DoD's $25.7M contract for Enterprise Military Housing IT services awarded to Next Tier Concepts Inc

Contract Overview

Contract Amount: $25,674,321 ($25.7M)

Contractor: Next Tier Concepts Inc

Awarding Agency: Department of Defense

Start Date: 2025-03-30

End Date: 2026-03-29

Contract Duration: 364 days

Daily Burn Rate: $70.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: ENTERPRISE MILITARY HOUSING

Place of Performance

Location: WASHINGTON NAVY YARD, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20374

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $25.7 million to NEXT TIER CONCEPTS INC for work described as: ENTERPRISE MILITARY HOUSING Key points: 1. Value for money appears fair given the 364-day duration and cost-plus-fixed-fee structure. 2. Competition dynamics indicate a full and open process, suggesting potential for competitive pricing. 3. Risk indicators are moderate, with a cost-plus-fixed-fee contract type potentially leading to cost overruns if not managed closely. 4. Performance context is within IT services for military housing, a critical but often complex operational area. 5. Sector positioning is within IT services supporting defense infrastructure, a significant area of federal spending.

Value Assessment

Rating: fair

The contract value of approximately $25.7 million for a one-year period suggests a daily rate of roughly $70,534. This rate needs to be benchmarked against similar IT support contracts for defense infrastructure. The cost-plus-fixed-fee (CPFF) structure means the government pays allowable costs plus a fixed fee, which can offer flexibility but also carries a risk of cost escalation if not tightly controlled. Without specific performance metrics or detailed cost breakdowns, a definitive value-for-money assessment is challenging, but the price appears within a plausible range for specialized IT services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This process is generally favorable for price discovery and ensuring the government receives competitive offers. The presence of two bidders, as indicated by the 'no' field, suggests a moderate level of competition for this specific award. While more bidders could potentially drive prices lower, full and open competition is a strong indicator of a fair and transparent procurement process.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to more cost-effective solutions and prevent price gouging.

Public Impact

This contract directly benefits the Department of Defense by providing essential IT services for Enterprise Military Housing. The services delivered are expected to enhance the functionality and reliability of IT systems supporting military housing operations. The geographic impact is primarily within the District of Columbia, where the contract is managed. Workforce implications include potential employment opportunities for IT professionals within Next Tier Concepts Inc. and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can incentivize contractors to incur costs without strict budgetary constraints, potentially leading to overspending if not meticulously monitored.
The specific IT services required for Enterprise Military Housing are complex and may involve unique security and integration challenges.
Dependence on a single contractor for critical IT infrastructure could pose a risk if performance issues arise or if the contractor faces financial instability.

Positive Signals

Awarded through full and open competition, suggesting a robust and fair procurement process.
The contractor, Next Tier Concepts Inc., is being awarded a contract, implying they met the necessary qualifications and technical requirements.
The contract duration of one year allows for performance evaluation before potential renewal, providing an opportunity to assess contractor effectiveness.

Sector Analysis

This contract falls within the broader IT services sector, specifically supporting defense and government operations. The federal IT services market is substantial, with significant spending allocated annually to maintain and upgrade critical infrastructure. Contracts like this are essential for ensuring the operational readiness and efficiency of military support functions. Benchmarking this contract's value against other IT support services for similar government facilities would provide further context on its cost-effectiveness.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. However, the prime contractor, Next Tier Concepts Inc., may still engage small businesses as subcontractors, depending on their own procurement strategies and the specific needs of the contract. The absence of a set-aside means the opportunity was open to all qualified large and small businesses.

Oversight & Accountability

Oversight for this contract will likely be managed by the Defense Information Systems Agency (DISA) and relevant Department of Defense contracting officers. Accountability measures are typically embedded within the contract's terms and conditions, including performance standards, reporting requirements, and payment schedules tied to deliverables. Transparency is facilitated through contract award databases, though detailed operational performance data may be less publicly accessible. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Defense Information Systems Agency IT Support Contracts
Military Housing IT Infrastructure
Federal Enterprise IT Services
Cost-Plus-Fixed-Fee IT Contracts

Risk Flags

Cost-plus-fixed-fee contract type carries inherent risk of cost overruns.
Potential for contractor performance issues in complex IT environments.
Need for robust government oversight to manage costs and ensure value.
Dependence on a single awardee for critical IT services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $25.7 million to NEXT TIER CONCEPTS INC. ENTERPRISE MILITARY HOUSING

Who is the contractor on this award?

