Education Department awards $14.9M contract for custom computer programming services to Applied Enterprise Management Corporation

Contract Overview

Contract Amount: $14,944,602 ($14.9M)

Contractor: Applied Enterprise Management Corporation

Awarding Agency: Department of Education

Start Date: 2023-04-24

End Date: 2028-04-23

Contract Duration: 1,826 days

Daily Burn Rate: $8.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: ERIC

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20002

State: District of Columbia Government Spending

Plain-Language Summary

Department of Education obligated $14.9 million to APPLIED ENTERPRISE MANAGEMENT CORPORATION for work described as: ERIC Key points: 1. Contract value represents a significant investment in IT services for the Department of Education. 2. The contract was awarded through full and open competition, suggesting a competitive bidding process. 3. The fixed-price nature of the contract aims to control costs and provide budget certainty. 4. The duration of the contract (5 years) indicates a long-term need for these services. 5. The specific NAICS code (541511) points to a focus on custom software development. 6. The award to a single contractor suggests a specialized need or a highly competitive initial bid.

Value Assessment

Rating: good

The contract value of $14.9 million over five years averages to approximately $3 million annually. Benchmarking this against similar custom computer programming services contracts within the federal government is challenging without more specific service details. However, the firm fixed-price structure suggests that the government has negotiated a set price for the defined scope of work, which is generally a positive indicator for value. The number of bids received (2) is on the lower side for a full and open competition, which could imply either a niche market or that the initial bids were not competitive enough to attract more participants.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. Despite this, only two bids were received. This limited number of bidders could indicate a specialized service requirement that fewer companies can fulfill, or it might suggest that the initial solicitation did not attract a wider range of interest. The presence of two bidders does allow for some price comparison, but a higher number of bidders typically leads to more robust price discovery and potentially lower prices for the government.

Taxpayer Impact: While two bidders offer some level of competition, taxpayers may not be realizing the full benefit of a more robustly competed contract. A higher number of bids could have driven the price down further, leading to greater savings.

Public Impact

The primary beneficiary is the Department of Education, which will receive custom computer programming services to support its operations. These services are expected to enhance or develop software solutions critical for the department's mission. The contract's impact is primarily within the District of Columbia, where the Department of Education is headquartered. The contract supports jobs within the IT services sector, specifically in custom software development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (2 bidders) may have resulted in a higher price than if more vendors had participated.
The specific nature of 'custom computer programming' can lead to scope creep if not managed tightly, potentially increasing costs beyond the initial contract value.

Positive Signals

The firm fixed-price contract type provides cost certainty for the government.
Awarding through full and open competition ensures that the government sought the best possible solution from the market.
The 5-year duration suggests a stable, long-term partnership for critical IT needs.

Sector Analysis

The federal IT services market is vast and highly competitive, with custom computer programming being a significant segment. This contract falls under the Information Technology sector, specifically focusing on software development. The Department of Education, like many federal agencies, relies heavily on specialized IT solutions to manage its complex data, programs, and services. The annual value of approximately $3 million is moderate within the context of large federal IT procurements, but significant for the specific services rendered.

Small Business Impact

This contract does not appear to have a small business set-aside, as indicated by 'sb: false'. Furthermore, the contractor, Applied Enterprise Management Corporation, is not explicitly identified as a small business. This suggests that the contract was not specifically targeted to encourage small business participation. There is no information provided regarding subcontracting plans, so the direct impact on the small business ecosystem is unclear, but it is unlikely to be a primary driver for this particular award.

Oversight & Accountability

The contract is a definitive contract awarded by the Department of Education, implying it has undergone standard procurement review processes. Oversight will likely be managed by the contracting officer and program managers within the Department of Education. Transparency is facilitated by public contract databases where award details are posted. The specific Inspector General for the Department of Education would have jurisdiction over any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Federal IT Services
Custom Software Development
Department of Education IT Modernization
IT Professional Services

Risk Flags

Limited Competition
Potential for Scope Creep
Contract Duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Education awarded $14.9 million to APPLIED ENTERPRISE MANAGEMENT CORPORATION. ERIC

Who is the contractor on this award?

