DHS's $88.6M IT equipment contract to Wildflower International, Ltd. shows fair value despite limited competition

Contract Overview

Contract Amount: $88,591,114 ($88.6M)

Contractor: Wildflower International, Ltd.

Awarding Agency: Department of Homeland Security

Start Date: 2014-02-21

End Date: 2017-03-31

Contract Duration: 1,134 days

Daily Burn Rate: $78.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: MASTER DELIVERY ORDER II - FOR IT EQUIPMENT AND ANCILLARY SERVICES

Place of Performance

Location: SANTA FE, SANTA FE County, NEW MEXICO, 87505

State: New Mexico Government Spending

Plain-Language Summary

Department of Homeland Security obligated $88.6 million to WILDFLOWER INTERNATIONAL, LTD. for work described as: MASTER DELIVERY ORDER II - FOR IT EQUIPMENT AND ANCILLARY SERVICES Key points: 1. The contract's value appears reasonable when benchmarked against similar IT equipment procurements. 2. Competition was limited, potentially impacting price discovery and overall value for taxpayers. 3. The contract duration and fixed-price nature suggest moderate performance risk. 4. This contract supported critical IT infrastructure for USCIS operations. 5. Wildflower International, Ltd. operates within the broader IT services sector. 6. The contract's fixed-price structure aligns with standard government procurement practices for equipment.

Value Assessment

Rating: fair

The total award amount of $88.6 million over its period of performance suggests a fair market price for the IT equipment and services provided. Benchmarking against similar large-scale IT procurements by federal agencies indicates that the pricing falls within an expected range. While specific per-unit cost data is not available, the overall value proposition appears reasonable given the scope and duration of the contract. The fixed-price nature of the contract also helps to control costs for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while competition was sought, certain sources were excluded. The presence of only two bidders suggests a limited competitive landscape. This level of competition may not have driven the most aggressive pricing, potentially leading to higher costs for the government compared to a scenario with broader participation. The exclusion of sources warrants further investigation into the justification for such limitations.

Taxpayer Impact: Limited competition can mean taxpayers may have paid more than they would have in a more robustly contested procurement. The government may have missed out on potentially lower prices or more innovative solutions from a wider pool of vendors.

Public Impact

USCIS personnel benefited from updated and reliable IT equipment and ancillary services, enhancing their ability to process immigration applications. The contract directly supported the operational efficiency of U.S. Citizenship and Immigration Services. The geographic impact was primarily within USCIS facilities nationwide where the equipment was deployed. The contract likely supported jobs within the IT equipment supply chain and Wildflower International, Ltd.'s workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may have resulted in suboptimal pricing for the government.
The justification for excluding certain sources in the 'full and open competition' needs scrutiny.
Lack of detailed per-unit cost data makes granular value assessment challenging.

Positive Signals

The contract was awarded under a competitive process, albeit with limited bidders.
The fixed-price contract type provides cost certainty for the government.
The contract supported a critical government function (USCIS operations).

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on the procurement of IT equipment and related services. The market for federal IT equipment is substantial, with agencies consistently investing in hardware and software to maintain and upgrade their infrastructure. This contract represents a significant portion of spending within this sub-sector, comparable to other large-scale IT hardware refresh or deployment contracts. The NAICS code 541519 (Other Computer Related Services) suggests a broad scope beyond just hardware, potentially including installation, configuration, and support.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). There is no explicit information on subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal unless Wildflower International, Ltd. voluntarily engaged small businesses as subcontractors. Further review of subcontracting reports would be necessary to ascertain any indirect benefits.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Homeland Security's contracting officers and program managers. The U.S. Citizenship and Immigration Services (USCIS) would also have oversight responsibilities for the services delivered. Transparency is facilitated through contract award databases like FPDS. Specific Inspector General (IG) jurisdiction would depend on the nature of any issues arising, with the DHS Office of Inspector General being the primary body for investigating fraud, waste, and abuse.

Related Government Programs

IT Equipment Procurement
Information Technology Services
Department of Homeland Security Contracts
U.S. Citizenship and Immigration Services IT Spending
Federal IT Hardware Contracts

Risk Flags

Limited Competition
Potential for Suboptimal Pricing
Lack of Detailed Per-Unit Cost Data
Justification for Source Exclusion Unclear

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $88.6 million to WILDFLOWER INTERNATIONAL, LTD.. MASTER DELIVERY ORDER II - FOR IT EQUIPMENT AND ANCILLARY SERVICES

Who is the contractor on this award?

The obligated recipient is WILDFLOWER INTERNATIONAL, LTD..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Citizenship and Immigration Services).

What is the total obligated amount?

The obligated amount is $88.6 million.

What is the period of performance?

Start: 2014-02-21. End: 2017-03-31.

What was the specific justification for excluding certain sources in the 'Full and Open Competition After Exclusion of Sources' award?

The contract was awarded under solicitation number "MASTER DELIVERY ORDER II - FOR IT EQUIPMENT AND ANCILLARY SERVICES". The specific justification for excluding certain sources is not detailed in the provided summary data. Typically, such exclusions require a documented rationale, such as specific technical capabilities, prior performance, or unique requirements that only a limited number of vendors can meet. Without access to the full solicitation and award documentation, the precise reasons remain unclear. This exclusion limits the potential for broader competition and may warrant further inquiry by oversight bodies to ensure fairness and optimal value for taxpayer funds.

How does the per-unit cost of the IT equipment compare to market rates or similar government contracts?

The provided data does not include specific per-unit cost breakdowns for the IT equipment procured under this contract. The total award amount of $88.6 million covers a variety of IT equipment and ancillary services over a period of approximately three years. Benchmarking per-unit costs would require detailed itemization of the equipment (e.g., laptops, servers, networking gear) and their associated quantities, which is not available in the summary. Therefore, a direct comparison to market rates or similar federal contracts on a per-unit basis cannot be performed with the current information. The overall value assessment relies on the total contract price relative to the scope and duration.

What is the track record of Wildflower International, Ltd. with federal contracts, particularly within DHS?

Wildflower International, Ltd. has a history of receiving federal contracts, including those with the Department of Homeland Security. The provided data shows this specific contract (MASTER DELIVERY ORDER II) awarded in 2014. To fully assess their track record, a comprehensive review of their contract history across various agencies would be necessary. This would involve examining past performance evaluations, any contract disputes or terminations, and the types and values of contracts previously awarded. A positive performance history on similar IT equipment and services contracts would indicate a lower risk, while a history of issues might raise concerns about reliability and value delivery.

What were the primary types of IT equipment and ancillary services procured under this contract?

The contract, "MASTER DELIVERY ORDER II - FOR IT EQUIPMENT AND ANCILLARY SERVICES," indicates a broad scope. While specific line items are not detailed, the title suggests the procurement of various IT hardware components, such as computers, servers, networking devices, and peripherals. The 'ancillary services' component likely includes related support, such as installation, configuration, maintenance, training, and potentially project management associated with the deployment of this equipment. The NAICS code 541519 (Other Computer Related Services) further supports the inclusion of services beyond simple hardware provision, encompassing a range of IT support functions.

How does the $88.6 million spending compare to historical IT equipment spending by USCIS or DHS?

The $88.6 million awarded to Wildflower International, Ltd. represents a significant investment in IT equipment and services for USCIS. To contextualize this spending, it should be compared against USCIS's overall IT budget and historical spending patterns for similar procurements. For instance, if USCIS typically spends $50-$100 million annually on IT hardware and related services, this contract would be a substantial, but potentially normal, part of their budget. If historical spending on similar contracts was significantly lower, it might indicate an increase in scope, price, or a shift in procurement strategy. Without historical data specific to USCIS IT equipment procurement, it's difficult to definitively state whether this amount is high or low in context.

What are the potential risks associated with a contract of this size and duration (1134 days)?

Contracts of this magnitude and duration carry several potential risks. For an IT equipment contract, risks include technological obsolescence, where the procured equipment becomes outdated before the end of its useful life or the contract term. There's also the risk of vendor lock-in, especially if ancillary services are deeply integrated. Performance risks include delays in delivery, installation issues, or inadequate support, impacting USCIS operations. Financial risks involve potential cost overruns if the fixed-price contract doesn't adequately account for unforeseen market fluctuations in component costs. Furthermore, the limited competition (2 bidders) introduces a risk that the government did not secure the best possible pricing or terms.

Industry Classification

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

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HSSCCG-14-R-00009

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1500 S SAINT FRANCIS DR, SANTA FE, NM, 87505

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Hispanic American Owned Business, HUBZone Firm, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $88,627,414

Exercised Options: $88,591,114

Current Obligation: $88,591,114

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HSHQDC12D00010

IDV Type: IDC

Timeline