DOT's $125M IT contract to LS Technologies LLC for custom programming services awarded under BPA Call

Contract Overview

Contract Amount: $125,149,537 ($125.1M)

Contractor: LS Technologies LLC

Awarding Agency: Department of Transportation

Start Date: 2014-05-20

End Date: 2023-08-22

Contract Duration: 3,381 days

Daily Burn Rate: $37.0K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: NEO SUPPORT SERVICES CONTRACT IGF::OT::IGF

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20591

State: District of Columbia Government Spending

Plain-Language Summary

Department of Transportation obligated $125.1 million to LS TECHNOLOGIES LLC for work described as: NEO SUPPORT SERVICES CONTRACT IGF::OT::IGF Key points: 1. Contract awarded under BPA Call, indicating a pre-competed framework. 2. Time and Materials pricing structure may pose cost control challenges. 3. Contract duration of 3381 days suggests a long-term need for services. 4. The North American Industry Classification System (NAICS) code 541511 points to custom computer programming. 5. The contract was competed, suggesting some level of market engagement. 6. The awardee, LS Technologies LLC, is a single entity for this contract. 7. The contract was awarded to a single vendor, raising questions about potential for broader competition.

Value Assessment

Rating: fair

The contract's total value of $125.15 million over approximately 9 years presents a significant investment. Benchmarking the value-for-money is challenging without specific deliverables and performance metrics. The Time and Materials (T&M) pricing model, while flexible, can lead to cost overruns if not managed diligently. Comparing this to similar custom programming contracts within the FAA or DOT would require detailed analysis of scope, duration, and labor rates. The absence of a fixed price or performance-based elements warrants closer scrutiny of cost controls and oversight.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was competed under a Blanket Purchase Agreement (BPA) Call, which implies that the underlying BPA was established through a competitive process. However, the specifics of how many entities were invited to bid on this particular call order are not detailed in the provided data. A BPA Call typically involves soliciting offers from pre-qualified vendors on the BPA. The fact that it was competed suggests that multiple vendors had the opportunity to submit proposals, which is generally positive for price discovery.

Taxpayer Impact: A competed award, even under a BPA Call, is generally favorable for taxpayers as it allows for market forces to influence pricing and potentially secure better value compared to a sole-source award.

Public Impact

The primary beneficiary is the Department of Transportation, specifically the Federal Aviation Administration, which receives custom computer programming services. These services likely support critical IT infrastructure and operational systems within the FAA. The contract's impact is concentrated in the District of Columbia, where the services are presumably delivered. The contract supports jobs within the IT services sector, particularly in custom software development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials pricing can lead to uncontrolled cost escalation if not rigorously monitored.
Long contract duration (3381 days) increases the risk of scope creep and vendor lock-in.
Limited information on specific performance metrics makes it difficult to assess true value for money.
Competition under a BPA Call might be less robust than a direct full-and-open competition.

Positive Signals

The contract was competed, indicating some level of market engagement and potential for competitive pricing.
Awarded under a BPA Call suggests a pre-vetted vendor pool, potentially streamlining acquisition.
The vendor, LS Technologies LLC, has secured a significant contract, indicating a level of established capability.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically custom computer programming services. The IT services market is vast and highly competitive, with significant government spending allocated to software development, system integration, and IT support. The FAA, as a major federal agency, relies heavily on IT for its operations, including air traffic control, data management, and communication systems. This contract likely represents a portion of the FAA's broader IT modernization and maintenance efforts, fitting into a landscape of numerous similar contracts supporting federal agency technology needs.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, it does not directly contribute to small business set-aside goals. There is no information regarding subcontracting plans or performance. The award to LS Technologies LLC, a single entity, does not provide insight into whether small businesses are involved as subcontractors. The focus appears to be on fulfilling the agency's IT needs through a larger contract vehicle.

Oversight & Accountability

Oversight for this contract would typically reside within the Federal Aviation Administration's contracting and program management offices. The contract's duration and value suggest that regular performance reviews, financial audits, and compliance checks would be necessary. Inspector General (IG) jurisdiction would apply if any fraud, waste, or abuse were suspected. Transparency is facilitated by contract databases like FPDS, but detailed performance reports and oversight findings are not always publicly accessible.

Related Government Programs

FAA IT Modernization Programs
Custom Software Development Services
IT Support Services Contracts
Department of Transportation IT Spending
BPA Call Awards

Risk Flags

Potential for cost overruns due to Time and Materials pricing structure.
Risk of scope creep over the long contract duration.
Lack of specific performance metrics makes value assessment difficult.
Technology obsolescence risk over the 9-year contract period.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $125.1 million to LS TECHNOLOGIES LLC. NEO SUPPORT SERVICES CONTRACT IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is LS TECHNOLOGIES LLC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $125.1 million.

What is the period of performance?

Start: 2014-05-20. End: 2023-08-22.

What is the track record of LS Technologies LLC in performing similar custom computer programming services for the federal government?

Assessing the track record of LS Technologies LLC requires a deeper dive into their past performance on federal contracts. While this specific contract is substantial, understanding their history with similar Time and Materials (T&M) contracts, their on-time and on-budget delivery rates, and any past performance issues or commendations is crucial. Reviewing contract award histories, performance evaluations (if available), and any contract disputes or terminations would provide a clearer picture of their reliability and capability in delivering complex IT solutions. Without this historical context, it's difficult to fully gauge the risk associated with their performance on this $125 million award.

How does the estimated cost per day or per year for this contract compare to industry benchmarks for custom computer programming services?

To benchmark the cost-effectiveness of this $125 million contract, an analysis of its estimated cost per day or per year against industry standards for custom computer programming is necessary. This would involve calculating the average daily or annual cost based on the contract's duration (3381 days) and total value ($125,149,537.38). The average daily cost is approximately $37,016. This figure needs to be compared with prevailing market rates for similar services, considering factors like labor categories, skill levels, geographic location, and the complexity of the programming tasks. The Time and Materials (T&M) nature of the contract adds complexity, as actual costs can fluctuate. A thorough benchmark would require access to detailed labor rates and overhead structures.

What are the specific performance metrics and deliverables associated with this contract, and how is performance being measured?

The provided data lacks specific details on the performance metrics and deliverables for this NEO SUPPORT SERVICES CONTRACT. Understanding how the Federal Aviation Administration (FAA) measures the success of LS Technologies LLC is critical for assessing value for money and contractor performance. Key performance indicators (KPIs) related to software quality, development timelines, system uptime, user satisfaction, and adherence to security protocols would be expected. Without defined deliverables and measurable outcomes, it is challenging to determine if the $125 million investment is yielding the intended results and meeting the agency's operational needs effectively. The Time and Materials (T&M) contract type necessitates robust oversight to ensure that effort translates into valuable output.

What is the historical spending trend for custom computer programming services by the FAA or DOT over the past 5-10 years?

Analyzing the historical spending trends for custom computer programming services by the FAA or DOT over the past 5-10 years provides essential context for this $125 million contract. Understanding whether this award represents an increase, decrease, or stable level of investment in such services can indicate shifts in agency priorities or technological needs. Examining past contract awards for similar services (NAICS 541511), their values, durations, and the contractors involved would reveal patterns. This historical data helps in assessing if the current spending is aligned with long-term strategic IT goals and if the agency is effectively managing its IT budget in this domain. It also helps identify potential consolidation or expansion of IT service providers.

What are the potential risks associated with a long-duration (3381 days) Time and Materials contract for custom programming?

A long-duration (3381 days, approximately 9 years) Time and Materials (T&M) contract for custom computer programming presents several inherent risks. Firstly, the T&M structure, without strong cost controls and oversight, can lead to significant cost overruns as labor hours and material costs accumulate without a fixed ceiling. Secondly, the extended duration increases the risk of scope creep, where requirements evolve beyond the original intent, leading to unplanned expenses. Thirdly, long-term contracts can foster vendor lock-in, making it difficult and costly to switch providers even if performance degrades or better solutions emerge. Finally, technology evolves rapidly; a contract spanning nearly a decade risks becoming outdated if not actively managed and adapted, potentially diminishing its value.

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: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Tetra Tech, Inc.

Address: 2750 PROSPERITY AVE STE 640, FAIRFAX, VA, 22031

Business Categories: 8(a) Program Participant, Asian Pacific American Owned Business, Category Business, Minority Owned Business, Partnership or Limited Liability Partnership, Small Business, Small Disadvantaged Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $125,149,537

Exercised Options: $125,149,537

Current Obligation: $125,149,537

Actual Outlays: $61,874,764

Subaward Activity

Number of Subawards: 6

Total Subaward Amount: $14,960,058

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DTFAWA10A00213

IDV Type: BPA

Timeline