HHS awards $9.3M for ServiceNow licenses to Carahsoft, ending Feb 2027

Contract Overview

Contract Amount: $9,317,595 ($9.3M)

Contractor: Carahsoft Technology Corp

Awarding Agency: Department of Health and Human Services

Start Date: 2025-03-01

End Date: 2027-02-28

Contract Duration: 729 days

Daily Burn Rate: $12.8K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SERVICENOW LICENSE SUBSCRIPTION

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $9.3 million to CARAHSOFT TECHNOLOGY CORP for work described as: SERVICENOW LICENSE SUBSCRIPTION Key points: 1. Significant investment in IT infrastructure for administrative functions. 2. Carahsoft Technology Corp is a key reseller in the federal IT market. 3. Potential risk of vendor lock-in with subscription-based software. 4. Spending falls within the Software Publishers sector.

Value Assessment

Rating: good

The contract value of $9.3M over two years appears reasonable for enterprise-level software licenses. Benchmarking against similar large-scale software subscriptions would provide a more definitive assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition via a BPA Call, indicating a competitive process. This method generally promotes price discovery and ensures fair market value.

Taxpayer Impact: Taxpayer funds are being used for essential IT services, with competition aiming to optimize value for money.

Public Impact

Ensures continued access to critical IT tools for HHS administrative operations. Supports the functioning of the Office of the Assistant Secretary for Administration. Potential for improved workflow and data management through ServiceNow platform.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Subscription model may lead to escalating costs over time.
Reliance on a single vendor for critical software.

Positive Signals

Awarded under full and open competition.
Supports essential government operations.

Sector Analysis

This contract falls within the IT sector, specifically software licensing. Federal spending on software publishers (NAICS 511210) is substantial, with agencies relying on these tools for operational efficiency.

Small Business Impact

The awardee, Carahsoft Technology Corp, is a large reseller. Analysis of subcontracting opportunities for small businesses was not detailed in the provided data.

Oversight & Accountability

The use of a BPA Call suggests established procurement vehicles are being leveraged. Oversight would focus on usage, performance, and adherence to contract terms.

Related Government Programs

Software Publishers
Department of Health and Human Services Contracting
Office of the Assistant Secretary for Administration Programs

Risk Flags

Potential for cost escalation with subscription renewals.
Vendor lock-in risk.
Dependence on a single software provider.
Need for ongoing performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $9.3 million to CARAHSOFT TECHNOLOGY CORP. SERVICENOW LICENSE SUBSCRIPTION

Who is the contractor on this award?

The obligated recipient is CARAHSOFT TECHNOLOGY CORP.

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 $9.3 million.

What is the period of performance?

Start: 2025-03-01. End: 2027-02-28.

What is the total cost of ownership for ServiceNow over the contract period, including potential future renewals and support?

The total cost of ownership over the initial 2-year period is $9.3M. However, a comprehensive analysis would require projecting costs for subsequent renewal periods, factoring in potential price increases, additional module subscriptions, and any associated implementation or training expenses. Understanding the long-term financial commitment is crucial for budget planning.

How does the per-user cost compare to industry benchmarks for similar enterprise software solutions?

Without specific per-user counts or detailed feature sets, a direct per-unit cost benchmark is difficult. However, $9.3M for a 2-year subscription for a large agency like HHS suggests a significant user base. Comparing this to publicly available pricing for comparable enterprise resource planning or IT service management software from competitors would reveal if the pricing is competitive.

What measures are in place to ensure the continued effectiveness and security of the ServiceNow platform throughout the contract duration?

The contract likely includes service level agreements (SLAs) and security requirements mandated by HHS. Ongoing oversight by the contracting officer and technical points of contact would monitor performance and compliance. Regular security audits and adherence to federal data protection regulations are critical for maintaining platform effectiveness and safeguarding sensitive information.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11493 SUNSET HILLS RD, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $22,005,815

Exercised Options: $9,317,595

Current Obligation: $9,317,595

Actual Outlays: $2,124,274

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 47QTCA22A0008

IDV Type: BPA

Timeline