Interior's $27M Sprint Contract: A 6-Year Firm Fixed Price Deal with Questionable Value
Contract Overview
Contract Amount: $27,017,749 ($27.0M)
Contractor: Sprint Communications CO LP
Awarding Agency: Department of the Interior
Start Date: 2003-10-01
End Date: 2009-03-30
Contract Duration: 2,007 days
Daily Burn Rate: $13.5K/day
Competition Type: COMPETITIVE DELIVERY ORDER
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: 37269 SPRINT COMMUNICATIONS
Place of Performance
Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22204
State: Virginia Government Spending
Plain-Language Summary
Department of the Interior obligated $27.0 million to SPRINT COMMUNICATIONS CO LP for work described as: 37269 SPRINT COMMUNICATIONS Key points: 1. The contract awarded to Sprint Communications for $27.02 million over six years. 2. Competition was present, indicated by 'COMPETITIVE DELIVERY ORDER', but specific details are limited. 3. Potential risks include the long duration and firm fixed price potentially locking in suboptimal rates. 4. The sector appears to be telecommunications/IT services, a common area for government procurement.
Value Assessment
Rating: questionable
The $27 million price tag over six years for telecommunications services warrants scrutiny. Without specific service details or benchmarks, it's difficult to definitively assess value. However, long-term fixed-price contracts can sometimes lead to overpayment if market rates decrease.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was a 'COMPETITIVE DELIVERY ORDER', suggesting a competitive bidding process was utilized. This method generally promotes price discovery and can lead to better pricing for the government compared to sole-source awards.
Taxpayer Impact: The competitive nature of the award is positive for taxpayers, as it likely resulted in a more favorable price than a non-competitive procurement.
Public Impact
Taxpayers funded a significant telecommunications contract for the Department of the Interior. The six-year duration suggests a need for stable, long-term communication services. The use of a firm fixed price contract implies predictable costs for the agency.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (6 years)
- Firm Fixed Price (potential for overpayment if market rates fall)
- Lack of specific service details for value assessment
Positive Signals
- Competitive award method
- Awarded to a known telecommunications provider
Sector Analysis
This contract falls within the telecommunications and IT services sector. Government spending in this area is substantial, covering everything from basic phone lines to complex network infrastructure. Benchmarks for similar services would be crucial for a precise value assessment.
Small Business Impact
The award went to 'SPRINT COMMUNICATIONS CO LP', a large telecommunications company, not a small business. There is no indication of small business participation or subcontracting in the provided data.
Oversight & Accountability
The 'Departmental Offices' within the Department of the Interior likely have internal oversight mechanisms. However, the long duration and fixed price nature of this delivery order could benefit from periodic reviews to ensure continued value.
Related Government Programs
- Department of the Interior Contracting
- Departmental Offices Programs
Risk Flags
- Potential for overpayment due to firm fixed price over a long duration.
- Lack of specific service details hinders thorough value assessment.
- Risk of pricing becoming uncompetitive over the six-year term.
- No clear indication of small business participation.
Tags
department-of-the-interior, va, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Interior awarded $27.0 million to SPRINT COMMUNICATIONS CO LP. 37269 SPRINT COMMUNICATIONS
Who is the contractor on this award?
The obligated recipient is SPRINT COMMUNICATIONS CO LP.
Which agency awarded this contract?
Awarding agency: Department of the Interior (Departmental Offices).
What is the total obligated amount?
The obligated amount is $27.0 million.
What is the period of performance?
Start: 2003-10-01. End: 2009-03-30.
What specific telecommunications services were procured under this contract, and how did their pricing compare to market rates at the time of award?
The provided data does not specify the exact telecommunications services. To assess value, a detailed breakdown of services (e.g., voice, data, internet bandwidth) and a comparison against prevailing market rates for similar government or commercial contracts during the 2003-2009 period would be necessary. This would reveal if the firm fixed price was competitive.
Given the six-year duration, what mechanisms were in place to mitigate the risk of Sprint's pricing becoming uncompetitive over time?
A firm fixed price contract inherently carries the risk of becoming uncompetitive if market rates decline. Without specific contract clauses allowing for price adjustments or performance-based metrics tied to market competitiveness, the Department of the Interior may have been exposed to paying above-market rates in later years. Periodic market analysis would have been prudent.
How effectively did the competitive delivery order process ensure the best possible outcome for the government in terms of both price and service quality?
The 'COMPETITIVE DELIVERY ORDER' designation suggests a competitive process was used, which is generally positive for price discovery. However, the effectiveness hinges on the specific competition details, such as the number of bidders and the evaluation criteria. A robust competition likely yielded good results, but without further details, the degree of effectiveness remains partially unknown.
Competition & Pricing
Extent Competed: COMPETITIVE DELIVERY ORDER
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Contractor Details
Parent Company: Sprint Communications, Inc. (UEI: 006942395)
Address: 13221 WOODLAND PARK RD, HERNDON, VA, 11
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $27,017,749
Exercised Options: $27,017,749
Current Obligation: $27,017,749
Parent Contract
Parent Award PIID: GS00T99NRD2001
IDV Type: IDC
Timeline
Start Date: 2003-10-01
Current End Date: 2009-03-30
Potential End Date: 2009-03-30 00:00:00
Last Modified: 2012-06-27
More Contracts from Sprint Communications CO LP
- IT Related Products — $57.6M (General Services Administration)
- Provide Wireless Communications in Accordance With the Pbsow and the Contractor's Quote — $33.1M (General Services Administration)
- Communication Services to Support National Guard Communications Infrastructure — $29.5M (Department of the Interior)
- 200412!002626!9700!hc1013!defense Info. Technology Contrac!hc101304c5003 !A!N! !N! ! !20040401!20040930!603493677!012517181!006942395!n!sprint Communications Company !13221 Woodland Park RD !herndon !va!20171!36648!059!51!herndon !fairfax !virginia !+000000877674!n!n!000000000000!s113!telephone And/Or Communications Services !S1 !services !000 !* !517110!E! !3! ! ! ! ! !99990909!b!e!y!a! !d!n!j!1!001!n!1g!z!y!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! !HC1001!0001! ! — $27.8M (Department of Defense)
- IT Products — $13.8M (General Services Administration)
Other Department of the Interior Contracts
- Department of Health and Human Services, Administration of Children and Families, Office of Refugee Resettlement's Legal Services for Unaccompanied Children — $832.4M (Acacia Center for Justice)
- Military Family Life Counseling Program Igf::ot::igf — $638.8M (MHN Government Services LLC)
- Military Family Life Counseling Program — $637.0M (Magellan Healthcare Inc)
- Grants Program Solutions and Information Technology Support Services — $446.3M (Guidehouse Digital LLC)
- THE Purpose of This Requirement for Grants Program Solutions and IT Support Services IS to Provide Efficient and Effective Grant, Financial, and Contract Management Services, IT Solutions, and Support to the Grantsolutions and ITS Partners — $403.1M (Guidehouse Inc.)