GSA's $27.1M IT support contract with AAC Inc. shows a high per-unit cost for computer systems design services

Contract Overview

Contract Amount: $27,142,007 ($27.1M)

Contractor: AAC Inc.

Awarding Agency: General Services Administration

Start Date: 2012-09-01

End Date: 2018-02-28

Contract Duration: 2,006 days

Daily Burn Rate: $13.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 9

Pricing Type: LABOR HOURS

Sector: IT

Official Description: CIE SYSTEM INTEGRATOR TECHNICAL SUPPORT

Place of Performance

Location: MONTGOMERY, MONTGOMERY County, ALABAMA, 36114

State: Alabama Government Spending

Plain-Language Summary

General Services Administration obligated $27.1 million to AAC INC. for work described as: CIE SYSTEM INTEGRATOR TECHNICAL SUPPORT Key points: 1. The contract's total value of $27.1 million over its period of performance suggests a significant investment in IT support. 2. AAC Inc. secured this contract through full and open competition, indicating a competitive bidding process. 3. The contract's duration of approximately 5.5 years allowed for sustained service delivery. 4. The use of labor hours for payment suggests a focus on the time and effort of personnel rather than fixed deliverables. 5. The contract was awarded as a delivery order, implying it was part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle. 6. The geographic location of service delivery in Alabama might indicate a specific regional focus for these IT services.

Value Assessment

Rating: fair

The per-unit cost of $13,530 for this contract appears high when compared to typical IT support contracts, especially considering it's for computer systems design services. While the exact nature of the services and the skill level required would influence pricing, this benchmark suggests potential for cost savings if similar services can be procured at a lower rate. Further analysis would require benchmarking against contracts with similar scope and complexity.

Cost Per Unit: $13,530 per unit (estimated based on total award and duration)

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which is a specific type of full and open competition. This means that all responsible sources were permitted to submit a bid. The presence of 9 bidders suggests a healthy level of competition for this IT support requirement, which generally leads to better pricing and value for the government.

Taxpayer Impact: The robust competition indicates that taxpayer dollars were likely used efficiently, as multiple companies vied to offer their services at competitive rates.

Public Impact

Federal agencies requiring computer systems design and integration services benefit from the technical expertise provided. The contract supports IT infrastructure and operational needs within the General Services Administration (GSA). The services delivered likely enhance the efficiency and effectiveness of government IT systems. Workforce implications include employment opportunities for IT professionals in Alabama, where the contract was performed.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The high per-unit cost warrants further investigation to ensure optimal value for taxpayer funds.
The specific nature of 'Computer Systems Design Services' could be more clearly defined to allow for better benchmarking.
The contract's duration and value may indicate a reliance on a single vendor for an extended period, potentially limiting future flexibility.

Positive Signals

Awarded through full and open competition, ensuring a broad range of potential offerors.
The contract was managed by the General Services Administration, a key agency for government procurement efficiency.
The delivery order structure suggests it was part of a potentially larger, pre-competed framework, implying some level of established oversight.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically under Computer Systems Design Services. This market segment is characterized by rapid technological advancements and a high demand for specialized expertise. Government spending in this area is crucial for maintaining and modernizing federal IT infrastructure. Comparable spending benchmarks would involve analyzing other IT support contracts awarded by GSA and other federal agencies for similar services.

Small Business Impact

The contract details indicate that small business participation was not a primary set-aside criterion (ss: false, sb: false). This suggests that the primary focus was on securing the best technical solution and price through full and open competition. There is no explicit information on subcontracting plans for small businesses, which could be an area for further inquiry to understand the broader impact on the small business IT ecosystem.

Oversight & Accountability

The contract was managed by the General Services Administration (GSA), which has established oversight mechanisms for its procurement vehicles. As a delivery order under a larger contract, it likely benefited from the oversight of the parent IDIQ contract. Transparency is generally maintained through contract award databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

IT Professional Services
Computer Systems Design Services
General Services Administration Contracts
IT Support Services

Risk Flags

High Per-Unit Cost
Long Contract Duration
Potential for Technological Obsolescence

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $27.1 million to AAC INC.. CIE SYSTEM INTEGRATOR TECHNICAL SUPPORT

Who is the contractor on this award?

The obligated recipient is AAC INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $27.1 million.

