HUD's $23.7M Computer Systems Design contract awarded to Reverse Market Insight, Inc. without competition

Contract Overview

Contract Amount: $23,694,293 ($23.7M)

Contractor: Reverse Market Insight, Inc.

Awarding Agency: Department of Housing and Urban Development

Start Date: 2024-09-30

End Date: 2026-09-29

Contract Duration: 729 days

Daily Burn Rate: $32.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: HOME EQUITY CONVERSION MORTGAGE (HECM)

Place of Performance

Location: DANA POINT, ORANGE County, CALIFORNIA, 92629

State: California Government Spending

Plain-Language Summary

Department of Housing and Urban Development obligated $23.7 million to REVERSE MARKET INSIGHT, INC. for work described as: HOME EQUITY CONVERSION MORTGAGE (HECM) Key points: 1. Contract awarded on a sole-source basis, limiting potential cost savings from competitive bidding. 2. The contract duration of 729 days suggests a need for sustained IT support. 3. Fixed-price contract type may offer cost certainty but could limit flexibility. 4. The specific NAICS code (541512) indicates a focus on computer systems design. 5. Awarded by the Department of Housing and Urban Development, aligning with its mission. 6. The contract value is substantial, requiring careful oversight to ensure value for money.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature. Without competitive bids, it's difficult to assess if the pricing is aligned with market rates for similar computer systems design services. The fixed-price structure provides some cost predictability, but the absence of competition raises concerns about whether the government secured the best possible price. Further analysis would require access to detailed cost breakdowns and comparisons with other sole-source awards for comparable services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not openly competed. This approach is typically used when only one vendor can provide the required services, often due to proprietary technology, unique expertise, or urgent needs. The lack of competition means there were no other bidders to drive down prices through a bidding process, potentially leading to higher costs for the government compared to a competed contract. The justification for this sole-source award would need to be thoroughly reviewed to ensure it was appropriate.

Taxpayer Impact: Taxpayers may be paying a premium for these services due to the absence of competitive pressure. Without multiple bids, there's less assurance that the price reflects the most cost-effective solution available in the market.

Public Impact

The primary beneficiary is the Department of Housing and Urban Development, which will receive computer systems design services. These services are crucial for maintaining and potentially upgrading HUD's IT infrastructure. The contract supports the operational efficiency of a key federal agency responsible for housing policy. The geographic impact is primarily within California, where the contractor is located, but the services support a national agency.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potential cost savings.
Lack of competition raises concerns about whether the government received the best value.
Fixed-price contract may not be optimal if significant scope changes are anticipated.

Positive Signals

Contract awarded to a single, presumably qualified, vendor.
Fixed-price contract offers cost certainty for the duration of the award.
Contract duration suggests a stable, ongoing need for these services.

Sector Analysis

This contract falls within the Computer Systems Design Services sector, a critical component of the IT industry. This sector encompasses a wide range of services, including designing and developing custom software, integrating hardware and software, and providing IT consulting. The market for these services is competitive, with numerous firms offering specialized expertise. However, specific niche capabilities or existing relationships can sometimes lead to sole-source awards. Benchmarking would typically involve comparing pricing for similar system design projects within the federal government and the private sector.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. The award to Reverse Market Insight, Inc., a single entity, does not directly benefit the small business ecosystem through set-asides or mandated subcontracting. Further investigation would be needed to determine if the prime contractor has any internal small business utilization goals or programs.

Oversight & Accountability

Oversight for this contract will be managed by the Department of Housing and Urban Development. Accountability measures will be tied to the performance requirements outlined in the contract and the fixed-price terms. Transparency regarding the justification for the sole-source award and the specific deliverables will be key to assessing oversight effectiveness. The Inspector General for HUD would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Federal IT Services Contracts
Computer Systems Design Services
Department of Housing and Urban Development IT Procurement

Risk Flags

Sole-source award without justification
Potential for overpricing due to lack of competition
Contractor performance history unknown
Scope creep risk on fixed-price contract

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $23.7 million to REVERSE MARKET INSIGHT, INC.. HOME EQUITY CONVERSION MORTGAGE (HECM)

Who is the contractor on this award?

The obligated recipient is REVERSE MARKET INSIGHT, INC..

Which agency awarded this contract?

Awarding agency: Department of Housing and Urban Development (Department of Housing and Urban Development).

What is the total obligated amount?

The obligated amount is $23.7 million.

What is the period of performance?

Start: 2024-09-30. End: 2026-09-29.

What is the track record of Reverse Market Insight, Inc. with federal contracts, particularly with HUD?

A review of federal procurement data indicates that Reverse Market Insight, Inc. has received federal contracts, though the extent of their work and specific performance history would require a deeper dive into contract databases and performance reports. Understanding their past performance, especially with HUD or similar agencies, is crucial for assessing the risk associated with this sole-source award. A positive track record with successful delivery of similar services would mitigate some concerns, while a history of issues could heighten them. Without specific past performance data readily available, it's difficult to definitively assess their reliability for this $23.7 million contract.

How does the $23.7 million contract value compare to similar computer systems design services procured by HUD or other agencies?

Comparing the $23.7 million contract value requires context regarding the scope and duration of services. As a sole-source award, direct price comparisons are inherently difficult. However, if similar computer systems design projects, even those competed, have been awarded for significantly lower amounts or with more extensive deliverables for a comparable price, it would suggest this contract may not represent optimal value. Benchmarking against industry standards for system design and integration projects of similar complexity and scale, considering the fixed-price nature, is essential. The absence of competition makes it harder to ascertain if this price is market-driven.

What are the specific risks associated with awarding a contract of this magnitude on a sole-source basis?

The primary risk of a sole-source award for a $23.7 million contract is the potential for inflated pricing due to the lack of competitive pressure. Without multiple bidders vying for the contract, the government may not achieve the most cost-effective outcome. Another risk is the potential for vendor lock-in, where the agency becomes overly reliant on a single provider, making future transitions or renegotiations more difficult. Furthermore, if the sole-source justification is weak or if the contractor fails to perform, the agency has limited immediate alternatives. Ensuring robust oversight and clear performance metrics becomes even more critical in sole-source situations.

What is the expected program effectiveness or outcome of these computer systems design services for HUD?

The expected outcome of these computer systems design services is to enhance or maintain the operational capabilities of HUD's IT infrastructure. This could involve developing new software applications, integrating existing systems, improving network performance, or providing strategic IT consulting. The effectiveness will depend on the clarity of the requirements, the contractor's ability to meet those requirements, and HUD's own internal capacity to manage the project and adopt the delivered solutions. Successful implementation should lead to improved efficiency, better data management, or enhanced service delivery by HUD. The fixed-price nature suggests a defined scope, aiming for predictable results.

How does this contract's value and nature compare to historical spending patterns for computer systems design services at HUD?

Analyzing historical spending patterns for computer systems design services at HUD is crucial for context. If HUD has historically awarded similar sole-source contracts of this value, it might indicate a pattern of reliance on specific vendors or a particular procurement strategy. Conversely, if most of HUD's IT services are competitively procured and this sole-source award is an outlier, it warrants closer scrutiny. Understanding the trend of spending in this category, the average contract values, and the mix of competed versus sole-source awards over time would help determine if this contract aligns with or deviates from established patterns, providing insight into its potential value and risk.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 86615324Q00025

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Reverse Market Insight Inc.

Address: 34232 PACIFIC COAST HWY, DANA POINT, CA, 92629

Business Categories: 8(a) Program Participant, Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $27,259,683

Exercised Options: $26,564,593

Current Obligation: $23,694,293

Actual Outlays: $17,514,048

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline