Granite Telecommunications awarded $705K for VPN services, highlighting competition and long-term support

Contract Overview

Contract Amount: $704,833 ($704.8K)

Contractor: Granite Telecommunications, LLC

Awarding Agency: Railroad Retirement Board

Start Date: 2020-03-18

End Date: 2026-09-30

Contract Duration: 2,387 days

Daily Burn Rate: $295/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: VIRTUAL PRIVATE NETWORK SERVICES

Place of Performance

Location: CHICAGO, COOK County, ILLINOIS, 60611

State: Illinois Government Spending

Plain-Language Summary

Railroad Retirement Board obligated $704,833.38 to GRANITE TELECOMMUNICATIONS, LLC for work described as: VIRTUAL PRIVATE NETWORK SERVICES Key points: 1. Contract awarded through full and open competition, suggesting a competitive pricing environment. 2. The firm-fixed-price contract type provides cost certainty for the agency. 3. The duration of the contract, spanning over 6 years, indicates a need for sustained VPN services. 4. The North American Industry Classification System (NAICS) code 517110 points to the telecommunications sector. 5. The contract value appears moderate, requiring benchmarking against similar VPN service procurements.

Value Assessment

Rating: good

The contract value of approximately $705,000 over its full term (2020-2026) suggests a moderate annual spend for virtual private network services. Benchmarking against similar government contracts for VPN solutions is necessary to fully assess value for money. Given the firm-fixed-price structure, the Railroad Retirement Board has a clear understanding of costs, assuming the scope of services remains consistent. The number of bids received (5) indicates a reasonable level of interest, which can contribute to competitive pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with five bids received. This indicates that multiple vendors were able to compete for the requirement, suggesting a healthy market for these services. The presence of five bidders generally points towards a competitive process that should have driven prices towards market rates and allowed the agency to select the best value offering.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure services at the most advantageous price point, preventing potential overspending that could occur in less competitive scenarios.

Public Impact

The Railroad Retirement Board benefits from secure and reliable virtual private network services, essential for its operations. Employees of the Railroad Retirement Board will have access to necessary network infrastructure for remote work and data access. The contract supports the IT infrastructure of a federal agency responsible for administering retirement benefits for railroad workers. The geographic impact is primarily within Illinois, where the contractor is located, but the service supports a national agency.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration could lead to vendor lock-in if not managed carefully.
Reliance on a single vendor for critical VPN services poses a potential risk if the vendor experiences service disruptions.

Positive Signals

Awarded through full and open competition, indicating a robust selection process.
Firm-fixed-price contract provides budget certainty for the agency.
The contract supports essential IT infrastructure for a federal agency.

Sector Analysis

The contract falls within the Wired Telecommunications Carriers industry, a segment of the broader telecommunications sector. This sector is characterized by significant infrastructure investment and evolving technologies. Government spending on telecommunications services, including VPNs, is substantial and driven by the need for secure and reliable connectivity for federal agencies. Comparable spending benchmarks would involve analyzing other federal contracts for similar VPN solutions, considering factors like bandwidth, security features, and service level agreements.

Small Business Impact

The data provided does not indicate any specific small business set-aside provisions for this contract. As it was awarded under full and open competition, it is unlikely that small businesses were excluded, but there is no explicit mechanism to ensure their participation or benefit. Subcontracting opportunities for small businesses would depend on Granite Telecommunications' internal policies and the specific requirements of the VPN services provided.

Oversight & Accountability

The Railroad Retirement Board is responsible for overseeing this contract. As a firm-fixed-price contract, oversight would focus on ensuring that the services delivered meet the agreed-upon specifications and service levels. Transparency is generally maintained through contract award databases like FPDS. The Inspector General for the Railroad Retirement Board would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Federal Information Security Management Act (FISMA) compliance
General Services Administration (GSA) Schedule IT contracts
Cybersecurity initiatives

Risk Flags

Long-term contract duration
Reliance on a single vendor for critical infrastructure

Frequently Asked Questions

What is this federal contract paying for?

Railroad Retirement Board awarded $704,833.38 to GRANITE TELECOMMUNICATIONS, LLC. VIRTUAL PRIVATE NETWORK SERVICES

Who is the contractor on this award?

The obligated recipient is GRANITE TELECOMMUNICATIONS, LLC.

Which agency awarded this contract?

Awarding agency: Railroad Retirement Board (Railroad Retirement Board).

What is the total obligated amount?

The obligated amount is $704,833.38.

What is the period of performance?

Start: 2020-03-18. End: 2026-09-30.

What is the typical cost range for similar Virtual Private Network (VPN) services procured by federal agencies of comparable size to the Railroad Retirement Board?

Determining a precise cost range for similar VPN services requires detailed analysis of contract scope, including bandwidth requirements, number of users, security protocols, and service level agreements (SLAs). However, federal agencies often leverage large-scale telecommunications contracts, such as those available through the General Services Administration (GSA), which can offer competitive pricing due to volume. For a contract valued at approximately $705,000 over six years, the annual cost averages around $117,500. This figure needs to be compared against benchmarks for enterprise-level VPN solutions, considering that government contracts may include specific security mandates and reporting requirements that can influence pricing. Without specific details on the service level agreements and technical specifications, a direct comparison is challenging, but this annual spend appears moderate for supporting a federal agency's network needs.

How does the number of bidders (5) in this full and open competition compare to the average number of bids for similar telecommunications contracts?

Receiving five bids for a full and open competition is generally considered a healthy indicator of market interest and competition. The average number of bids can vary significantly depending on the specific service, technology, contract vehicle, and agency. For complex IT or telecommunications services, five bidders suggest that the requirement was well-defined and accessible to multiple qualified vendors. In some highly specialized or niche markets, fewer bidders might be expected, while in broader categories, more could participate. A competitive landscape with multiple bidders typically leads to better price discovery and potentially lower costs for the government compared to procurements with only one or two offers. This level of competition suggests that the Railroad Retirement Board likely received a range of proposals, allowing for a robust evaluation process.

What are the potential risks associated with a firm-fixed-price contract for VPN services lasting over six years?

Firm-fixed-price (FFP) contracts offer budget certainty, which is a significant advantage. However, for a long duration like over six years, potential risks include the contractor potentially becoming complacent if competition was limited or if market prices for VPN services decrease significantly over the contract period. There's also a risk that the contractor might not be incentivized to innovate or offer cost-saving efficiencies if the price is locked in for an extended term. Conversely, if the scope of services expands or unforeseen technical challenges arise that were not adequately addressed in the initial contract, the government might face difficulties in modifying the contract without potentially renegotiating prices unfavorably. Careful contract management and performance monitoring are crucial to mitigate these risks and ensure continued value.

What is the track record of Granite Telecommunications, LLC in performing federal contracts, particularly for telecommunications services?

Granite Telecommunications, LLC has a history of performing federal contracts. Information available through public databases like the Federal Procurement Data System (FPDS) can provide insights into their past performance, including contract values, agencies served, and types of services rendered. Analyzing their award history can reveal patterns in their service delivery, compliance, and overall reliability. While specific details on past performance for VPN services would require a deeper dive into individual contract records and performance evaluations (if publicly available), their continued participation in federal contracting suggests a capacity to meet government requirements. It is advisable to review their contract history for any red flags or consistent positive feedback regarding service quality and adherence to terms.

How does the total contract value of $704,833.38 compare to historical spending on VPN services by the Railroad Retirement Board or similar agencies?

The total contract value of approximately $705,000 over a period of roughly six years (March 2020 to September 2026) translates to an average annual expenditure of about $117,500 for VPN services. To assess this accurately, it needs to be compared against historical spending patterns for the Railroad Retirement Board (RRB) and similar-sized federal agencies. If the RRB previously spent significantly more or less on comparable services, this contract's value could be seen as an improvement or an area for concern. Benchmarking against agencies with similar IT infrastructure needs and user bases would provide a more robust comparison. Without access to the RRB's specific historical procurement data or detailed market research reports on VPN costs for federal agencies, it's difficult to definitively state whether this represents high or low spending, but the annual average appears moderate.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 60RRBH20Q0004

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 HERITAGE DR, QUINCY, MA, 02171

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $1,637,934

Exercised Options: $991,690

Current Obligation: $704,833

Actual Outlays: $482,446

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q17NSD3004

IDV Type: IDC

Timeline