HUD awards $9.58M for IT operations and maintenance to Arlluk Technology Solutions LLC

Contract Overview

Contract Amount: $9,582,397 ($9.6M)

Contractor: Arlluk Technology Solutions LLC

Awarding Agency: Department of Housing and Urban Development

Start Date: 2023-03-06

End Date: 2027-03-05

Contract Duration: 1,460 days

Daily Burn Rate: $6.6K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: LABOR HOURS

Sector: IT

Official Description: AUSS DME AND OPERATIONS AND MAINTENANCE

Place of Performance

Location: CHANTILLY, FAIRFAX County, VIRGINIA, 20151

State: Virginia Government Spending

Plain-Language Summary

Department of Housing and Urban Development obligated $9.6 million to ARLLUK TECHNOLOGY SOLUTIONS LLC for work described as: AUSS DME AND OPERATIONS AND MAINTENANCE Key points: 1. Contract value represents a significant investment in maintaining critical IT infrastructure. 2. The award was not competitively procured, raising questions about potential price efficiencies. 3. Contract duration of four years suggests a long-term need for these services. 4. The specific NAICS code indicates a focus on custom computer programming. 5. The contract is a definitive contract, implying a clear scope of work. 6. The base award amount is $6.56M, with potential for growth.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without more detailed service descriptions and performance metrics. The base award of $6.56M over four years, with a total potential of $9.58M, needs to be compared against similar IT operations and maintenance contracts within the federal government. The lack of competition suggests that the government may not have achieved the most favorable pricing, potentially leading to a higher per-unit cost than if multiple vendors had vied for the contract. Further analysis of the labor hours and specific services rendered would be necessary to definitively assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competition from other vendors. 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 limits the government's ability to leverage market forces to drive down prices and ensure the best possible value. It also raises questions about whether a more competitive process could have been employed.

Taxpayer Impact: Sole-source awards can result in higher costs for taxpayers as there is no competitive pressure to offer the lowest possible price. This can lead to a less efficient use of public funds compared to competitively awarded contracts.

Public Impact

The Department of Housing and Urban Development (HUD) benefits from the continuity of its IT operations and maintenance. Essential IT services, including custom computer programming, are delivered to support HUD's mission. The contract's impact is primarily within the federal agency, ensuring internal operational stability. The workforce implications are tied to the specific IT roles and expertise required for these services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to suboptimal pricing.
Limited transparency into the justification for sole-source award.
Potential for cost overruns if scope is not tightly managed.

Positive Signals

Award to a specific LLC suggests a targeted approach to service delivery.
Definitive contract structure provides clarity on the agreement.
Long-term duration indicates a stable, ongoing need for services.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on custom computer programming services and IT operations and maintenance. The federal IT market is vast, with significant spending allocated to maintaining and upgrading existing systems, as well as developing new technological solutions. Contracts like this are crucial for ensuring the seamless functioning of government agencies. Benchmarking would involve comparing the contract's value and scope to other federal IT support contracts, particularly those for operations and maintenance.

Small Business Impact

The data indicates that this contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting requirements for small businesses mentioned. Therefore, the direct impact on the small business ecosystem is likely minimal unless Arlluk Technology Solutions LLC voluntarily engages small businesses for subcontracting. Further investigation into the company's subcontracting practices would be needed to fully assess its impact on small businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program officials within the Department of Housing and Urban Development. Accountability measures would be defined within the contract's terms and conditions, including performance standards and reporting requirements. Transparency is limited due to the sole-source nature of the award, but contract details should be publicly available through federal procurement databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Federal IT Operations and Maintenance Contracts
Custom Computer Programming Services Contracts
Department of Housing and Urban Development IT Spending

Risk Flags

Sole-source award lacks competitive pricing pressure.
Limited public information on specific performance metrics.
Potential for cost growth requires close monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $9.6 million to ARLLUK TECHNOLOGY SOLUTIONS LLC. AUSS DME AND OPERATIONS AND MAINTENANCE

Who is the contractor on this award?

