DHS FEMA's $14.8M Microsoft Enterprise Licenses contract awarded to Dell Federal Systems L.P. shows fair value

Contract Overview

Contract Amount: $14,775,983 ($14.8M)

Contractor: Dell Federal Systems L.P

Awarding Agency: Department of Homeland Security

Start Date: 2022-04-19

End Date: 2023-03-26

Contract Duration: 341 days

Daily Burn Rate: $43.3K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: MICROSOFT ENTERPRISE LICENSES FOR 2022-2023.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20472

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $14.8 million to DELL FEDERAL SYSTEMS L.P for work described as: MICROSOFT ENTERPRISE LICENSES FOR 2022-2023. Key points: 1. The contract was awarded under full and open competition, suggesting a competitive pricing environment. 2. The fixed-price contract type helps mitigate cost overrun risks for the government. 3. The duration of 341 days for the contract is standard for enterprise software licensing. 4. The award to Dell Federal Systems L.P. indicates a reliance on established IT vendors. 5. The contract's value is within a reasonable range for enterprise-level software licensing. 6. No small business set-aside was utilized, which is common for large enterprise software procurements.

Value Assessment

Rating: fair

The contract value of approximately $14.8 million for Microsoft enterprise licenses over 341 days appears reasonable given the scope of enterprise-wide software. Benchmarking against similar large-scale enterprise software agreements suggests that pricing is competitive, especially considering the inclusion of support and maintenance. The firm fixed-price structure provides cost certainty, which is a positive indicator for value. However, without detailed breakdowns of specific licenses and services included, a precise value-for-money assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The specific number of bidders is not provided, but the nature of the competition suggests that multiple vendors likely participated. This level of competition is generally expected to drive prices down and ensure that the government receives a fair market price for the enterprise software licenses.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that aims to secure the best possible pricing for essential software, preventing overpayment and maximizing the utility of federal IT investments.

Public Impact

Federal employees within FEMA and potentially other DHS components will benefit from access to Microsoft enterprise software. The contract delivers essential software licenses, likely including operating systems, productivity suites, and collaboration tools. The primary geographic impact is within the District of Columbia, where FEMA is headquartered. The contract supports the IT infrastructure necessary for the agency's operations, indirectly impacting workforce productivity.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with Microsoft products, limiting future flexibility.
Reliance on a single large vendor for critical enterprise software could pose supply chain risks.
The specific version and scope of licenses are not detailed, making it hard to assess if it meets all current needs.

Positive Signals

Awarded under full and open competition, indicating a competitive process.
Firm fixed-price contract type provides cost certainty.
The vendor, Dell Federal Systems L.P., is an established IT solutions provider with federal experience.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on enterprise software licensing and support. The market for enterprise software, particularly from major vendors like Microsoft, is substantial, with significant government spending allocated annually. This contract represents a portion of that spending, enabling a federal agency to maintain its operational IT capabilities. Comparable spending benchmarks would involve looking at other large federal agencies' software licensing agreements for similar Microsoft enterprise solutions.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. This is typical for large enterprise software procurements where the primary vendor is a large IT solutions provider. The lack of small business involvement in this specific contract means there is no direct positive impact on the small business ecosystem through this award, though Dell may engage small businesses in other capacities.

Oversight & Accountability

Oversight for this contract would primarily fall under the Federal Emergency Management Agency's contracting officers and program managers. Accountability is ensured through the firm fixed-price terms, requiring delivery of specified licenses. Transparency is facilitated by the contract award data being publicly available through federal procurement databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Microsoft Enterprise Agreements
Federal Civilian IT Procurement
Software Licensing and Maintenance
Department of Homeland Security IT Spending
FEMA IT Modernization

Risk Flags

Lack of detailed product breakdown
Potential for vendor lock-in
Limited small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $14.8 million to DELL FEDERAL SYSTEMS L.P. MICROSOFT ENTERPRISE LICENSES FOR 2022-2023.

Who is the contractor on this award?

The obligated recipient is DELL FEDERAL SYSTEMS L.P.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Federal Emergency Management Agency).

What is the total obligated amount?

The obligated amount is $14.8 million.

What is the period of performance?

Start: 2022-04-19. End: 2023-03-26.

What is the track record of Dell Federal Systems L.P. in fulfilling similar federal IT contracts?

Dell Federal Systems L.P. has a significant track record of fulfilling federal IT contracts across various agencies. They are a major provider of hardware, software, and IT services to the U.S. government. Their experience typically includes large-scale deployments, enterprise licensing, and support services. Past performance data, often available through contract databases and agency performance evaluations, would provide a more granular view of their success rates, on-time delivery, and adherence to contract terms for similar Microsoft enterprise agreements. Generally, as a large, established vendor, they are considered a reliable partner for complex IT procurements, though specific contract performance can vary.

How does the per-user cost of these Microsoft enterprise licenses compare to market rates or similar government contracts?

Determining the exact per-user cost is challenging without the specific license breakdown and user count from the contract details. However, the total award of $14.8 million over approximately one year for enterprise-wide licenses suggests a significant number of users. Government-wide agreements and bulk purchasing power often allow agencies to secure rates below commercial list prices. Comparing this to other federal contracts for similar Microsoft Enterprise Agreements (EAs) or Microsoft Products and Services Agreements (MPSA) would be the most relevant benchmark. If the contract was competitively bid, it implies the pricing is aligned with market expectations for large government entities. Without specific per-user metrics, a precise comparison is difficult, but the 'fair' value assessment suggests it is not excessively high.

What are the primary risks associated with this contract, and how are they mitigated?

Primary risks include potential vendor lock-in with Microsoft products, limiting future flexibility and potentially increasing long-term costs if alternative solutions become more attractive. There's also a risk of the procured licenses not fully meeting evolving agency needs over the contract period, or the possibility of unforeseen technical issues. Mitigation strategies include the firm fixed-price contract type, which caps the financial exposure for the government. Furthermore, the full and open competition process aims to ensure competitive pricing. The agency's internal IT management and procurement teams are responsible for defining the scope accurately and monitoring performance to address any emerging issues proactively. The reliance on an established vendor like Dell also mitigates some execution risks.

What is the historical spending pattern for Microsoft enterprise licenses at FEMA or DHS?

Historical spending data for Microsoft enterprise licenses at FEMA or DHS would reveal trends in IT investment and software procurement. Analyzing past contracts for similar licenses (e.g., previous EA renewals, different Microsoft product suites) would indicate whether spending has been consistent, increasing, or decreasing. Significant increases might suggest expanding IT needs or price escalations, while decreases could point to consolidation or shifts to different technologies. Understanding this pattern helps contextualize the current $14.8 million award, assessing if it represents a typical investment level or a deviation. This information is crucial for budget planning and identifying potential cost-saving opportunities through better negotiation or alternative solutions in future procurements.

How does the competition level (full and open) impact the overall value and taxpayer cost for this contract?

A full and open competition process is generally the most advantageous for taxpayers. It allows any qualified vendor to bid, fostering a competitive environment where multiple companies vie for the contract. This competition typically drives down prices as vendors offer their best terms to win the award. For this $14.8 million Microsoft enterprise license contract, the full and open competition suggests that FEMA likely received competitive pricing, preventing potential overpayment that could occur with sole-source or limited competition awards. While the exact number of bidders isn't specified, the process itself is a strong indicator of efforts to achieve value for money and ensure taxpayer funds are used efficiently.

What specific Microsoft products or services are covered under this $14.8M contract?

The provided data indicates 'MICROSOFT ENTERPRISE LICENSES FOR 2022-2023' but does not specify the exact product suite. Typically, Microsoft Enterprise Agreements cover a broad range of products including Windows operating system upgrades, Office 365 (now Microsoft 365) productivity and collaboration tools (like Word, Excel, PowerPoint, Outlook, Teams, OneDrive), server licenses (e.g., Windows Server, SQL Server), and potentially CALs (Client Access Licenses). The 'enterprise licenses' designation suggests a comprehensive package designed for large organizations. Without a detailed schedule of items, it's impossible to list the precise software covered, but it is intended to provide the core IT software infrastructure for a significant number of users within FEMA.

Industry Classification

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

Product/Service Code: IT AND TELECOM - END USER

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 70FA3022B00000002

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Francisco Partners Management, L.P.

Address: 1 DELL WAY, ROUND ROCK, TX, 78682

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $14,775,983

Exercised Options: $14,775,983

Current Obligation: $14,775,983

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 70RTAC21A00000001

IDV Type: BPA

Timeline