DoD's $212.7M IT services contract with Empower AI, Inc. awarded under full and open competition
Contract Overview
Contract Amount: $212,737,028 ($212.7M)
Contractor: Empower AI, Inc.
Awarding Agency: Department of Defense
Start Date: 2019-09-30
End Date: 2024-03-29
Contract Duration: 1,642 days
Daily Burn Rate: $129.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: JSP SERVICE DELIVERY
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20301
Plain-Language Summary
Department of Defense obligated $212.7 million to EMPOWER AI, INC. for work described as: JSP SERVICE DELIVERY Key points: 1. Contract awarded for IT services, indicating a need for specialized technical support within the Department of Defense. 2. The contract duration of 1642 days suggests a long-term requirement for sustained service delivery. 3. Awarded as a Delivery Order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract vehicle. 4. The firm-fixed-price (FFP) contract type suggests that cost risks are primarily borne by the contractor. 5. The contract was awarded under full and open competition, indicating a broad solicitation process. 6. The North American Industry Classification System (NAICS) code 541519 points to a focus on 'Other Computer Related Services'.
Value Assessment
Rating: good
The total value of $212.7 million over approximately 4.5 years for IT services represents a significant investment by the Department of Defense. Benchmarking this against similar large-scale IT service contracts within the federal government requires detailed analysis of scope and deliverables. However, the firm-fixed-price structure generally aims for cost predictability. Without specific performance metrics or comparison to industry benchmarks for 'Other Computer Related Services,' a precise value-for-money assessment is challenging, but the competitive award suggests a reasonable price was sought.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under 'full and open competition,' meaning all responsible sources were permitted to submit a bid. The presence of 4 bids indicates a moderate level of competition for this requirement. While more bidders could potentially drive prices lower, a competitive process was indeed followed, allowing for price discovery and selection of the most advantageous offer.
Taxpayer Impact: A full and open competition, even with a moderate number of bidders, generally benefits taxpayers by ensuring that the government explores a range of options and receives competitive pricing, rather than being limited to a select few providers.
Public Impact
The Department of Defense benefits from enhanced IT service delivery, crucial for its operational effectiveness. The contract supports the delivery of 'Other Computer Related Services,' likely encompassing a range of IT functions. Services are delivered within the Washington Headquarters Services (WHS) jurisdiction, primarily impacting operations in the Washington D.C. metropolitan area. The contract supports the federal IT workforce, potentially through direct hires by the contractor or through its subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for scope creep if initial requirements are not clearly defined, leading to cost overruns.
- Dependence on a single contractor for critical IT services could pose a risk if performance falters.
- Ensuring continued relevance of services provided as technology evolves rapidly in the IT sector.
Positive Signals
- Firm-fixed-price contract structure shifts cost risk to the contractor.
- Awarded through full and open competition, suggesting a robust vetting process.
- Long contract duration (1642 days) implies a stable, ongoing need for these services.
Sector Analysis
The IT services sector is a vast and critical component of federal spending, supporting nearly every agency's mission. This contract falls under 'Other Computer Related Services,' a broad category that can include IT consulting, system integration, and IT support. The federal government is a major consumer of IT services, with spending often concentrated in areas like defense, intelligence, and civilian agency modernization. Benchmarks for similar contracts would typically look at the total contract value relative to the number of years and the specific IT services provided.
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 mandated by a set-aside. However, the prime contractor, Empower AI, Inc., may choose to subcontract portions of the work to small businesses as part of its overall business strategy, which could provide opportunities within the small business ecosystem.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the program management office within the Department of Defense's Washington Headquarters Services. Accountability measures are inherent in the firm-fixed-price contract type, which incentivizes the contractor to meet performance standards within the agreed-upon price. Transparency is facilitated through contract award databases, though detailed performance reports may not always be publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.
Related Government Programs
- IT Professional Services
- Information Technology Support Services
- Defense Information Technology Services
- Washington Headquarters Services Contracts
- Other Computer Related Services Contracts
Risk Flags
- Contract awarded under Full and Open Competition
- Firm Fixed Price contract type
- Long contract duration (over 4 years)
- Awarded as a Delivery Order (potential IDIQ linkage)
Tags
it-services, department-of-defense, washington-dc, full-and-open-competition, firm-fixed-price, delivery-order, naics-541519, large-contract, it-support, federal-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $212.7 million to EMPOWER AI, INC.. JSP SERVICE DELIVERY
Who is the contractor on this award?
The obligated recipient is EMPOWER AI, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Washington Headquarters Services).
What is the total obligated amount?
The obligated amount is $212.7 million.
What is the period of performance?
Start: 2019-09-30. End: 2024-03-29.
What is the track record of Empower AI, Inc. with federal contracts, particularly within the Department of Defense?
Empower AI, Inc. (formerly known as NCI Information Systems) has a significant history of federal contracting, particularly with the Department of Defense and other civilian agencies. Their portfolio often includes IT modernization, cybersecurity, data analytics, and cloud services. Analyzing their past performance on similar-sized contracts, especially those involving 'Other Computer Related Services,' would provide insight into their ability to deliver on complex requirements. Reviewing past performance evaluations and any documented issues or successes would be crucial for a comprehensive assessment of their track record. Their transition from NCI to Empower AI also suggests a strategic evolution, which may impact their service offerings and operational focus.