The obligated recipient is ARLLUK TECHNOLOGY SOLUTIONS LLC.

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 $9.6 million.

What is the period of performance?

Start: 2023-03-06. End: 2027-03-05.

What is the specific justification for awarding this contract on a sole-source basis?

The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or urgent requirements that only a single vendor can meet. For this contract, the specific reason for the sole-source designation by the Department of Housing and Urban Development (HUD) would need to be detailed in a Justification for Other Than Full and Open Competition (JOFOC) document. Without access to this specific JOFOC, it's impossible to definitively state the reason. However, common justifications include situations where the contractor possesses unique intellectual property, has a proven track record with a specific legacy system that no other vendor can support, or if there's an urgent and compelling need that precludes a competitive process. The lack of competition inherently limits the government's ability to explore alternative solutions or pricing structures.

How does the awarded amount compare to similar IT operations and maintenance contracts within HUD or other federal agencies?

Comparing this $9.58 million contract for IT operations and maintenance to similar contracts requires access to a broader dataset of federal procurements. However, generally, IT operations and maintenance contracts can vary significantly in cost based on the scope of services, the complexity of the systems supported, the duration of the contract, and the specific technologies involved. A contract of this size, spanning four years, suggests a substantial scope of work. Without specific benchmarks for comparable HUD or agency-wide IT O&M contracts, it's difficult to definitively state if this represents a high, low, or average cost. Factors like the number of users supported, the criticality of the systems, and the level of support (e.g., 24/7 vs. business hours) heavily influence pricing. The sole-source nature of this award also raises a flag that the price might not be as competitive as it could be in a fully open market.

What are the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract?

Key Performance Indicators (KPIs) and Service Level Agreements (SLAs) are critical components of any IT operations and maintenance contract, defining the expected performance standards and quality of service. For this contract with Arlluk Technology Solutions LLC, specific KPIs and SLAs would be detailed within the contract's Statement of Work (SOW) or Performance Work Statement (PWS). These typically include metrics related to system uptime, response times for issue resolution, security compliance, data backup and recovery success rates, and the efficiency of custom programming tasks. The Department of Housing and Urban Development (HUD) would use these metrics to monitor contractor performance and ensure that the IT services are meeting the agency's operational needs. The absence of publicly detailed KPIs makes it challenging to assess the contractor's performance objectively.

What is Arlluk Technology Solutions LLC's track record with federal IT contracts, particularly those involving operations and maintenance?

Arlluk Technology Solutions LLC's track record with federal IT contracts, especially in operations and maintenance, is a crucial factor in assessing the risk and potential success of this award. A review of federal procurement databases would reveal their past performance, including the types of contracts awarded, their values, the agencies they've served, and any performance evaluations or past performance questionnaires. A history of successful contract completion, adherence to schedules, and positive client feedback would indicate a lower risk. Conversely, a history of contract disputes, performance issues, or significant cost overruns would raise concerns. Given this is a sole-source award, HUD likely relied on prior positive experiences or specific expertise demonstrated by Arlluk Technology Solutions LLC to justify the award.

What is the potential for cost growth beyond the base award amount of $6.56M?

The contract has a base award of $6.56 million and a total potential value of $9.58 million, indicating a potential for cost growth of approximately $3.02 million. This growth is likely tied to contract options, task orders, or undefined quantities (if applicable) that allow for increased scope or effort over the contract's four-year duration. The specific mechanisms for this growth would be outlined in the contract's terms and conditions. Factors such as increased demand for services, unforeseen technical challenges, or the addition of new functionalities could drive the utilization of the full contract value. Careful management and oversight by HUD are essential to ensure that any cost growth is justified, necessary, and represents good value for money.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 86615623R00005

Offers Received: 1

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 3800 CENTERPOINT DR, ANCHORAGE, AK, 99503

Business Categories: 8(a) Program Participant, Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $11,252,306

Exercised Options: $10,314,908

Current Obligation: $9,582,397

Actual Outlays: $5,587,103

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline