HHS awards $7.6M IT services contract to DLH, LLC, with 280 days duration

Contract Overview

Contract Amount: $7,587,356 ($7.6M)

Contractor: DLH, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2025-08-01

End Date: 2026-05-08

Contract Duration: 280 days

Daily Burn Rate: $27.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: OFFICE OF INFORMATION TECHNOLOGY (OIT) CIO-SP3 IT SERVICE

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20817

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $7.6 million to DLH, LLC for work described as: OFFICE OF INFORMATION TECHNOLOGY (OIT) CIO-SP3 IT SERVICE Key points: 1. Contract value appears reasonable for IT services, but detailed benchmarking is needed. 2. Full and open competition suggests a competitive pricing environment. 3. Contract duration is relatively short, potentially impacting long-term stability. 4. Performance context is limited without specific deliverables or performance metrics. 5. Sector positioning is within IT services, a common area for federal spending. 6. The contract type (Firm Fixed Price) shifts risk to the contractor.

Value Assessment

Rating: fair

The contract value of $7.6 million over approximately 280 days for IT services is within a typical range for such procurements. However, without specific details on the scope of work, it's difficult to definitively benchmark the value. Comparing it to similar IT service contracts awarded by NIH or other agencies for comparable services would provide a clearer picture of whether the pricing is competitive. The firm fixed-price nature suggests that the contractor bears the risk of cost overruns, which can be a positive indicator of value if the price is set appropriately.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating a broad solicitation process. The presence of 8 bidders suggests a healthy level of competition for this IT service requirement. A competitive bidding process generally leads to better price discovery and can result in more favorable terms for the government.

Taxpayer Impact: The robust competition for this contract is beneficial for taxpayers, as it likely drove down prices and encouraged multiple vendors to offer their best solutions, leading to a more cost-effective outcome.

Public Impact

The Office of Information Technology (OIT) at HHS is the primary beneficiary, receiving essential IT services. The contract supports the delivery of computer systems design services. The geographic impact is centered in Maryland, where the contractor is located. The contract may have implications for the IT workforce, potentially creating or sustaining jobs within DLH, LLC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed performance metrics makes it difficult to assess contractor performance.
The relatively short contract duration might lead to frequent re-competition and potential disruption.
Specific IT services required are not detailed, making it hard to gauge the complexity and risk.

Positive Signals

Firm Fixed Price contract type transfers cost overrun risk to the contractor.
Full and open competition with 8 bidders indicates a competitive market.
The contract is awarded to DLH, LLC, a known entity in government contracting.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on computer systems design services. The federal IT services market is substantial, with agencies consistently investing in technology to support their missions. Comparable spending benchmarks for IT services vary widely based on scope, complexity, and duration. This contract's value of approximately $7.6 million over less than a year is moderate within the broader federal IT landscape.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses arising from a set-aside provision. The competition was full and open, meaning large and small businesses could participate, but the primary award went to DLH, LLC. Further analysis would be needed to determine if DLH, LLC has its own small business subcontracting plan.

Oversight & Accountability

Oversight for this contract would primarily reside with the National Institutes of Health (NIH) contracting officers and program managers within the Department of Health and Human Services (HHS). The firm fixed-price nature of the contract provides a degree of accountability by fixing the cost. Transparency is facilitated by the public nature of federal contract awards, though specific performance details and internal oversight processes are not publicly detailed. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

CIO-SP3
IT Services
Computer Systems Design Services
HHS IT Contracts
NIH IT Procurement

Risk Flags

Potential for scope creep due to unspecified service details.
Short contract duration may impact thoroughness of service delivery.
Lack of explicit performance metrics requires careful monitoring by the agency.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $7.6 million to DLH, LLC. OFFICE OF INFORMATION TECHNOLOGY (OIT) CIO-SP3 IT SERVICE

Who is the contractor on this award?

The obligated recipient is DLH, LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $7.6 million.

What is the period of performance?

Start: 2025-08-01. End: 2026-05-08.

What is the specific scope of IT services being procured under this contract?

The contract, identified by NAICS code 541512, is for 'Computer Systems Design Services.' However, the specific scope of work is not detailed in the provided data. This typically encompasses services such as designing, developing, and implementing IT systems, including hardware, software, and network infrastructure. It can also include IT consulting, systems integration, and IT project management. Without a detailed Statement of Work (SOW), it is difficult to ascertain the precise nature of the services, their complexity, and the specific technologies involved. Further review of the contract documentation would be necessary to understand the full scope.

How does the awarded price compare to similar IT service contracts at NIH?

Benchmarking this $7.6 million contract against similar IT service contracts at NIH requires access to a broader dataset of comparable procurements. Factors such as contract duration (280 days), specific services (Computer Systems Design), and the level of technical expertise required significantly influence pricing. Given the firm fixed-price structure and the competitive bidding process involving 8 bidders, the price is likely within a reasonable market range. However, a detailed comparison with contracts for similar services, duration, and complexity awarded by NIH or other agencies would be needed to confirm if this represents excellent, good, or fair value for money.

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

The provided data does not include specific Key Performance Indicators (KPIs) or details on how contractor performance will be measured. For a contract of this nature, typical KPIs might include system uptime, response times for technical support, successful project completion rates, adherence to security protocols, and user satisfaction. Performance monitoring is usually conducted by the Contracting Officer's Representative (COR) or a designated program manager. The firm fixed-price contract implies that meeting the defined deliverables and performance standards is crucial for the contractor to receive full payment, but the exact metrics are not specified here.

What is DLH, LLC's track record with federal IT service contracts, particularly with HHS?

DLH, LLC is a known entity in the federal contracting space, with a history of providing various services, including IT and healthcare support, to government agencies. While the provided data confirms they were awarded this specific contract, a comprehensive assessment of their track record would involve reviewing their past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), the types and values of previous contracts, and their success rate in similar IT service procurements. Their experience with HHS and NIH specifically would be a relevant factor in evaluating their capability to execute this contract successfully.

What is the potential impact of the 'Exclusion of Sources' clause in the competition type?

The competition type is listed as 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This phrasing can be confusing. Typically, 'Full and Open Competition' means all responsible sources are permitted to compete. The 'after exclusion of sources' part suggests that while the initial solicitation was broad, certain sources might have been excluded based on specific criteria (e.g., security clearances, specific certifications, or prior performance issues) before the final award decision. However, the fact that 8 bidders participated indicates that the exclusion did not unduly limit competition significantly. The intent is usually to ensure that only qualified and appropriate sources are considered, without unnecessarily restricting the pool.

Are there any identified risks associated with this contract, such as technical challenges or contractor performance issues?

Based solely on the provided summary data, specific risks are not explicitly detailed. However, general risks associated with IT service contracts include potential technical challenges in system design and implementation, integration issues with existing infrastructure, cybersecurity threats, and the possibility of scope creep if requirements are not clearly defined. The short duration (280 days) could also pose a risk if the project is complex, potentially leading to rushed work or incomplete deliverables. Contractor performance risk is mitigated by the competitive bidding process and the firm fixed-price structure, but past performance would need to be reviewed for a more thorough assessment.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: C-120674-SB

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: DLH Holdings Corp

Address: 6720B ROCKLEDGE DR STE 777, BETHESDA, MD, 20817

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $46,904,120

Exercised Options: $7,587,356

Current Obligation: $7,587,356

Actual Outlays: $736,420

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSN316201200145W

IDV Type: GWAC

Timeline