HHS awards $10.7M for Microsoft Enterprise Agreement to New Tech Solutions, Inc

Contract Overview

Contract Amount: $10,734,787 ($10.7M)

Contractor: NEW Tech Solutions, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2023-11-01

End Date: 2026-10-31

Contract Duration: 1,095 days

Daily Burn Rate: $9.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: OIT- MAINT28 C 5635 MICROSOFT ENTERPRISE AGREEMENT

Place of Performance

Location: FREMONT, ALAMEDA County, CALIFORNIA, 94538

State: California Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $10.7 million to NEW TECH SOLUTIONS, INC. for work described as: OIT- MAINT28 C 5635 MICROSOFT ENTERPRISE AGREEMENT Key points: 1. Contract value represents a significant investment in enterprise software licensing and support. 2. Competition dynamics for this contract are crucial for ensuring fair pricing and value. 3. Performance risk is moderate, given the reliance on established software and a known vendor. 4. This agreement supports essential IT infrastructure for the Health Resources and Services Administration. 5. The contract falls within the 'Other Computer Related Services' NAICS code, indicating a broad service category.

Value Assessment

Rating: good

The contract value of $10.7 million over three years for a Microsoft Enterprise Agreement appears reasonable when benchmarked against similar large-scale software licensing agreements. While specific per-unit cost comparisons are difficult without detailed software SKUs and user counts, the overall price point is within expected ranges for federal agencies of this size. The firm-fixed-price structure provides cost certainty, though it limits flexibility if needs change significantly. Further analysis would require comparing the specific Microsoft products and support levels to other federal agreements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of a single award (no. 1) suggests that New Tech Solutions, Inc. was selected as the most advantageous offer. The level of competition, while broad in its initial solicitation, ultimately resulted in one prime contractor. This process is designed to foster price discovery and ensure the government receives competitive pricing.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down costs through a competitive bidding process, ensuring that the selected vendor offers the best value for the government's investment.

Public Impact

The primary beneficiaries are the employees and operations of the Health Resources and Services Administration (HRSA), who will utilize the licensed Microsoft software and support. The services delivered include access to and support for Microsoft enterprise software, crucial for daily operations, data management, and communication. The geographic impact is primarily within California, where the contractor is located, but the services support a federal agency with national reach. Workforce implications include ensuring HRSA staff have the necessary tools to perform their duties effectively, potentially impacting productivity and efficiency.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with enterprise software agreements, making future transitions costly.
Reliance on a single vendor for critical software infrastructure could pose risks if the vendor's product roadmap or support changes unfavorably.

Positive Signals

Firm-fixed-price contract provides budget certainty for the agency.
Awarded under full and open competition, suggesting a competitive process was followed.
Contract duration of three years allows for stable IT planning and resource allocation.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on software licensing and support for enterprise-level solutions. The market for enterprise software agreements, particularly for major vendors like Microsoft, is substantial within the federal government. Agencies often consolidate their software needs through such agreements to achieve economies of scale and streamline procurement. Comparable spending benchmarks would involve looking at other large federal Microsoft Enterprise Agreements across various agencies.

Small Business Impact

The contract was awarded to NEW TECH SOLUTIONS, INC., and there is no indication of a small business set-aside (ss: false) or that this contract specifically targets small business subcontracting (sb: false). Therefore, the direct impact on the small business ecosystem through this specific award is likely minimal, with the primary focus being on the prime contractor's ability to fulfill the enterprise agreement requirements.

Oversight & Accountability

Oversight for this contract would primarily reside with the Health Resources and Services Administration (HRSA) contracting officers and program managers. Accountability is established through the firm-fixed-price terms, requiring delivery of specified software and support. Transparency is facilitated by the contract award being publicly available through federal procurement databases. There is no specific mention of an Inspector General jurisdiction for this particular contract, but the HHS OIG would have overarching authority for fraud, waste, and abuse within the department.

Related Government Programs

Microsoft Enterprise Agreements
Federal IT Software Procurement
Cloud Services Contracts
IT Infrastructure Support
Enterprise Resource Planning (ERP) Systems

Risk Flags

Potential for cost overruns if license usage is not managed effectively.
Risk of vendor lock-in with enterprise software solutions.
Dependence on a single vendor for critical IT infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $10.7 million to NEW TECH SOLUTIONS, INC.. OIT- MAINT28 C 5635 MICROSOFT ENTERPRISE AGREEMENT

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 (Health Resources and Services Administration).

