DOT awards $69.2M for engineering services to Digitalibiz, LLC, with a 5-year performance period

Contract Overview

Contract Amount: $69,228,617 ($69.2M)

Contractor: Digitalibiz, LLC

Awarding Agency: Department of Transportation

Start Date: 2020-01-14

End Date: 2025-03-31

Contract Duration: 1,903 days

Daily Burn Rate: $36.4K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 4

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: 20-014-C8 PR FOR AWARD OF THE TECHNICAL, ENGINEERING, ADMINISTRATIVE, TRAINING AND PROGRAMMATIC SUPPORT SERVICES. THE AWARDING CO IS TUAN HUYNH AND KAREN DURAO IS THE COR.

Place of Performance

Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73169

State: Oklahoma Government Spending

Plain-Language Summary

Department of Transportation obligated $69.2 million to DIGITALIBIZ, LLC for work described as: 20-014-C8 PR FOR AWARD OF THE TECHNICAL, ENGINEERING, ADMINISTRATIVE, TRAINING AND PROGRAMMATIC SUPPORT SERVICES. THE AWARDING CO IS TUAN HUYNH AND KAREN DURAO IS THE COR. Key points: 1. Contract awarded under Simplified Acquisition Procedures (SAP), suggesting a focus on smaller procurements. 2. Time and Materials (T&M) contract type can pose cost control challenges if not closely managed. 3. The contract duration of 1903 days (approx. 5 years) indicates a long-term need for these services. 4. Awarded by the Federal Aviation Administration (FAA), highlighting a critical support function for aviation infrastructure. 5. The contract's value is substantial, requiring diligent oversight to ensure value for taxpayer money. 6. Engineering services are essential for the FAA's mission, supporting complex technical and programmatic needs.

Value Assessment

Rating: fair

The contract value of $69.2 million over approximately five years averages to about $13.8 million annually. Benchmarking this against similar large-scale engineering support contracts within the federal government is challenging without more specific service details. However, the Time and Materials (T&M) pricing structure, while common for services where scope is not fully defined, carries inherent risks of cost overruns if not managed with rigorous oversight and clear task definitions. The number of bidders (4) suggests some level of competition, but the final price relative to an independent government estimate is not provided, making a definitive value assessment difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was competed under Simplified Acquisition Procedures (SAP), which typically involves a limited number of bidders compared to full and open competition. Four bids were received, indicating some level of market interest. However, SAP is generally used for procurements valued below certain thresholds, and the $69.2 million total value might push the boundaries of typical SAP usage, depending on the specific FAR clauses invoked. The limited competition under SAP could potentially lead to less aggressive pricing than a broader competition.

Taxpayer Impact: The limited competition under SAP means taxpayers may not have benefited from the most competitive pricing achievable through a wider solicitation. While four bidders participated, the overall market reach was constrained, potentially impacting the government's ability to secure the lowest possible price.

Public Impact

The Federal Aviation Administration (FAA) benefits directly through the provision of essential technical, engineering, administrative, training, and programmatic support services. These services are critical for maintaining and advancing the safety, efficiency, and capacity of the National Airspace System (NAS). The geographic impact is national, as the FAA's operations and infrastructure span the entire United States. The contract supports a workforce skilled in engineering and technical disciplines, contributing to the federal government's capacity in these areas.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials (T&M) contract type can lead to cost escalation if not managed tightly.
Simplified Acquisition Procedures (SAP) may limit the breadth of competition, potentially impacting price.
The long contract duration requires sustained oversight to ensure continued performance and value.
Lack of specific performance metrics or outcome-based measures makes assessing effectiveness challenging.

Positive Signals

Awarded to a specific company, Digitalibiz, LLC, indicating a selection based on perceived capability.
The contract has a clear start and end date, providing a defined period for service delivery.
The contract is managed by a Contracting Officer's Representative (COR), a key role for oversight.
The Federal Aviation Administration's need for these services suggests a critical operational requirement is being met.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS code 541330), a significant segment of the federal contracting market. The federal government is a major consumer of engineering services, particularly agencies like the FAA that manage complex infrastructure and regulatory environments. Spending in this sector often supports research, design, development, and operational support for critical national systems. Comparable spending benchmarks would typically be found within large infrastructure projects or agency-specific technical support contracts, often running into tens or hundreds of millions of dollars.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a result, large businesses or those capable of performing at this scale were eligible. There is no explicit information regarding subcontracting plans for small businesses within this award notice. The impact on the small business ecosystem is therefore neutral to potentially negative if large prime contractors do not actively engage small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight is primarily vested in the Contracting Officer's Representative (COR), Karen Durao, who is responsible for monitoring performance and ensuring compliance with contract terms. The contract's performance is subject to standard federal procurement regulations and agency-specific policies within the Department of Transportation and the Federal Aviation Administration. Transparency is facilitated through contract databases, but detailed performance reports or Inspector General involvement are not specified in this award notice.

Related Government Programs

Federal Aviation Administration Technical Support Services
Department of Transportation Engineering Contracts
Air Traffic Control System Modernization Support
Aerospace Engineering and Development Contracts
Government Program Management Support

Risk Flags

Potential for cost overruns due to T&M pricing structure.
Limited competition under SAP may affect optimal price discovery.
Need for vigilant oversight due to contract length and complexity.
Scope definition and management are critical risk areas for T&M contracts.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $69.2 million to DIGITALIBIZ, LLC. 20-014-C8 PR FOR AWARD OF THE TECHNICAL, ENGINEERING, ADMINISTRATIVE, TRAINING AND PROGRAMMATIC SUPPORT SERVICES. THE AWARDING CO IS TUAN HUYNH AND KAREN DURAO IS THE COR.

Who is the contractor on this award?

The obligated recipient is DIGITALIBIZ, LLC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $69.2 million.

What is the period of performance?

Start: 2020-01-14. End: 2025-03-31.

What is the track record of Digitalibiz, LLC in performing similar federal contracts, particularly with the FAA?

Assessing the track record of Digitalibiz, LLC requires a deeper dive into federal procurement databases like SAM.gov or FPDS. While this award notice identifies the contractor and contract value, it does not provide historical performance data. Generally, agencies evaluate past performance as part of the source selection process. For this specific contract, the FAA would have reviewed Digitalibiz's prior experience, past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and financial stability. Without access to those specific evaluations or a broader contract history for Digitalibiz, it's difficult to definitively state their track record. However, receiving an award of this magnitude suggests they met the agency's minimum requirements for capability and experience.

How does the awarded price of $69.2 million compare to similar engineering support contracts for the FAA or other transportation agencies?

Direct comparison of the $69.2 million award is challenging without knowing the precise scope of services, deliverables, and labor categories involved. However, the Federal Aviation Administration (FAA) frequently awards large contracts for technical, engineering, and programmatic support. For instance, contracts supporting the Next Generation Air Transportation System (NextGen) or major infrastructure upgrades can easily reach similar or higher values. The average annual value of approximately $13.8 million for this contract is substantial but not unprecedented for specialized federal engineering support. Benchmarking would ideally involve comparing the loaded labor rates, overhead, and profit margins against industry standards and other government contracts for comparable skill sets and service levels.

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

The primary risks with a Time and Materials (T&M) contract of this magnitude ($69.2M over ~5 years) revolve around cost control and scope creep. Unlike fixed-price contracts, T&M agreements reimburse the contractor for direct labor hours at specified rates and for the cost of materials. This structure can incentivize longer task durations or less efficient work if not meticulously managed. Key risks include: 1) Uncontrolled cost growth if labor hours or material costs exceed projections. 2) Difficulty in defining and managing the 'scope' of work, leading to potential disputes or overcharging. 3) Contractor inefficiency being rewarded, as more hours worked directly translates to more revenue. Robust oversight, clear task orders, regular progress reviews, and strong COR involvement are critical to mitigate these risks.

What specific engineering or technical services does this contract encompass for the FAA?

This contract, awarded under the title 'TECHNICAL, ENGINEERING, ADMINISTRATIVE, TRAINING AND PROGRAMMATIC SUPPORT SERVICES,' is broad. For the Federal Aviation Administration (FAA), these services likely encompass a wide range of critical functions supporting the National Airspace System (NAS). This could include: systems engineering for air traffic control modernization (like NextGen), technical analysis of aviation safety data, development and delivery of training programs for FAA personnel, administrative support for technical projects, acquisition support, lifecycle management of aviation systems, and programmatic support for major FAA initiatives. The exact breakdown would be detailed in the specific task orders issued under this contract.

How has federal spending on engineering services, particularly by the FAA, trended in recent years?

Federal spending on engineering services, including by the FAA, has generally remained robust, driven by the need to maintain and modernize critical infrastructure, support complex technological advancements, and ensure regulatory compliance. The FAA, in particular, has consistently invested significant funds in areas like air traffic control modernization (NextGen), airport infrastructure improvements, and aviation safety research. While specific year-over-year trends can fluctuate based on budget appropriations, major program cycles, and national priorities, the overall demand for engineering expertise within the FAA and other transportation-related agencies remains high. Factors like aging infrastructure, evolving technology (e.g., drones, AI in aviation), and cybersecurity needs continue to drive sustained spending in this sector.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

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

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 4

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Chickasaw Nation

Address: 9210 CORPORATE BLVD STE 410, ROCKVILLE, MD, 20850

Business Categories: 8(a) Program Participant, Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Small Business, Small Disadvantaged Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $69,576,374

Exercised Options: $69,228,617

Current Obligation: $69,228,617

Actual Outlays: $69,228,616

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: DTFAWA10A00007

IDV Type: BPA

Timeline