The obligated recipient is NEXT TIER CONCEPTS INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Information Systems Agency).

What is the total obligated amount?

The obligated amount is $25.7 million.

What is the period of performance?

Start: 2025-03-30. End: 2026-03-29.

What is the track record of Next Tier Concepts Inc. with the Department of Defense and similar IT service contracts?

Assessing the track record of Next Tier Concepts Inc. requires a review of their past performance on federal contracts, particularly those with the Department of Defense and for IT services. Information on contract history, past performance evaluations (e.g., CPARS reports), and any history of contract disputes or terminations would be crucial. A positive history of successful contract completion, adherence to schedules and budgets, and positive performance reviews would indicate a lower risk associated with this award. Conversely, a history of performance issues or contract challenges might raise concerns about the contractor's ability to meet the requirements of this new contract effectively.

How does the estimated daily cost of $70,534 compare to market rates for similar IT support services?

The estimated daily cost of approximately $70,534 for this contract needs to be benchmarked against industry standards for comparable IT support services. Factors influencing this rate include the complexity of the systems supported, the required skill sets of the personnel, security clearances, and the specific services provided (e.g., network management, cybersecurity, software development, help desk support). Comparing this rate to data from similar federal contracts awarded through competitive processes, or to commercial IT service provider rates for equivalent services, would help determine if it represents good value. A higher-than-market rate could indicate potential inefficiencies or a lack of sufficient competition, while a lower rate might suggest aggressive pricing or potential underestimation of the work required.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract structure for this type of service?

The Cost Plus Fixed Fee (CPFF) contract structure, while offering flexibility, carries inherent risks. For the government, the primary risk is that the contractor may have less incentive to control costs, as all allowable costs are reimbursed, and the profit is a fixed amount. This can lead to cost overruns if the contractor's cost estimation is inaccurate or if unforeseen issues drive up expenses. Effective oversight, detailed cost tracking, and robust negotiation of the fixed fee are critical to mitigate these risks. For the contractor, the risk lies in accurately estimating costs to ensure the fixed fee provides adequate profit margin, especially if unforeseen challenges arise.

What are the potential implications of this contract on the IT services market for military housing?

This contract signifies a significant investment by the Department of Defense in the IT infrastructure supporting its military housing. For the IT services market, it indicates a demand for specialized solutions that can integrate with existing defense systems and meet stringent security requirements. The award to Next Tier Concepts Inc. suggests they possess the capabilities deemed necessary for this complex environment. Depending on the scope and duration, this contract could influence market competition, potentially encouraging other firms to develop similar expertise or leading to subcontracting opportunities. It also highlights the ongoing trend of federal agencies modernizing their operational support systems through technology.

How has federal spending on IT services for defense infrastructure evolved over the past five years?

Federal spending on IT services for defense infrastructure has generally seen a consistent increase over the past five years, driven by modernization efforts, cybersecurity imperatives, and the need to support a growing range of defense operations. Agencies like the Department of Defense are increasingly reliant on advanced IT solutions for everything from logistics and personnel management to intelligence and command and control. This trend reflects a strategic shift towards digital transformation within the military. While specific figures fluctuate annually based on budget allocations and emerging threats, the overall trajectory indicates a sustained and significant investment in defense IT, making contracts like this a recurring feature of federal procurement.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HC102815R0030

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 8150 LEESBURG PIKE STE 1400, VIENNA, VA, 22182

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: $223,550,132

Exercised Options: $28,654,045

Current Obligation: $25,674,321

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HC102818D0017

IDV Type: IDC

Timeline