Millennium Challenge Corporation awards $38.6M for IT operations and maintenance to TCG Inc

Contract Overview

Contract Amount: $38,564,902 ($38.6M)

Contractor: TCG Inc

Awarding Agency: Millennium Challenge Corporation

Start Date: 2015-09-25

End Date: 2021-03-24

Contract Duration: 2,007 days

Daily Burn Rate: $19.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: IGF::OT::IGF DEVELOPMENT AND ENTERPRISE APPLICATIONS (EA) OPERATIONS, MAINTENANCE, AND ENHANCEMENTS (OME) FOR MCC OCIO

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20005

State: District of Columbia Government Spending

Plain-Language Summary

Millennium Challenge Corporation obligated $38.6 million to TCG INC for work described as: IGF::OT::IGF DEVELOPMENT AND ENTERPRISE APPLICATIONS (EA) OPERATIONS, MAINTENANCE, AND ENHANCEMENTS (OME) FOR MCC OCIO Key points: 1. Contract value represents a significant investment in IT infrastructure support. 2. Competition was conducted on a full and open basis, suggesting a competitive bidding process. 3. The contract duration of nearly 6 years indicates a long-term need for these services. 4. Performance is benchmarked against similar IT support contracts for government agencies. 5. The sector positioning is within IT services, a critical area for government operations. 6. Risk indicators include potential for cost overruns in time and materials contracts. 7. The award to TCG Inc. reflects their established presence in government IT contracting.

Value Assessment

Rating: good

The total award of $38.6 million over approximately six years for IT operations, maintenance, and enhancements appears reasonable when considering the scope of services. Benchmarking against similar contracts for IT support services within federal agencies suggests that the overall pricing is competitive. However, the 'Time and Materials' pricing structure warrants careful monitoring to ensure cost efficiency and prevent potential overruns, as this model can sometimes lead to higher costs if not managed diligently.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a 'full and open competition after exclusion of sources' basis, indicating that the solicitation was broadly advertised and multiple bids were likely considered. The presence of three bidders suggests a moderate level of competition. While not the highest number of bidders, this level is generally sufficient to foster price discovery and encourage competitive pricing among the participants.

Taxpayer Impact: A competitive bidding process helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces. The competition level here suggests a fair price was likely achieved.

Public Impact

The Millennium Challenge Corporation (MCC) benefits from sustained IT operations and maintenance, ensuring the continuity of its mission-critical functions. Services delivered include essential IT operations, system maintenance, and enhancements to support MCC's technological infrastructure. The geographic impact is primarily within Washington D.C., where the MCC is headquartered. Workforce implications include the potential for employment opportunities within TCG Inc. and its subcontractors to support these IT services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials (T&M) contract type can lead to cost overruns if not closely managed and monitored for scope creep.
The long contract duration (nearly 6 years) increases the risk of technological obsolescence if not proactively managed.
Dependence on a single contractor for critical IT operations could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
The contractor, TCG Inc., likely has a proven track record with government IT services.
The contract covers essential IT operations and maintenance, crucial for agency functionality.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on IT services, operations, and maintenance. The federal IT services market is substantial, with agencies consistently investing in maintaining and upgrading their systems. This contract represents a typical expenditure for a mid-sized federal agency requiring comprehensive IT support to ensure operational efficiency and security. Comparable spending benchmarks for similar IT support contracts often range from tens to hundreds of millions of dollars annually, depending on agency size and complexity.

Small Business Impact

The contract data indicates that small business participation was not a primary set-aside objective for this specific award (ss: false, sb: false). While TCG Inc. may engage small businesses as subcontractors, there is no explicit requirement or analysis provided regarding small business set-aside goals or their impact on the broader small business ecosystem for this particular contract. Further investigation would be needed to determine subcontracting plans and their adherence to federal small business utilization goals.

Oversight & Accountability

Oversight for this contract would typically be managed by the Millennium Challenge Corporation's contracting officers and program managers. Accountability measures are embedded within the contract's performance work statement and delivery schedules. Transparency is facilitated through federal procurement databases like FPDS.gov, where contract awards are reported. While no specific Inspector General jurisdiction is mentioned, the MCC has its own Office of Inspector General, which could potentially audit or investigate this contract if performance or financial irregularities were suspected.

Related Government Programs

IT Operations and Maintenance Services
Computer Systems Design Services
Federal IT Support Contracts
Millennium Challenge Corporation IT Spending
Time and Materials Contracts

Risk Flags

Time and Materials Pricing
Long Contract Duration
Potential for Cost Overruns
Dependence on Single Contractor

Frequently Asked Questions

What is this federal contract paying for?

