigorous oversight to ensure deliverables meet expectations.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $79.8 million to GLOBAL CONNECTIONS TO EMPLOYMENT, INC.. SOFTWARE DEVELOPMENT MAINTENANCE SERVICES (SDMS)

Who is the contractor on this award?

The obligated recipient is GLOBAL CONNECTIONS TO EMPLOYMENT, INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $79.8 million.

What is the period of performance?

Start: 2019-07-13. End: 2022-07-12.

What is the specific scope of work for the Software Development Maintenance Services (SDMS) under this contract?

The provided data does not detail the specific scope of work for the Software Development Maintenance Services (SDMS). However, based on the North American Industry Classification System (NAICS) code 541512 (Computer Systems Design Services), the contract likely encompasses a range of activities including custom software development, system integration, IT consulting, and potentially ongoing maintenance and support for existing software systems. The $79.8 million award over three years suggests a substantial and ongoing need for these services, potentially involving complex systems or a large number of applications critical to the General Services Administration's operations.

Can the provided benchmark of $7.28 million be directly compared to the total contract value?

The provided benchmark of $7.28 million (br: 72876) requires significant contextualization to be directly compared to the total contract value of $79.8 million. It is unclear if this benchmark represents an annual cost, a per-project cost, or a cost for a specific type of service within the broader contract. If it represents an annual average, then the total contract value is roughly 11 times this benchmark over three years, which could indicate a higher cost or a significantly larger scope. Without knowing the period and specific services the benchmark applies to, a direct comparison is speculative and necessitates further data.

What are the potential risks associated with the 'NOT AVAILABLE FOR COMPETITION' contract type?

The 'NOT AVAILABLE FOR COMPETITION' (or limited competition) contract type presents several risks. Primarily, it can lead to higher costs for the government because the lack of open bidding reduces price pressure. It also limits the government's access to a wider range of innovative solutions and potentially more capable vendors. Furthermore, it raises concerns about fairness and transparency in the procurement process. Without a clear justification for limiting competition, there's a risk that the chosen contractor may not be the most qualified or cost-effective option available, potentially impacting program success and taxpayer value.

How does the fixed-price contract type (PT: FIRM FIXED PRICE) impact risk allocation in this contract?

A Firm Fixed Price (FFP) contract type generally shifts the majority of the cost risk to the contractor. This means the contractor is obligated to complete the work for the agreed-upon price, regardless of their actual costs. For the government, this provides cost certainty, as the total expenditure is known upfront. However, if the contractor significantly underestimates costs or encounters unforeseen challenges, they bear the loss. Conversely, if the contractor is highly efficient, they retain the profit. For this $79.8 million contract, the FFP structure aims to protect the government from cost overruns, but it also means the contractor has a strong incentive to control their own expenses.

What is the historical spending pattern for similar Software Development Maintenance Services (SDMS) by the General Services Administration?

The provided data does not include historical spending patterns for SDMS by the GSA. To assess this, one would need to analyze past GSA contracts for similar services, looking at award amounts, durations, competition levels, and contractor performance over several fiscal years. Understanding historical spending would help determine if the $79.8 million award is consistent with past investments, unusually high, or indicative of a new or expanded program. It would also reveal trends in competition and pricing within the GSA's IT procurement portfolio.

What are the implications of the contract being awarded in California (SN: CALIFORNIA) for federal IT service delivery?

The contract being awarded to a vendor located in California (SN: CALIFORNIA) has several implications. It suggests that the General Services Administration (GSA) is leveraging the robust technology sector present in California for its IT needs. This could mean access to a skilled workforce and a competitive market for IT services. However, it also raises questions about whether this location limits the GSA's ability to source talent or services from other regions, potentially impacting diversity in vendor selection or access to specialized expertise not concentrated in California. The physical location of the contractor may also influence project management and communication dynamics.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: ID03180056006

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1221 W LAKEVIEW AVE, PENSACOLA, FL, 32501

Business Categories: AbilityOne Program Participant, Category Business, Corporate Entity Tax Exempt, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $108,843,748

Exercised Options: $80,210,976

Current Obligation: $79,799,245

Actual Outlays: $5,077,858

Subaward Activity

Number of Subawards: 490

Total Subaward Amount: $947,110,932

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline