DoD's $29M IT contract for code maintenance awarded to Planned Systems International Inc

Contract Overview

Contract Amount: $29,133,855 ($29.1M)

Contractor: Planned Systems International Inc

Awarding Agency: Department of Defense

Start Date: 2018-06-07

End Date: 2019-06-08

Contract Duration: 366 days

Daily Burn Rate: $79.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: CODE MAINTENANCE

Place of Performance

Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22042

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $29.1 million to PLANNED SYSTEMS INTERNATIONAL INC for work described as: CODE MAINTENANCE Key points: 1. The contract value represents a significant investment in maintaining critical IT systems. 2. Full and open competition was utilized, suggesting a potentially competitive bidding process. 3. The fixed-price contract type shifts performance risk to the contractor. 4. The contract duration of 366 days indicates a need for ongoing support. 5. The North American Industry Classification System (NAICS) code 541511 points to custom computer programming services. 6. The contract was awarded as a delivery order under a larger contract vehicle. 7. The small business set-aside status is false, indicating it was not specifically targeted for small businesses.

Value Assessment

Rating: fair

Benchmarking the value of this $29.1 million contract for code maintenance is challenging without more specific details on the scope of services and the complexity of the systems supported. However, the contract was awarded as a delivery order, which can sometimes indicate a more streamlined procurement process. The firm fixed-price nature suggests that the contractor is responsible for managing costs to deliver the agreed-upon services within the contract value. Further analysis would require comparing the per-unit costs or labor rates to similar IT maintenance contracts within the Department of Defense or the broader federal government.

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 data indicates one award was made, but it does not specify the number of bids received. Full and open competition is generally expected to foster price discovery and potentially lead to more competitive pricing for the government.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing inherent in a full and open competition, which aims to ensure the government receives fair market value for the services rendered.

Public Impact

The Defense Health Agency benefits from the continued maintenance of its IT systems, ensuring operational readiness. Services delivered include custom computer programming and maintenance, crucial for the functioning of defense health IT infrastructure. The geographic impact is primarily within the Department of Defense's operational sphere, supporting national security objectives. Workforce implications may include the need for skilled IT professionals to perform the maintenance and development tasks.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if the definition of 'code maintenance' is not precisely defined.
Reliance on a single contractor for critical IT system maintenance could pose a risk if performance issues arise.
The fixed-price nature might incentivize the contractor to minimize effort, potentially impacting the quality of maintenance if not closely monitored.

Positive Signals

The use of full and open competition suggests a robust process for selecting a qualified vendor.
The firm fixed-price contract type provides cost certainty for the government.
The contract is for a defined period, allowing for re-evaluation of needs and contractor performance at its conclusion.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on custom computer programming services (NAICS 541511). The federal IT market is vast, with significant spending allocated to software development, maintenance, and support for critical government systems. Contracts like this are essential for ensuring the operational continuity and security of the IT infrastructure that underpins various government functions, including defense and healthcare. Comparable spending benchmarks would involve analyzing the average cost of similar IT maintenance contracts across federal agencies, considering factors like system complexity and service level agreements.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it indicate any specific subcontracting requirements for small businesses. Therefore, its direct impact on the small business ecosystem is likely minimal, as the primary award went to a larger entity. However, the prime contractor may still engage small businesses as subcontractors, depending on their internal procurement practices and the specific needs of the contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Health Agency's contracting officers and program managers. Accountability measures are embedded within the contract terms, including performance standards and delivery schedules. Transparency is facilitated through contract databases like FPDS, which provide public access to award details. The Inspector General for the Department of Defense may conduct audits or investigations if performance concerns or potential fraud are identified.

Related Government Programs

Defense Health Information Technology
IT Services for Department of Defense
Custom Computer Programming Services
Software Maintenance Contracts
Federal IT Procurement

Risk Flags

Potential for undefined scope in 'code maintenance'
Reliance on a single vendor for critical IT support
Need for robust performance monitoring due to fixed-price nature

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.1 million to PLANNED SYSTEMS INTERNATIONAL INC. CODE MAINTENANCE

Who is the contractor on this award?

The obligated recipient is PLANNED SYSTEMS INTERNATIONAL INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Health Agency).

What is the total obligated amount?

The obligated amount is $29.1 million.

What is the period of performance?

Start: 2018-06-07. End: 2019-06-08.

What is the specific nature of the 'code maintenance' being performed under this contract, and what systems are affected?

The provided data indicates the contract is for 'CODE MAINTENANCE' under NAICS code 541511 (Custom Computer Programming Services). However, the specific systems or applications requiring maintenance are not detailed. Given the awarding agency is the Defense Health Agency (DHA), it is highly probable that this contract supports the maintenance of IT systems critical to military health services, such as electronic health records, patient management systems, or other health IT infrastructure. Without further documentation, the exact scope of 'code maintenance' remains general, encompassing activities like bug fixing, performance optimization, security patching, and potentially minor enhancements to existing software.

How does the awarded amount of approximately $29.1 million compare to similar IT maintenance contracts within the DoD or federal government?

Comparing this $29.1 million contract requires context regarding the duration, scope, and criticality of the systems maintained. For large-scale IT systems within the Department of Defense, especially those supporting critical functions like healthcare, this figure could represent a reasonable annual or multi-year cost for comprehensive maintenance and support. However, without specific benchmarks for comparable systems (e.g., size and complexity of the codebase, number of users, required uptime), it's difficult to definitively assess if this amount is high or low. Federal IT maintenance costs can vary significantly, and a detailed analysis would involve comparing labor rates, service level agreements, and the specific technical requirements of the systems being maintained against similar contracts awarded by agencies like the General Services Administration (GSA) or other defense components.

What are the potential risks associated with a firm fixed-price contract for code maintenance, particularly for complex IT systems?

A firm fixed-price (FFP) contract for code maintenance shifts the primary risk to the contractor, as they are obligated to complete the work for the agreed-upon price, regardless of their actual costs. For complex IT systems, this can present several risks. If the scope of 'maintenance' is not meticulously defined, the contractor might face unforeseen complexities or discover issues requiring more effort than anticipated, potentially leading to reduced profit margins or pressure to cut corners on quality. Conversely, if the scope is too narrowly defined, the government might not receive the full breadth of support needed. There's also a risk that the contractor may prioritize less complex or time-consuming tasks to stay within budget, potentially delaying critical fixes or improvements. Effective oversight and clear performance metrics are crucial to mitigate these risks.

Given this was awarded under 'full and open competition,' how many bids were likely received, and what does this imply for the contractor's track record?

The data states the contract was awarded under 'full and open competition' but only specifies one award. This means that all responsible sources were allowed to compete. However, the number of bids received is not provided. A high number of bids typically suggests strong competition and potentially better pricing for the government. A low number of bids could indicate limited market interest, specialized requirements, or that the contract was part of a larger vehicle where pre-qualified vendors participated. Regarding the contractor's track record, Planned Systems International Inc. (PSI) has a history of federal contracting. The fact that they were awarded this contract under full and open competition suggests they met the technical, management, and cost requirements set forth by the Defense Health Agency, and were deemed the best value among the bidders.

What is the historical spending pattern for code maintenance by the Defense Health Agency, and how does this contract fit within that trend?

Analyzing the historical spending pattern for code maintenance by the Defense Health Agency (DHA) requires access to historical contract data beyond this single award. Without that broader dataset, it's impossible to determine if this $29.1 million contract represents an increase, decrease, or stable level of spending for such services. However, it is reasonable to assume that as a major healthcare provider within the DoD, the DHA relies heavily on IT systems, and thus, consistent investment in code maintenance is likely a recurring necessity. This contract likely fits into an ongoing strategy to ensure the reliability and security of their health IT infrastructure. Future analysis could involve examining DHA's spending on NAICS code 541511 over several fiscal years to identify trends.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 10632 LITTLE PATUXENT PKWY, COLUMBIA, MD, 21044

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Minority Owned Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $29,141,057

Exercised Options: $29,141,057

Current Obligation: $29,133,855

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS35F598GA

IDV Type: FSS

Timeline