HHS Awards $6.4M for NGITS On-Prem Hosting and IT Support to SEV1TECH, LLC

Contract Overview

Contract Amount: $6,430,035 ($6.4M)

Contractor: Sev1tech, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2025-09-28

End Date: 2026-05-28

Contract Duration: 242 days

Daily Burn Rate: $26.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: NGITS ON-PREM HOSTING SERVICES, AND IT SUPPORT SERVICES THAT ARE PROVIDED ACROSS HHS WITHIN THE CLOUD MANAGED APPLICATION HOSTING CENTER (C-MAHC) AND MANAGED APPLICATION HOSTING CENTER (MAHC).

Place of Performance

Location: FREDERICK, FREDERICK County, MARYLAND, 21703

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $6.4 million to SEV1TECH, LLC for work described as: NGITS ON-PREM HOSTING SERVICES, AND IT SUPPORT SERVICES THAT ARE PROVIDED ACROSS HHS WITHIN THE CLOUD MANAGED APPLICATION HOSTING CENTER (C-MAHC) AND MANAGED APPLICATION HOSTING CENTER (MAHC). Key points: 1. Contract focuses on critical IT infrastructure and support for HHS applications. 2. SEV1TECH, LLC, a single awardee, will provide services across C-MAHC and MAHC. 3. The contract is for a duration of 242 days, ending May 2026. 4. This award falls under the Computer Facilities Management Services NAICS code.

Value Assessment

Rating: fair

The contract value of $6.4M for 242 days suggests a significant per-diem cost. Benchmarking against similar cloud hosting and IT support contracts is needed to assess value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded via a BPA Call under a full and open competition. This method allows for broad market participation and competitive pricing discovery.

Taxpayer Impact: The use of full and open competition aims to ensure taxpayer funds are used efficiently by securing competitive pricing for essential IT services.

Public Impact

Ensures continuity of essential IT services for the Department of Health and Human Services. Supports the operational integrity of applications hosted within C-MAHC and MAHC. Provides critical IT support, impacting the efficiency of HHS operations and data management. The contract's duration and scope suggest a focus on maintaining existing infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if scope expands beyond initial 242-day period.
Dependence on a single vendor for critical IT infrastructure.
Limited duration may necessitate future re-competition or contract extensions.

Positive Signals

Awarded through full and open competition, indicating market research was conducted.
Firm Fixed Price contract type provides cost certainty.
Supports essential HHS functions, aligning with agency mission.

Sector Analysis

This contract falls under Computer Facilities Management Services, a sector crucial for government operations. Spending in this area is consistently high due to the reliance on robust IT infrastructure.

Small Business Impact

The data indicates this contract was not set aside for small businesses and the awardee, SEV1TECH, LLC, is not identified as a small business in this context. Further analysis would be needed to determine if small business participation was considered or achieved through subcontracting.

Oversight & Accountability

The award was made via a BPA Call, suggesting it aligns with pre-negotiated terms. Oversight will be critical to ensure performance meets contract requirements and that costs remain within the allocated budget.

Related Government Programs

Computer Facilities Management Services
Department of Health and Human Services Contracting
Office of the Assistant Secretary for Administration Programs

Risk Flags

Limited contract duration may lead to future procurement costs and potential service disruption.
Lack of small business set-aside information raises questions about broader economic impact.
Potential for vendor lock-in if services are highly specialized.
On-premise hosting may not align with modern cloud migration strategies.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $6.4 million to SEV1TECH, LLC. NGITS ON-PREM HOSTING SERVICES, AND IT SUPPORT SERVICES THAT ARE PROVIDED ACROSS HHS WITHIN THE CLOUD MANAGED APPLICATION HOSTING CENTER (C-MAHC) AND MANAGED APPLICATION HOSTING CENTER (MAHC).

Who is the contractor on this award?

The obligated recipient is SEV1TECH, LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Office of the Assistant Secretary for Administration).

What is the total obligated amount?

The obligated amount is $6.4 million.

What is the period of performance?

Start: 2025-09-28. End: 2026-05-28.

What is the specific breakdown of services included in the $6.4M for NGITS hosting and IT support, and how does this align with the agency's current IT modernization goals?

The contract covers on-prem hosting and IT support services for applications within HHS's C-MAHC and MAHC. A detailed service breakdown is necessary to assess its alignment with modernization goals. While essential for current operations, the focus on on-prem hosting might warrant scrutiny against cloud-first strategies, depending on the specific applications and HHS's long-term IT vision.

Given the firm fixed-price nature, what mechanisms are in place to manage potential scope creep or unforeseen technical challenges within the 242-day period?

Firm fixed-price contracts generally offer cost certainty, but managing scope creep requires robust contract administration. Mechanisms likely include detailed statement of work, change control processes, and regular performance reviews. The limited duration suggests a focus on maintaining existing services rather than extensive development, potentially mitigating some scope creep risks.

How does the pricing for these hosting and IT support services compare to industry benchmarks for similar government contracts, and what is the justification for the $6.4M award value?

Without specific per-unit cost data or detailed service level agreements, a direct pricing comparison is challenging. The $6.4M value for 242 days implies a substantial daily rate. A thorough justification would involve comparing this rate against historical HHS contracts, GSA schedules, or other agency awards for comparable IT infrastructure management and support services.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 12700 BLACK FOREST LN STE 306, WOODBRIDGE, VA, 22192

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $6,453,811

Exercised Options: $6,430,035

Current Obligation: $6,430,035

Actual Outlays: $2,248,500

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: HHSP233201700023B

IDV Type: BPA

Timeline