DoD's Defense Health Agency awards $41.6M contract for enterprise software delivery services to American Systems Corp
Contract Overview
Contract Amount: $41,648,700 ($41.6M)
Contractor: American Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2021-03-27
End Date: 2023-03-26
Contract Duration: 729 days
Daily Burn Rate: $57.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: CONTINUITY OF SERVICES FOR THE ENTERPRISE SERVICES SOFTWARE REQUIREMENT, WHICH INCLUDES ENTERPRISE LEVEL SOFTWARE DELIVERY SERVICE PLATFORM AND OTHER EXPERTISE NECESSARY TO TRANSFORM EXISTING INFRASTRUCTURE INTO A MODERN SOFTWARE DELIVERY PLATFORM.
Place of Performance
Location: CHANTILLY, FAIRFAX County, VIRGINIA, 20151
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $41.6 million to AMERICAN SYSTEMS CORPORATION for work described as: CONTINUITY OF SERVICES FOR THE ENTERPRISE SERVICES SOFTWARE REQUIREMENT, WHICH INCLUDES ENTERPRISE LEVEL SOFTWARE DELIVERY SERVICE PLATFORM AND OTHER EXPERTISE NECESSARY TO TRANSFORM EXISTING INFRASTRUCTURE INTO A MODERN SOFTWARE DELIVERY PLATFORM. Key points: 1. The contract focuses on modernizing infrastructure through a software delivery platform. 2. American Systems Corporation is the sole awardee, raising questions about competition. 3. The contract's duration is 729 days, ending in March 2023. 4. This spending falls under Computer Facilities Management Services.
Value Assessment
Rating: fair
The contract value of $41.6M over two years averages $20.8M annually. Benchmarking against similar IT infrastructure modernization contracts is difficult without more specific service details, but the annual spend appears moderate for enterprise-level solutions.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as competitive pressures are absent.
Taxpayer Impact: The lack of competition for a significant IT modernization contract may result in suboptimal pricing and reduced value for taxpayer funds.
Public Impact
Modernization of critical healthcare IT infrastructure impacts patient care and data security. The reliance on a single vendor for essential software delivery services could create dependency. Ensuring the transformation meets modern security and interoperability standards is crucial for the DHA.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Potential for vendor lock-in due to specialized services.
- Contract duration and value require careful monitoring for efficiency.
Positive Signals
- Focus on modernizing critical IT infrastructure.
- Award to a single, potentially capable vendor for continuity.
Sector Analysis
This contract falls within the IT sector, specifically Computer Facilities Management Services. Spending benchmarks for enterprise-level software delivery platforms can vary widely based on scope, but $41.6M over two years suggests a substantial undertaking for the Defense Health Agency.
Small Business Impact
The contract was awarded to American Systems Corporation, and there is no indication that small businesses were involved as subcontractors or partners in this specific award. Further analysis would be needed to determine if small business participation was considered or mandated.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the contractor is delivering services effectively and at a fair price. The Defense Health Agency should have robust internal controls and performance metrics in place.
Related Government Programs
- Computer Facilities Management Services
- Department of Defense Contracting
- Defense Health Agency Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Vendor lock-in risk
- Dependency on a single provider
Tags
computer-facilities-management-services, department-of-defense, va, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $41.6 million to AMERICAN SYSTEMS CORPORATION. CONTINUITY OF SERVICES FOR THE ENTERPRISE SERVICES SOFTWARE REQUIREMENT, WHICH INCLUDES ENTERPRISE LEVEL SOFTWARE DELIVERY SERVICE PLATFORM AND OTHER EXPERTISE NECESSARY TO TRANSFORM EXISTING INFRASTRUCTURE INTO A MODERN SOFTWARE DELIVERY PLATFORM.
Who is the contractor on this award?
The obligated recipient is AMERICAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Health Agency).
What is the total obligated amount?
The obligated amount is $41.6 million.
What is the period of performance?
Start: 2021-03-27. End: 2023-03-26.
What specific metrics are being used to measure the success of the infrastructure transformation and the effectiveness of the software delivery platform?
The contract details do not specify the exact metrics for success. However, typical measures for such transformations include system uptime, deployment speed, reduction in technical debt, improved security posture, and user satisfaction. The Defense Health Agency should be tracking these against defined baselines to ensure the $41.6M investment yields tangible improvements.
Given the sole-source nature, how was the 'fair and reasonable' price determined for this $41.6M contract?
Without a competitive process, price reasonableness is typically determined through cost analysis, comparison to historical pricing for similar services (if available), or market research. The Defense Contract Audit Agency (DCAA) may have reviewed the contractor's proposed costs. The agency should have justification documentation for how this price was deemed fair.
What is the long-term strategy for this software delivery platform, and will future requirements be competed to ensure ongoing value?
The long-term strategy is not detailed in the provided data. However, for significant IT investments, agencies typically plan for future phases. It is crucial that subsequent requirements, if they evolve, are evaluated for competitive opportunities to leverage market innovation and ensure sustained cost-effectiveness for the taxpayer.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Facilities Management Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 14151 PARK MEADOW DR STE 500, CHANTILLY, VA, 20151
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $42,558,885
Exercised Options: $42,558,885
Current Obligation: $41,648,700
Actual Outlays: $53,142
Subaward Activity
Number of Subawards: 83
Total Subaward Amount: $11,790,701
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2021-03-27
Current End Date: 2023-03-26
Potential End Date: 2023-03-26 00:00:00
Last Modified: 2023-11-16
More Contracts from American Systems Corporation
- Arms Csip FR300 Cs-Tsr in JAX — $107.2M (Department of Defense)
- Testing Infrastructure Managed Services (tims) for PEO,Dhms "igf::ct::igf" — $83.6M (Department of the Interior)
- Program Engagement and Independent Technical Assessments — $75.1M (Department of Defense)
- This IS for Operational Professional Research and Engineering Support for the Under Secretary of Defense Research and Engineering, Developmental Test Evaluation and Assessments Office — $74.6M (Department of Defense)
- Emergency Mass Notification System Task Order Award — $74.4M (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)