Over $38 million for IT equipment leases to support the National Cancer Institute's Shady Grove campus

Contract Overview

Contract Amount: $38,096,757 ($38.1M)

Contractor: Iron BOW Technologies, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2012-09-19

End Date: 2017-05-31

Contract Duration: 1,715 days

Daily Burn Rate: $22.2K/day

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IT EQUIPMENT LEASE FOR NEW NCI SHADY GROVE CAMPUS - GROUPS 2 - 5.

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20892

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $38.1 million to IRON BOW TECHNOLOGIES, LLC for work described as: IT EQUIPMENT LEASE FOR NEW NCI SHADY GROVE CAMPUS - GROUPS 2 - 5. Key points: 1. Leasing IT equipment offers flexibility and avoids rapid obsolescence compared to outright purchase. 2. The contract was awarded to a single vendor, raising questions about competitive pricing. 3. A long contract duration of over 4 years suggests a need for stable IT infrastructure. 4. The specific IT equipment needs for the NCI Shady Grove campus are critical for research operations. 5. This spending falls within the broader category of IT infrastructure support for federal health agencies.

Value Assessment

Rating: fair

Benchmarking the value of IT equipment leases can be complex due to varying configurations and service levels. Without specific details on the leased equipment (e.g., laptops, servers, networking gear) and the included support services, a direct comparison to similar contracts is difficult. However, the total value of nearly $38.1 million over approximately 4.5 years suggests a significant investment in IT infrastructure. The fixed-price nature of the contract provides cost certainty, but it's crucial to ensure the pricing reflects competitive market rates for the specific equipment and lease terms.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a sole-source delivery order, meaning it was not competed among multiple vendors. While sole-source awards can be justified for various reasons, such as urgency or unique capabilities, they typically limit price competition. The absence of a competitive bidding process means the government may not have secured the lowest possible price for the IT equipment lease. Further justification for the sole-source award would be needed to fully assess the procurement strategy.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers compared to competitively bid contracts, as the government lacks the leverage of multiple vendor proposals to drive down prices.

Public Impact

Researchers and staff at the National Cancer Institute's Shady Grove campus benefit from access to necessary IT equipment. The contract ensures the availability of functional IT infrastructure, supporting critical cancer research and administrative functions. The primary geographic impact is within Maryland, where the Shady Grove campus is located. The contract supports the operational needs of federal employees and potentially contractors working at the NCI facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for overpayment due to sole-source award without competitive pricing.
Lack of transparency regarding the specific IT equipment leased and its market value.
Risk of vendor lock-in if the lease terms are not carefully managed.

Positive Signals

Provides essential IT equipment to support critical cancer research operations.
Fixed-price contract offers budget predictability for the agency.
Leasing model allows for easier upgrades and avoids technology obsolescence.

Sector Analysis

The IT equipment leasing market is a significant segment of the broader IT services industry. Federal agencies frequently lease equipment to maintain up-to-date technology without the capital expenditure of purchasing. This contract for the National Institutes of Health (NIH) aligns with government-wide trends in IT procurement, where flexibility and cost-effectiveness are key considerations. Comparable spending benchmarks would typically involve analyzing lease agreements for similar volumes and types of IT hardware across federal agencies.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. The award to Iron Bow Technologies, LLC, a large business, suggests that small business participation was not a primary focus of this specific procurement. Further analysis would be needed to determine if subcontracting opportunities were available or if small businesses were involved in the supply chain.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Health and Human Services and the National Institutes of Health. As a delivery order under a larger contract vehicle, oversight mechanisms would depend on the terms of that parent contract. Transparency regarding the specific equipment and pricing is limited by the sole-source nature of the award. The Inspector General for HHS would have jurisdiction to investigate any potential fraud, waste, or abuse related to this spending.

Related Government Programs

NIH IT Modernization Efforts
Federal IT Equipment Procurement
Health and Human Services IT Services
Cancer Research Infrastructure

Risk Flags

Sole-source award may limit price competition.
Lack of detailed equipment specifications hinders value assessment.
Potential for higher costs compared to competitive procurement.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $38.1 million to IRON BOW TECHNOLOGIES, LLC. IT EQUIPMENT LEASE FOR NEW NCI SHADY GROVE CAMPUS - GROUPS 2 - 5.

Who is the contractor on this award?

The obligated recipient is IRON BOW TECHNOLOGIES, LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $38.1 million.

What is the period of performance?

Start: 2012-09-19. End: 2017-05-31.

What specific types of IT equipment were leased under this contract, and what were their individual lease costs?

The provided data does not specify the exact types of IT equipment leased (e.g., laptops, desktops, servers, monitors, networking hardware). It also does not break down the lease costs per item. This information is crucial for a detailed value-for-money assessment. Without this granularity, it's impossible to benchmark the cost of individual components against market rates or determine if the overall lease price is reasonable for the technology provided. Understanding the equipment mix would also shed light on the specific operational needs of the NCI Shady Grove campus.

What was the justification for awarding this contract as a sole-source delivery order?

The justification for a sole-source award is critical for understanding why this contract was not competed. Common reasons include urgency of need, lack of available competition, or a unique capability possessed by the sole awardee. For this contract, the specific justification from the Department of Health and Human Services is not provided. Without this rationale, it is difficult to assess whether the sole-source approach was appropriate and if it resulted in a fair and reasonable price for the government. A detailed review of the justification document would be necessary.

How does the total lease cost compare to the estimated cost of purchasing similar IT equipment outright at the time of award?

Comparing the total lease cost to an outright purchase requires estimating the market value of the IT equipment at the contract's inception and considering the lease duration. If the lease term is significantly shorter than the useful life of the equipment, leasing can be more cost-effective by avoiding obsolescence. However, if the lease term is long, the total lease payments could exceed the purchase price. Without knowing the specific equipment and its expected lifespan, this comparison is speculative. A detailed analysis would involve projecting the total lease payments ($38.1 million over ~4.5 years) against the depreciated value of purchased assets over a similar period.

What performance metrics or service level agreements (SLAs) were included in the contract to ensure the quality and reliability of the leased IT equipment?

The provided data does not detail the performance metrics or service level agreements (SLAs) associated with this IT equipment lease. Effective contracts typically include SLAs covering aspects like equipment uptime, response times for maintenance and repairs, and equipment refresh cycles. The absence of this information raises concerns about accountability and the government's ability to enforce service quality. A thorough review of the full contract documentation would be needed to ascertain the presence and adequacy of such performance standards.

What is Iron Bow Technologies, LLC's track record with similar large-scale IT leasing contracts for federal health agencies?

Iron Bow Technologies, LLC has a history of providing IT solutions and services to the federal government, including health agencies. Assessing their track record for similar large-scale IT leasing contracts would involve reviewing their past performance evaluations, contract history, and any reported issues or successes on previous agreements. While the data indicates they were awarded this contract, a deeper dive into their specific experience with leasing versus direct sales, and their performance on comparable NIH or HHS contracts, would provide better insight into their capabilities and reliability for this specific requirement.

Industry Classification

NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing

Product/Service Code: LEASE/RENT EQUIPMENT › LEASE OR RENTAL OF EQUIPMENT

Contractor Details

Address: 4800 WESTFIELDS BLVD STE 300, CHANTILLY, VA, 20151

Business Categories: Category Business, Small Business

Financial Breakdown

Contract Ceiling: $41,323,983

Exercised Options: $38,096,757

Current Obligation: $38,096,757

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 263030519

IDV Type: GWAC

Timeline