The obligated recipient is APPLIED ENTERPRISE MANAGEMENT CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Education (Department of Education).

What is the total obligated amount?

The obligated amount is $14.9 million.

What is the period of performance?

Start: 2023-04-24. End: 2028-04-23.

What is the track record of Applied Enterprise Management Corporation with federal contracts?

Information regarding Applied Enterprise Management Corporation's specific track record with federal contracts is not detailed in the provided data snippet. A comprehensive analysis would require examining the contractor's past performance on similar federal awards, including their history of meeting deadlines, staying within budget, and overall client satisfaction. Reviewing data from sources like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS) would be necessary to evaluate their reliability and expertise in delivering custom computer programming services.

How does the $14.9 million contract value compare to similar custom programming contracts?

The $14.9 million contract value over five years, averaging $3 million annually, is a moderate sum for federal IT services. To benchmark this effectively, one would need to compare it against contracts for 'Custom Computer Programming Services' (NAICS 541511) awarded by agencies with similar IT needs. Factors such as contract duration, specific deliverables, and the complexity of the custom programming required would influence comparability. Without more granular data on the scope of work and market rates for comparable services, a precise value comparison is difficult, but it does not appear to be an exceptionally large or small award in the federal IT landscape.

What are the primary risks associated with this contract?

Key risks include potential cost overruns if the scope of 'custom computer programming' is not tightly defined and managed, leading to scope creep. Another risk stems from the limited competition, with only two bidders, which might indicate that the price achieved is not the most competitive possible. Contractor performance risk is also present; if Applied Enterprise Management Corporation fails to deliver the required custom solutions effectively, it could impact the Department of Education's operations. Finally, the long, five-year duration introduces risks related to technological obsolescence or changing requirements that may not be fully anticipated at the outset.

How effective is the firm fixed-price contract type in managing costs for custom programming?

The firm fixed-price (FFP) contract type is generally considered effective for managing costs when the scope of work is well-defined and unlikely to change significantly. For custom programming, FFP provides budget certainty as the contractor assumes most of the risk for cost overruns. This incentivizes the contractor to be efficient. However, if the requirements for custom programming are complex or poorly understood initially, an FFP contract can sometimes lead to the contractor cutting corners on quality or resisting necessary changes, potentially impacting the final product's effectiveness. Clear SOWs and change control processes are crucial.

What are the historical spending patterns for custom computer programming services at the Department of Education?

Analyzing historical spending patterns for custom computer programming services at the Department of Education would require accessing historical federal procurement data. This would involve looking at the total amount spent on NAICS code 541511 (Custom Computer Programming Services) by the Department of Education over previous fiscal years. Trends in spending, the number of contracts awarded, and the average contract values could reveal whether this $14.9 million award is consistent with past investments or represents a significant shift in IT service procurement for the agency. Understanding these patterns can provide context for the current award's scale and importance.

What is the significance of the contract being a 'Definitive Contract'?

A 'Definitive Contract' is a standard, legally binding agreement that clearly outlines the rights and obligations of both the government and the contractor. Unlike other contract types like indefinite-delivery/indefinite-quantity (IDIQ) contracts, a definitive contract typically specifies all the details of the agreement upfront, including the scope of work, price, delivery schedule, and terms. For a $14.9 million award over five years for custom programming, designating it as a definitive contract suggests a well-defined project with predictable requirements, providing clarity and commitment for both parties involved.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 91990023R0004

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 13880 DULLES CORNER LN STE 300, HERNDON, VA, 20171

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

Financial Breakdown

Contract Ceiling: $25,927,928

Exercised Options: $14,944,602

Current Obligation: $14,944,602

Actual Outlays: $13,005,306

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $151,476

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline