DoD's $47M Peraton contract for wired telecom services shows fair competition but raises value questions
Contract Overview
Contract Amount: $47,010,090 ($47.0M)
Contractor: Peraton Inc.
Awarding Agency: Department of Defense
Start Date: 2012-02-01
End Date: 2017-03-31
Contract Duration: 1,885 days
Daily Burn Rate: $24.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: LABOR HOURS
Sector: Other
Official Description: CORPORATE SERVICES SUPPORT: SERVICE DELIVERY (CSS: SD) TASK ORDER AWARD
Place of Performance
Location: SCOTT AFB, SAINT CLAIR County, ILLINOIS, 62225
State: Illinois Government Spending
Plain-Language Summary
Department of Defense obligated $47.0 million to PERATON INC. for work described as: CORPORATE SERVICES SUPPORT: SERVICE DELIVERY (CSS: SD) TASK ORDER AWARD Key points: 1. Contract awarded through full and open competition, indicating a healthy market. 2. Duration of 1885 days suggests a long-term need for these services. 3. The contract type (Labor Hours) can sometimes lead to cost overruns if not managed carefully. 4. No small business set-aside was utilized, potentially limiting opportunities for smaller firms. 5. The contract's value appears reasonable when benchmarked against similar telecom services. 6. Performance context is limited due to the nature of the data provided.
Value Assessment
Rating: fair
The contract's total value of approximately $47 million over five years averages to about $9.4 million annually. While not excessively high, the lack of detailed performance metrics or specific deliverables makes a definitive value assessment challenging. Benchmarking against similar wired telecommunications contracts for government agencies suggests this pricing is within a reasonable range, but without more granular data on the scope of services, it's difficult to ascertain if it represents excellent value for money. The 'Labor Hours' pricing model necessitates close oversight to ensure efficiency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit offers. The presence of 4 bids suggests a competitive environment, which generally benefits price discovery and can lead to more favorable terms for the government. However, the specific number of bidders does not inherently guarantee the lowest possible price without further analysis of the bids received and the evaluation criteria.
Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages multiple vendors to compete, potentially driving down costs and improving service quality.
Public Impact
The Department of Defense benefits from reliable wired telecommunications infrastructure, crucial for its operations. Services delivered likely include installation, maintenance, and support for network cabling and related infrastructure. The geographic impact is primarily within Illinois, where the contract was administered. Workforce implications include the employment of telecommunications technicians and support staff by the contractor.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost creep due to the 'Labor Hours' contract type if not closely monitored.
- Limited transparency on specific performance metrics makes it hard to gauge true value.
- Lack of small business participation could be a missed opportunity for economic inclusion.
Positive Signals
- Awarded through full and open competition, indicating a competitive market.
- The contract duration suggests a stable, long-term requirement met by the award.
- The contractor, Peraton Inc., has a significant presence in the government contracting space.
Sector Analysis
This contract falls within the broader telecommunications sector, specifically focusing on wired infrastructure. The market for government telecommunications services is substantial, with agencies relying heavily on robust networks for daily operations. Comparable spending benchmarks for similar wired telecommunications support contracts within the federal government vary widely based on scope, duration, and geographic coverage. This $47 million award over five years represents a moderate-sized contract within this domain.
Small Business Impact
This contract was not awarded as a small business set-aside, nor does it indicate any specific subcontracting requirements for small businesses in the provided data. This means that opportunities for small businesses to participate in this specific contract were likely limited to those who could compete directly with larger firms or were not explicitly sought through set-aside provisions. The absence of small business focus may limit the broader impact on the small business ecosystem for this particular award.
Oversight & Accountability
Oversight for this contract would typically be managed by contracting officers and program managers within USTRANSCOM. Accountability measures would be tied to the contract's performance work statement and delivery schedules. Transparency is generally facilitated through contract award databases like FPDS, where basic information is publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Defense Information Systems Agency (DISA) Telecommunications Contracts
- General Services Administration (GSA) IT Schedule Contracts
- Federal Network Infrastructure Services
- Wired Communications Support
Risk Flags
- Potential for cost overruns due to 'Labor Hours' pricing.
- Limited transparency on specific performance metrics.
- Lack of explicit small business participation.
Tags
department-of-defense, ustranscom, wired-telecommunications-carriers, full-and-open-competition, delivery-order, labor-hours, illinois, telecommunications-support, it-services, federal-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $47.0 million to PERATON INC.. CORPORATE SERVICES SUPPORT: SERVICE DELIVERY (CSS: SD) TASK ORDER AWARD
Who is the contractor on this award?
The obligated recipient is PERATON INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (USTRANSCOM).
What is the total obligated amount?
The obligated amount is $47.0 million.
What is the period of performance?
Start: 2012-02-01. End: 2017-03-31.
What is Peraton Inc.'s track record with similar federal telecommunications contracts?
Peraton Inc. has a substantial history of performing telecommunications and IT support services for the federal government. They have held numerous contracts across various agencies, including the Department of Defense, intelligence community, and civilian agencies. Their experience often encompasses network infrastructure, cybersecurity, and managed IT services. Analyzing their past performance on similar contracts, particularly those involving wired telecommunications and labor-hour based pricing, would provide insight into their ability to deliver within budget and schedule. Past performance reviews and contract close-out data, where available, are crucial for assessing their reliability and efficiency in executing complex telecom projects.
How does the $47 million value compare to similar wired telecommunications contracts awarded by the DoD?
The $47 million total value for this five-year contract (approximately $9.4 million annually) appears to be within a reasonable range for large-scale wired telecommunications support services for a major agency like the Department of Defense. However, direct comparisons are difficult without knowing the specific scope of services, geographic coverage, and technical requirements. Contracts for similar services can range from a few million to hundreds of millions of dollars depending on complexity. For instance, contracts involving nationwide network backbone upgrades would naturally be significantly higher than those focused on localized infrastructure support within a single state or region. Benchmarking against contracts with similar duration and service descriptions from agencies like DISA or other military branches would offer a more precise comparison.
What are the primary risks associated with a 'Labor Hours' contract type for telecommunications services?
The primary risk with a 'Labor Hours' contract type, especially for services like wired telecommunications support, is the potential for cost overruns if not managed diligently. Unlike fixed-price contracts, the government pays for the actual hours worked by contractor personnel, plus a fixed hourly rate. This model can incentivize longer task completion times or less efficient work if the contractor is not properly incentivized to be productive. Key risks include scope creep, inefficient labor utilization, and difficulty in accurately forecasting total costs. Robust oversight, clear task definitions, and performance monitoring are essential to mitigate these risks and ensure the government receives good value.
What is the typical duration for federal contracts of this nature, and how does this one compare?
Federal contracts for telecommunications services, particularly those involving infrastructure support and maintenance, often have durations ranging from one to five years, with options for extensions. A duration of 1885 days (approximately 5 years and 1 month) is quite typical for a contract of this magnitude and scope. Longer durations provide stability for both the agency and the contractor, allowing for long-term planning and relationship building. Shorter contracts might be used for more project-specific or rapidly evolving technology needs. This contract's duration aligns well with the expected lifecycle of maintaining and supporting wired telecommunications infrastructure, suggesting a stable, ongoing requirement.
What does the 'Wired Telecommunications Carriers' NAICS code (517110) imply about the services procured?
The North American Industry Classification System (NAICS) code 517110, 'Wired Telecommunications Carriers,' indicates that the services procured under this contract are related to the operation and maintenance of wired telecommunications networks. This typically includes services such as installing, repairing, and maintaining local and long-distance telephone lines, internet access lines, and other wired communication infrastructure. It encompasses activities like cabling, network equipment installation, and potentially the management of the physical network infrastructure. This code suggests the contract is focused on the tangible, physical aspects of telecommunications connectivity rather than purely software or wireless services.
How does the fact that this was a Delivery Order (aw='DELIVERY ORDER') impact the analysis?
The fact that this award is a 'Delivery Order' (aw='DELIVERY ORDER') implies that it was issued under a previously established indefinite-delivery, indefinite-quantity (IDIQ) contract or a similar multiple-award contract vehicle. This means the underlying contract was likely competed earlier, and this specific order represents a task or delivery against that larger framework. As a 'Delivery Order,' it signifies a specific procurement action for a defined set of goods or services within the scope of the parent contract. The analysis of competition and value should ideally consider the initial competition for the IDIQ vehicle, as well as the specifics of this particular order. The 'aw' field being 'DELIVERY ORDER' and not 'AWARD' suggests this is a task order against a larger contract.
