DoD's $191M IT Services Contract Awarded to Peraton Enterprise Solutions LLC Under Sole-Source Basis

Contract Overview

Contract Amount: $191,122,513 ($191.1M)

Contractor: Peraton Enterprise Solutions LLC

Awarding Agency: Department of Defense

Start Date: 2010-09-30

End Date: 2010-09-30

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: OTHER ADP & TELECOMMUNICATIONS SERVICES

Place of Performance

Location: NEW ORLEANS, ORLEANS County, LOUISIANA, 70146

State: Louisiana Government Spending

Plain-Language Summary

Department of Defense obligated $191.1 million to PERATON ENTERPRISE SOLUTIONS LLC for work described as: OTHER ADP & TELECOMMUNICATIONS SERVICES Key points: 1. Contract awarded on a sole-source basis, limiting competitive price discovery. 2. Significant IT services expenditure by the Department of the Navy. 3. Contract duration and specific performance details are not fully elaborated. 4. The 'Other Computer Related Services' NAICS code suggests a broad scope of IT support. 5. Fixed-price contract type aims to control costs, but sole-sourcing may inflate the base price. 6. Lack of competition raises questions about overall value for taxpayer funds.

Value Assessment

Rating: questionable

Benchmarking the value of this $191 million contract is challenging without detailed performance metrics and comparable sole-source awards. The firm fixed-price structure is a positive indicator for cost control, but the absence of competition suggests potential for overpayment compared to a competitively bid scenario. Further analysis would require access to the specific services rendered and their market rates.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Peraton Enterprise Solutions LLC, was solicited. This approach bypasses the competitive bidding process, which typically drives down prices and encourages innovation. The lack of competition means the government did not explore alternative solutions or pricing from other qualified vendors.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no market pressure to ensure the most competitive price. This limits the government's ability to secure the best possible value for its investment.

Public Impact

The Department of the Navy benefits from IT services provided by Peraton Enterprise Solutions LLC. The contract likely supports critical IT infrastructure and operations within the Navy. Geographic impact is not specified but likely supports Navy installations. Workforce implications would involve Peraton employees supporting Navy IT needs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Lack of transparency regarding the justification for sole-sourcing.
Scope of 'Other Computer Related Services' is broad and may lack specific performance targets.
Contract duration and specific deliverables are not detailed, hindering performance assessment.

Positive Signals

Firm fixed-price contract type provides cost certainty once awarded.
Award to an established entity (Peraton) suggests potential for reliable service delivery.

Sector Analysis

This contract falls within the broader Information Technology (IT) sector, specifically under 'Other Computer Related Services.' The IT services market is highly competitive, with numerous vendors offering a wide range of solutions. However, sole-source awards in this sector can indicate specialized needs or unique capabilities required by the agency. Comparable spending benchmarks for large-scale IT service contracts within the federal government vary widely based on scope and duration.

Small Business Impact

The data indicates that small business participation was not a stated factor in this award (ss: false, sb: false). As a sole-source award to a large prime contractor, there is a potential for limited subcontracting opportunities for small businesses unless explicitly mandated or pursued by the prime. This contract does not appear to be designed to specifically benefit the small business ecosystem.

Oversight & Accountability

Oversight mechanisms for this contract would typically involve the contracting officer's representative (COR) and the Department of the Navy's contract management division. Transparency is limited due to the sole-source nature and lack of publicly available detailed performance reports. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense IT Services
Navy IT Support Contracts
Other Computer Related Services
Sole-Source IT Procurements

Risk Flags

Sole-source award raises concerns about price competition and value for money.
Lack of detailed performance metrics hinders assessment of effectiveness.
Broad 'Other Computer Related Services' category may obscure specific service delivery and quality.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $191.1 million to PERATON ENTERPRISE SOLUTIONS LLC. OTHER ADP & TELECOMMUNICATIONS SERVICES

Who is the contractor on this award?

The obligated recipient is PERATON ENTERPRISE SOLUTIONS LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $191.1 million.

What is the period of performance?

Start: 2010-09-30. End: 2010-09-30.

What was the specific justification provided by the Department of the Navy for awarding this contract on a sole-source basis to Peraton Enterprise Solutions LLC?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source procurements are justified under circumstances such as urgent and compelling needs, unique capabilities possessed by only one source, or when competition is deemed not feasible or not in the government's best interest. A detailed justification document would normally be required by federal acquisition regulations (FAR) and would outline the rationale, market research conducted (or lack thereof), and the determination that no other responsible sources could satisfy the requirement. Without this document, it is impossible to assess the validity of the sole-source decision.

How does the $191 million contract value compare to other IT services contracts awarded by the Department of the Navy in similar periods?

Comparing this $191 million contract value requires access to a broader dataset of Navy IT services contracts awarded around the 2010-2010 timeframe. However, as a sole-source award, its value is inherently less benchmarkable against competitively procured contracts. Generally, large IT service contracts for federal agencies can range from tens of millions to billions of dollars, depending on the scope, duration, and criticality of the services. Without specific comparable contracts (e.g., for similar 'Other Computer Related Services' or broad IT support), it's difficult to definitively state if $191 million represents a high, low, or average expenditure. The sole-source nature, however, suggests it might be higher than a competitively bid equivalent.

What are the primary risks associated with awarding a large IT services contract on a sole-source basis?

The primary risks associated with sole-source IT contracts include: 1. **Higher Costs:** Lack of competition can lead to inflated pricing as the contractor faces no pressure to offer the most competitive rates. 2. **Reduced Innovation:** Without the stimulus of competition, the contractor may have less incentive to innovate or improve service delivery. 3. **Limited Vendor Pool:** The government misses out on potentially better solutions or more cost-effective alternatives offered by other qualified vendors. 4. **Potential for Lock-in:** The agency may become dependent on the sole provider, making future transitions difficult and costly. 5. **Oversight Burden:** Increased vigilance is required from the government to ensure fair pricing and adequate performance, as there's no competitive benchmark.

What specific IT services are encompassed under the NAICS code '541519 - Other Computer Related Services' for this contract?

NAICS code 541519, 'Other Computer Related Services,' is a broad category that includes establishments primarily engaged in providing on-site or remote computer hardware or software configuration services, computer disaster recovery services, and installing or integrating computer hardware or software. This can encompass a wide array of services such as IT support, help desk services, network management, system integration, cybersecurity consulting, data recovery, and IT project management. For this specific $191 million contract with the Department of the Navy, the exact services would be detailed in the contract's Statement of Work (SOW), which is not provided here. However, given the scale, it likely involves comprehensive IT support and management for a significant portion of Navy operations.

What is Peraton Enterprise Solutions LLC's track record with federal IT contracts, particularly with the Department of Defense?

Peraton Enterprise Solutions LLC (and its predecessor entities) has a significant track record of performing IT and telecommunications services for various U.S. federal agencies, including the Department of Defense (DoD). They have been involved in numerous large-scale contracts, often in areas like intelligence, defense, and civilian agency IT modernization, network infrastructure, and mission-critical systems. Their history includes both competitively won and sole-source awards. A comprehensive review of their performance would involve examining contract performance reports (CPARs), past performance evaluations, and any documented issues or successes on similar large federal contracts. Their substantial presence suggests a capacity to handle complex, high-value IT requirements.

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 › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: HP, Inc.

Address: 13600 EDS DR, HERNDON, VA, 20171

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $191,122,513

Exercised Options: $191,122,513

Current Obligation: $191,122,513

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0003910D0010

IDV Type: IDC

Timeline