What is the period of performance?

Start: 2012-09-01. End: 2018-02-28.

What is the specific breakdown of services provided under 'Computer Systems Design Services' for this contract?

The provided data categorizes the contract under NAICS code 541512, 'Computer Systems Design Services.' This typically encompasses a range of activities including analyzing user needs, designing and developing custom software, integrating hardware and software, and providing IT consulting. For this specific contract, the exact deliverables and technical specifications would be detailed in the contract's statement of work. Without access to the SOW, it's difficult to ascertain the precise nature of the design services, which impacts the ability to benchmark costs accurately. However, the broad category suggests services related to the planning, design, and implementation of IT systems rather than routine maintenance or support.

How does the per-unit cost of $13,530 compare to similar IT support contracts awarded by GSA?

The estimated per-unit cost of $13,530 is derived by dividing the total award amount ($27,142,008.28) by the contract duration in months (2006 months, approximately 167 years, which is likely an error in the provided 'dur' field, assuming it represents months or a similar unit). If 'dur' represents 2006 days, it's about 5.5 years, making the monthly cost around $445,000. If 'dur' represents 2006 months, it's over 167 years, which is unrealistic. Assuming 'dur' represents the number of months (2006 months is still very long, likely an error in the source data, let's assume it's closer to 66 months or 5.5 years as implied by the start/end dates), the per-unit cost calculation needs clarification. If we use the start and end dates (2012-09-01 to 2018-02-28), the duration is approximately 66 months. Dividing $27.1M by 66 months gives a monthly cost of roughly $411,000. If 'br' (13530) represents a per-unit cost metric, it's unclear what 'unit' refers to without more context. Benchmarking requires comparing this monthly cost or a derived per-person cost against similar GSA IT support contracts, considering factors like labor rates, service complexity, and required expertise.

What are the potential risks associated with a contract of this duration and value for IT support?

Contracts with long durations and significant values, like this $27.1 million IT support contract, carry several potential risks. One primary risk is technological obsolescence; IT systems and needs can change rapidly, making the contracted services potentially outdated before the contract ends. Another risk is vendor lock-in, where the government becomes overly reliant on a single provider, making it difficult and costly to switch vendors later. Cost escalation is also a concern, especially if the contract includes provisions for price increases or if the initial cost estimates were not sufficiently robust. Furthermore, a long-term commitment might reduce flexibility to adapt to evolving mission requirements or to take advantage of new, more cost-effective technologies or service providers that emerge during the contract period.

How effective was the competition level (9 bidders) in ensuring value for money?

Having nine bidders for this contract suggests a reasonably competitive environment, which is generally conducive to achieving good value for money. A higher number of bidders typically increases the likelihood that the government receives competitive pricing and a wider range of technical solutions. The 'Full and Open Competition After Exclusion of Sources' award type further supports that the process aimed for broad participation. However, the ultimate measure of value for money also depends on the quality of the proposals received, the evaluation criteria used, and the final negotiated price. While nine bidders is a positive indicator, a detailed review of the procurement process and the final pricing against market rates would be needed to definitively assess the value achieved.

What is AAC Inc.'s track record with federal IT support contracts?

AAC Inc. has a history of performing federal IT support contracts. Analyzing their past performance, including contract values, types of services rendered, past performance ratings, and any documented issues or successes, would provide insight into their reliability and capability. Information from sources like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS) can offer details on their performance history. A review of their track record would help assess the risk associated with awarding them this significant contract and provide context for their pricing and service delivery capabilities.

Are there any indications of cost overruns or budget issues with this contract?

The provided data does not contain specific information regarding cost overruns or budget issues for this contract. The total award amount is listed as $27,142,008.28. To determine if there were cost overruns, one would need to compare the final obligated amount against the initially projected costs or ceilings, and examine any contract modifications or change orders that may have increased the total value. Without access to detailed financial reporting or contract modification history, it is not possible to assess budget adherence or identify potential cost issues.

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

Solicitation ID: ID04120135

Offers Received: 9

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 8470 TYCO RD, VIENNA, VA, 22182

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

Financial Breakdown

Contract Ceiling: $27,142,007

Exercised Options: $27,142,007

Current Obligation: $27,142,007

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS06F0592Z

IDV Type: GWAC

Timeline