What is the total obligated amount?

The obligated amount is $10.7 million.

What is the period of performance?

Start: 2023-11-01. End: 2026-10-31.

What is the track record of NEW TECH SOLUTIONS, INC. in fulfilling federal IT contracts, particularly those involving large enterprise software agreements?

A review of federal procurement data indicates that NEW TECH SOLUTIONS, INC. has a history of receiving federal contracts. However, the extent of their experience with large, multi-year Microsoft Enterprise Agreements specifically requires deeper analysis. While they are listed as the prime contractor for this $10.7 million award, understanding their past performance on similar scale and complexity contracts is crucial. This would involve examining contract vehicles, past performance evaluations, and any reported issues or successes on previous federal engagements. Without more granular data on their specific experience with enterprise software, it's difficult to definitively assess their track record in this niche.

How does the awarded price of $10.7 million for this Microsoft Enterprise Agreement compare to similar agreements awarded by other federal agencies?

Benchmarking this $10.7 million contract requires comparing it against other federal Microsoft Enterprise Agreements (MEAs) of similar scope and duration. Factors such as the specific Microsoft products licensed (e.g., Office 365, Windows, server licenses), the number of users or devices covered, and the level of support included are critical for a fair comparison. Generally, MEAs are negotiated to achieve volume discounts. If this agreement covers a substantial number of users within HRSA and includes a comprehensive suite of products, the price may be competitive. However, without access to the detailed breakdown of software and user counts, a precise comparison is challenging. Agencies often leverage GSA schedules or specific GWACs for software procurement, and comparing pricing across these different vehicles can also provide context.

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

The primary risks associated with this Microsoft Enterprise Agreement include potential vendor lock-in, where HRSA becomes heavily reliant on Microsoft products and services, making future transitions to alternative solutions costly and complex. Another risk is the possibility of scope creep or unmanaged license usage, which could lead to costs exceeding the initial budget if not carefully monitored. Furthermore, the reliance on a single vendor for critical IT infrastructure introduces a risk related to the vendor's product lifecycle, support changes, or security vulnerabilities. Mitigation strategies likely involve robust contract management by HRSA, including regular license utilization reviews, adherence to the firm-fixed-price terms, and proactive engagement with New Tech Solutions, Inc. to ensure alignment with HRSA's evolving IT needs and security protocols.

How effective is the firm-fixed-price (FFP) contract type in ensuring value for money for this Microsoft Enterprise Agreement?

The firm-fixed-price (FFP) contract type is generally effective in ensuring value for money when the scope of work is well-defined and unlikely to change significantly. For a Microsoft Enterprise Agreement, which typically involves licensing a standard suite of software products for a set period, FFP provides budget certainty for HRSA. This means the government knows the total cost upfront, reducing the risk of cost overruns. It incentivizes the contractor, New Tech Solutions, Inc., to manage their costs efficiently to maintain profitability. However, FFP can be less advantageous if HRSA's needs change substantially during the contract period, as modifications might be costly or require a new contract. For standard software licensing, FFP is a suitable choice for cost control and predictability.

What are the historical spending patterns for Microsoft Enterprise Agreements within the Department of Health and Human Services (HHS) or its sub-agencies like HRSA?

Historical spending patterns for Microsoft Enterprise Agreements within HHS and its sub-agencies like HRSA typically show a consistent need for Microsoft software and services due to their widespread use across government IT infrastructures. Agencies often renew or re-compete these agreements every few years to leverage volume discounts and updated software versions. Analyzing past spending would involve looking at the total value of previous MEAs, the duration of those contracts, and the specific Microsoft products included. Trends might indicate an increasing reliance on cloud-based Microsoft services (like Office 365) over traditional on-premises licenses, potentially affecting the overall cost structure and service delivery models. Understanding these patterns helps in evaluating the current $10.7 million award in a broader financial context.

Industry Classification

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

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 75R60224Q00009

Offers Received: 1

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: $13,774,099

Exercised Options: $13,761,424

Current Obligation: $10,734,787

Actual Outlays: $10,734,787

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: HHSN316201500040W

IDV Type: GWAC

Timeline