HHS awards $37.7M AWS contract to New Tech Solutions, Inc. for IT services

Contract Overview

Contract Amount: $37,745,996 ($37.7M)

Contractor: NEW Tech Solutions, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2022-09-19

End Date: 2026-04-20

Contract Duration: 1,309 days

Daily Burn Rate: $28.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: AMAZON WEB SERVICES

Place of Performance

Location: FREMONT, ALAMEDA County, CALIFORNIA, 94538

State: California Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $37.7 million to NEW TECH SOLUTIONS, INC. for work described as: AMAZON WEB SERVICES Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract duration of 1309 days indicates a significant, long-term need for these services. 3. The fixed-price contract type may offer cost certainty for the government. 4. The North American Industry Classification System (NAICS) code 541519 points to a broad range of computer-related services. 5. The awardee, New Tech Solutions, Inc., is a key player in delivering these specialized IT services. 6. The contract's value is substantial, reflecting the critical nature of the services provided. 7. The geographic location of the awardee in California may have implications for service delivery and local economic impact.

Value Assessment

Rating: good

The contract value of approximately $37.7 million over its duration represents a significant investment in IT services. Benchmarking this against similar AWS contracts is challenging without more specific service details. However, the fixed-price nature suggests an attempt to control costs. The number of bids received (6) indicates a moderate level of interest, which can be a positive sign for value, assuming the pricing is competitive.

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 a bid. Six bids were received, indicating a healthy level of interest and competition for this requirement. This competitive environment is generally favorable for price discovery and ensuring the government receives a fair market price.

Taxpayer Impact: The full and open competition process likely resulted in a more competitive price for taxpayers compared to a sole-source or limited competition award.

Public Impact

The Centers for Disease Control and Prevention (CDC) benefits from enhanced IT infrastructure and services. Essential public health services supported by robust cloud computing capabilities. Potential for improved data management and analysis to support public health initiatives. Workforce within the CDC may see improved tools and systems for their daily operations. Services are likely to support national-level public health efforts, with broad geographic impact.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with AWS services, requiring careful management of future transitions.
Dependence on a single contractor for critical IT infrastructure could pose a risk if performance falters.
The broad NAICS code may obscure the specific nature of services, making detailed performance assessment more complex.

Positive Signals

Award through full and open competition suggests a competitive pricing structure.
Fixed-price contract type provides cost predictability for the agency.
Long contract duration indicates a stable, ongoing need and potential for contractor expertise development.

Sector Analysis

This contract falls within the broader Information Technology sector, specifically focusing on cloud computing services (AWS) and related computer services. The IT services market is highly dynamic, with significant spending on cloud infrastructure and support. Comparable spending benchmarks would depend on the specific AWS services utilized and the scale of operations, but federal spending on cloud services has been steadily increasing.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. This suggests that the primary award went to a large business, and the direct impact on the small business ecosystem may be limited unless New Tech Solutions, Inc. actively engages small business subcontractors.

Oversight & Accountability

Oversight would typically be managed by the contracting officer and program managers within the CDC. Transparency is facilitated by the contract award being publicly available. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to this contract.

Related Government Programs

Cloud Computing Services
IT Professional Services
AWS Infrastructure Support
Public Health IT Modernization
Centers for Disease Control and Prevention IT Contracts

Risk Flags

Potential for vendor lock-in
Cybersecurity risks associated with cloud services
Performance monitoring complexity for IT services

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $37.7 million to NEW TECH SOLUTIONS, INC.. AMAZON WEB SERVICES

Who is the contractor on this award?

The obligated recipient is NEW TECH SOLUTIONS, INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Centers for Disease Control and Prevention).

What is the total obligated amount?

The obligated amount is $37.7 million.

What is the period of performance?

Start: 2022-09-19. End: 2026-04-20.

What is the specific breakdown of services provided under this AWS contract?

The provided data indicates the NAICS code is 541519 (Other Computer Related Services) and the awardee is New Tech Solutions, Inc. for Amazon Web Services (AWS). However, the specific services are not detailed. This could range from basic cloud infrastructure provisioning (e.g., EC2, S3) to more complex managed services, data analytics platforms, or specialized application hosting. A detailed statement of work (SOW) would be required to understand the precise services, which is not available in the provided summary data. Understanding the specific services is crucial for assessing value and performance.

How does the $37.7 million contract value compare to similar AWS contracts awarded by federal agencies?

Direct comparison of the $37.7 million value is difficult without knowing the specific AWS services and duration. Federal agencies utilize AWS for a wide array of needs, from hosting websites to running complex data analytics and mission-critical applications. Contracts can range from a few million to hundreds of millions of dollars. For example, other agencies might have similar-sized contracts for cloud migration, data warehousing, or supporting large-scale research platforms. The value here seems substantial, suggesting a significant scope of work or long-term commitment for critical IT functions within HHS/CDC.

What are the key performance indicators (KPIs) for this contract, and how is performance being measured?

The provided data does not specify the Key Performance Indicators (KPIs) or the performance measurement framework for this contract. Typically, for IT services, KPIs might include uptime percentages, response times for support requests, data security compliance metrics, and successful deployment of new services. The contracting officer's representative (COR) and the agency's technical team would be responsible for monitoring performance against the contract's SOW and any defined SLAs. Without this information, a thorough assessment of contractor performance is not possible.

What is the track record of New Tech Solutions, Inc. with federal contracts, particularly those involving AWS?

The provided data identifies New Tech Solutions, Inc. as the awardee but does not offer details on their past performance or track record with federal contracts. A comprehensive analysis would require reviewing their contract history, including past performance evaluations, any past disputes or contract terminations, and their experience with similar AWS-based projects. Their ability to successfully deliver on this $37.7 million contract will depend heavily on their demonstrated capabilities and prior success in the federal IT space.

What are the potential risks associated with this contract, and what mitigation strategies are in place?

Potential risks include vendor lock-in with AWS, cybersecurity vulnerabilities, performance issues (e.g., downtime, slow support), cost overruns if not managed tightly (despite fixed price), and potential challenges in transitioning services upon contract completion. Mitigation strategies would typically involve robust security protocols, clear Service Level Agreements (SLAs), regular performance reviews, contingency planning for service disruptions, and careful contract management by the agency. The full and open competition and fixed-price nature are positive steps towards mitigating cost and ensuring a capable vendor.

How does this spending align with HHS's broader IT modernization goals or cloud adoption strategy?

This contract likely aligns with HHS's broader goals of modernizing its IT infrastructure and leveraging cloud technologies for greater efficiency, scalability, and security. Agencies like HHS are increasingly moving workloads to the cloud to support data-intensive public health initiatives, improve data sharing, and enhance analytical capabilities. The use of AWS suggests a strategic decision to utilize a leading cloud service provider to achieve these modernization objectives, potentially enabling faster deployment of new tools and services for public health.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 75D301-22-Q-75318

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4179 BUSINESS CENTER DR, FREMONT, CA, 94538

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $42,068,895

Exercised Options: $37,745,996

Current Obligation: $37,745,996

Actual Outlays: $31,787,491

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: HHSN316201500040W

IDV Type: GWAC

Timeline