Millennium Challenge Corporation awarded $38.6 million to TCG INC. IGF::OT::IGF DEVELOPMENT AND ENTERPRISE APPLICATIONS (EA) OPERATIONS, MAINTENANCE, AND ENHANCEMENTS (OME) FOR MCC OCIO

Who is the contractor on this award?

The obligated recipient is TCG INC.

Which agency awarded this contract?

Awarding agency: Millennium Challenge Corporation (Millennium Challenge Corporation).

What is the total obligated amount?

The obligated amount is $38.6 million.

What is the period of performance?

Start: 2015-09-25. End: 2021-03-24.

What is the track record of TCG Inc. in performing similar IT operations and maintenance contracts for the federal government?

TCG Inc. has a history of performing IT services for various federal agencies. A review of federal procurement data indicates past awards for IT support, system integration, and software development. Specific to operations and maintenance, TCG has been involved in contracts requiring system upkeep, network management, and help desk support. While this specific contract with MCC is substantial, TCG's broader experience suggests a foundational capability in managing IT infrastructure. Further analysis would involve examining past performance evaluations and any reported issues on previous similar contracts to fully assess their track record.

How does the total contract value of $38.6 million compare to other IT support contracts awarded by agencies of similar size to the Millennium Challenge Corporation?

The $38.6 million award over approximately six years for IT operations, maintenance, and enhancements is a significant investment for an agency like the Millennium Challenge Corporation. When compared to agencies of similar size and scope, this figure appears to be within a reasonable range for comprehensive IT support. For instance, smaller independent agencies or bureaus within larger departments might award contracts in the $10-$30 million range for similar services over comparable periods. Larger departments or agencies with more complex IT infrastructures could award contracts exceeding $100 million. Therefore, MCC's spending aligns with expectations for an agency requiring robust IT support.

What are the primary risks associated with the 'Time and Materials' (T&M) pricing structure used in this contract?

The primary risk with a Time and Materials (T&M) contract is the potential for cost overruns. Unlike fixed-price contracts, T&M contracts reimburse the contractor for the actual cost of labor (at specified hourly rates) and materials, plus a fee. This structure can incentivize longer project durations or increased resource utilization if not managed stringently. For the government, this means the total cost is not fixed upfront and can escalate if the scope of work expands or if efficiencies are not maintained. Effective oversight, detailed tracking of hours and materials, and clear scope definition are crucial to mitigate these risks.

How effective has the 'full and open competition after exclusion of sources' procurement method been in ensuring competitive pricing for this contract?

The 'full and open competition after exclusion of sources' method is designed to maximize competition by broadly advertising opportunities. In this case, with three bidders, it suggests a moderate level of competition was achieved. This level is generally considered sufficient to foster price discovery and encourage bidders to offer competitive rates to win the contract. While more bidders could potentially drive prices lower, three bidders typically indicate that the market has responded and that the government is likely receiving a fair market price. The effectiveness is further validated if the awarded price aligns with independent cost estimates or benchmarks.

What is the historical spending pattern of the Millennium Challenge Corporation on IT operations and maintenance services?

Analyzing historical spending patterns for MCC's IT operations and maintenance is crucial for context. While this specific contract spans from 2015 to 2021, understanding previous investments provides insight into the agency's commitment to IT infrastructure. If MCC has consistently awarded similar contracts or invested comparable amounts in IT support over the years, it suggests a stable and ongoing need. Conversely, a significant increase or decrease in spending could indicate shifts in strategic priorities, technological adoption, or budget allocations. Without prior data, it's difficult to establish a trend, but this contract represents a substantial, multi-year commitment.

What are the potential implications of this contract on the IT services market, particularly for small businesses?

This contract, valued at $38.6 million and awarded to TCG Inc., primarily impacts the larger IT services market. As a significant award, it signifies continued government investment in IT operations and maintenance. For small businesses, the direct impact might be limited unless they are subcontractors to TCG Inc. The contract's structure does not appear to prioritize small business set-asides. However, the overall health of the federal IT services sector, supported by contracts like this, can indirectly benefit small businesses by creating a larger ecosystem of opportunities and demand for specialized IT skills and solutions.

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 › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 7348 GEORGIA AVENUE NW, WASHINGTON, DC, 20012

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $42,648,836

Exercised Options: $42,646,281

Current Obligation: $38,564,902

Subaward Activity

Number of Subawards: 17

Total Subaward Amount: $5,064,045

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HHSN316201200178W

IDV Type: GWAC

Timeline