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
Offers Received: 4
Pricing Type: LABOR HOURS (Z)
Evaluated Preference: NONE
Contractor Details
Parent Company: Veritas Capital Fund Management, L.L.C. (UEI: 078628925)
Address: 12975 WORLDGATE STE 7322, HERNDON, VA, 20170
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $61,784,850
Exercised Options: $52,363,645
Current Obligation: $47,010,090
Subaward Activity
Number of Subawards: 7
Total Subaward Amount: $788,356
Contract Characteristics
Consolidated Contract: Yes
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W91QUZ07D0001
IDV Type: IDC
Timeline
Start Date: 2012-02-01
Current End Date: 2017-03-31
Potential End Date: 2017-03-31 00:00:00
Last Modified: 2020-02-21
More Contracts from Peraton Inc.
- 200107!000034!5700!GZ80 !smc/Pks !F0470101C0001 !A!N!*!Y! !20001103!20061031!052819732!052819732!001216845!n!itt Industries, Inc , Systems !4410 E Fountain Blvd !colorado Sprin !co!80916!16000!041!08!colorado Springs !EL Paso !colorado !+000016429445!n!n!000000000000!ac26!rdte/Missile and Space Systems-Mgmt Support !A2 !missile and Space Systems !3000!NOT Discernable or Classified !541710!*!*!3! ! ! !*!*!*!B!*!*!B! !A !Y!R!2!003!B! !A!N!Z! ! !N!C!N! ! ! !c!c!a!a!000!a!c!n! ! ! !Y! ! !0001! — $1.7B (Department of Defense)
- THE Exploration and Space Communications Projects Division (ESC) IS a National Resource Located AT Goddard Space Flight Center (gsfc) Which Enables Scientific Discovery and Space Exploration by Providing Innovative and Mission-Effective Space Communications and Navigation Solutions to a Large Community of Diverse Customers. ESC Manages Operational Geostationary Communications Relay Satellites and Ground Systems for the Space Communications and Navigation (scan) Program AT Nasa Headquarters. Today, Scan Network Systems Consist of the Space Network (SN), the Near Earth Network (NEN), and the Deep Space Network (DSN). the Day-To-Day Management of These Three Networks IS Currently NOT Fully Consistent. IT IS the Intention of the Government to Unify the SN and NEN Where Practicable Under This Contract Using Integrated, Common Management Practices and Network Solutions — $1.5B (National Aeronautics and Space Administration)
- Nasa Goddard Space Flight Center's (gsfc) Goal for the Space Communications Networks Services Contract (scns) IS to Enable Mission Success for Every Customer Using Scns Services. KEY Objectives of the Scns Contract ARE to Decrease Cost and Maintain or Improve Operational Efficiency and Reliability, While Maintaining an Acceptable Level of Risk and Providing for Safe Operation of the Missions. the Contractor Shall Implement a Safety, Health, and Mission Assurance Program That Provides a Safe and Healthy Work Environment, Minimizes Program Risk, and Maximizes Nasa Mission Success. the Contractor Shall BE Responsible and Accountable for Achieving the Required Results. Core Requirement Functions, Such AS Configuration Management, Quality Assurance, ETC. ARE Required to Support Idiq Task Orders. the Space Network (SN) IS Comprised of a Fleet of On-Orbit Tracking and Data Relay Satellites (tdrs) and Associated Ground Systems That Provide Telecommunications Services. the Nature of the SN Architecture, I.E., Extremely Large Capital Investment, Contractor Operated Facilities, Continuous 24X7 Requirements, ETC., Lends Itself to a Core Requirements Approach. the Ground Network (GN) Consists of an Orbital Tracking Network and the Satellite Laser Ranging Network. the Nature of the Ground Network Architecture, I.E., Diverse MIX of Commercial and Government Assets, Evolving Geographic and Technical Customer Requirements, and Legacy Systems, ETC. Lends Itself to an Idiq Approach. Other Activities, I.E., Very Long Baseline Interferometry Network Operations and Maintenance (O&M), Electronic System Test Laboratory, Requirements Development, Hardware and Software Development, ETC. ARE Best Suited to an Idiq Approach in the Resource-Constrained Environment That Nasa Operates in — $1.2B (National Aeronautics and Space Administration)
- Operational Planning Implementation and Assessment Services (opias) Base Award — $800.8M (General Services Administration)
- Sitec 3 EOM Provides Ussocom With O&M Services to Maintain Netops, Maintain Systems & Network Infrastructure, Provide END User & Common Device Support, Provide Configuration, Change, License, & Asset Mgmt. Conduct Training and Perform Imacs Services — $651.0M (General Services Administration)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)