How does the $212.7 million contract value compare to other IT service contracts awarded by Washington Headquarters Services (WHS) or the DoD?
The $212.7 million contract value is substantial, placing it among significant IT service procurements within the federal government. Washington Headquarters Services (WHS) manages a large portfolio of contracts supporting DoD operations in the National Capital Region. Comparing this value requires examining the average size and duration of IT service contracts awarded by WHS and the broader DoD over the past several years. Contracts for similar 'Other Computer Related Services' or broader IT support functions would be the most relevant benchmarks. A value of this magnitude suggests a comprehensive scope of work, potentially encompassing multiple IT domains or supporting a large user base, and is consistent with major federal IT investments.
What are the primary risks associated with a firm-fixed-price contract of this magnitude and duration for IT services?
The primary risks with a firm-fixed-price (FFP) contract of this scale and duration for IT services revolve around the contractor's ability to accurately estimate costs and manage performance over an extended period. If Empower AI, Inc. underestimated the complexity or resource requirements, they could face profitability challenges. Conversely, if the government's needs evolve significantly beyond the initial scope, the FFP structure might make it difficult or costly to incorporate changes. Another risk is the potential for the contractor to cut corners on quality or innovation to maintain profit margins, especially if oversight is not rigorous. Ensuring clear performance standards and robust change management processes are critical to mitigating these risks.
How effective is the 'full and open competition' process in ensuring value for money for this type of IT service contract?
The 'full and open competition' process is generally considered the most effective method for ensuring value for money in federal contracting, as it allows the widest possible pool of potential offerors to compete. For IT services, this broad competition can drive innovation and encourage competitive pricing. The fact that this contract received 4 bids suggests a reasonable level of market interest. However, the ultimate effectiveness depends on the clarity of the solicitation, the evaluation criteria, and the government's ability to accurately assess technical capabilities and price proposals. While competition is a strong indicator of potential value, diligent evaluation and oversight remain paramount.
What are the implications of the NAICS code 541519 ('Other Computer Related Services') for the scope and potential performance issues?
The NAICS code 541519, 'Other Computer Related Services,' is quite broad and encompasses a wide array of IT activities beyond standard software development or hardware maintenance. This can include IT consulting, system integration, IT project management, and various support services. The breadth of this code means the specific deliverables under this contract could vary significantly. This ambiguity can sometimes lead to performance issues if expectations are not precisely defined in the contract's statement of work. It necessitates strong contract management to ensure the services delivered align with the government's intended outcomes and that the contractor possesses the diverse expertise required.
What is the historical spending trend for 'Other Computer Related Services' by the Department of Defense?
The Department of Defense is a massive consumer of IT services, and spending within the 'Other Computer Related Services' category (NAICS 541519) has historically been substantial and often increasing, driven by modernization efforts, cybersecurity needs, and the integration of new technologies. Analyzing historical spending data for this specific NAICS code within DoD would reveal trends in contract values, number of awards, and key contractors. Such analysis could indicate whether this $212.7 million award is an outlier, part of a growing trend, or consistent with previous large-scale procurements for similar services. Understanding these patterns provides context for the current contract's significance and potential future spending.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: HQ003418R0044
Offers Received: 4
Pricing Type: FIRM FIXED PRICE (J)
Contractor Details
Address: 11730 PLAZA AMERICA DR STE 700, RESTON, VA, 20190
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $305,360,194
Exercised Options: $237,327,559
Current Obligation: $212,737,028
Actual Outlays: $11,460,643
Subaward Activity
Number of Subawards: 52
Total Subaward Amount: $136,661,615
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: GS35F0108K
IDV Type: FSS
Timeline
Start Date: 2019-09-30
Current End Date: 2024-03-29
Potential End Date: 2024-03-29 00:00:00
Last Modified: 2025-09-22
More Contracts from Empower AI, Inc.
- Digit Award. to Enable GSA IDT to Leverage Infrastructure-Led Disruption to Drive Digital Transformation and Deliver Continuous Improvement and Continuous Business Value to ITS Customers — $328.7M (General Services Administration)
- Systems Engineering and Technical Assitance (seta) Support Services for PEO Soldier and PM Subordinates — $220.5M (Department of Defense)
- THE Cert Program Calculates Bi-Annual Improper Payment Rates Based on the Results of the Reviews Conducted. These Rates Include an Overall National Medicare FFS Improper Payment Rate and Improper Payment Rates for Each Claim Type [part a Inpatient Hospital Prospective Payment System (PPS); Part a Excluding Inpatient Hospital PPS; Part B; and Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (dmepos)]. the Cert Program Ensures a Statistically Valid Random Sample; Therefore, the Improper Payment Rate Calculated From This Sample IS Considered to BE Reflective of ALL of Claims Processed by Medicare FFS Program During the Report Period. CMS Also Uses the Cert Program to Perform Special Studies and Supplemental Measurements to Determine the Improper Payment Rates of Particular Claim Types. Calculations of These Rates Facilitate CMS Ability to Take Appropriate Corrective Actions to Reduce Improper Payments — $206.7M (Department of Health and Human Services)
- National Capital Region (NCR) IT Support Services — $150.1M (Department of the Interior)
- Base Period - Labor - PM Swar — $130.3M (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)