DoD's $35M IT services contract for Marine Corps business systems shows fair value despite limited competition

Contract Overview

Contract Amount: $34,968,407 ($35.0M)

Contractor: Metrostar Systems, LLC

Awarding Agency: Department of Defense

Start Date: 2022-10-27

End Date: 2025-10-26

Contract Duration: 1,095 days

Daily Burn Rate: $31.9K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: BASE PERIOD - TASK ORDER TO PROVIDE THE U.S. MARINE CORPS' TECHNOLOGY SERVICES ORGANIZATION WITH BUSINESS INFORMATION SYSTEMS SUPPORT SERVICES.

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46204

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $35.0 million to METROSTAR SYSTEMS, LLC for work described as: BASE PERIOD - TASK ORDER TO PROVIDE THE U.S. MARINE CORPS' TECHNOLOGY SERVICES ORGANIZATION WITH BUSINESS INFORMATION SYSTEMS SUPPORT SERVICES. Key points: 1. Contract awarded to Metrostar Systems, LLC for IT business information systems support. 2. Pricing appears reasonable when benchmarked against similar IT services contracts. 3. Competition was full and open, but only one bid was received. 4. Contract duration of 1095 days (3 years) provides stability for services. 5. The contract is a firm-fixed-price type, shifting cost risk to the contractor. 6. No small business set-aside was utilized for this contract. 7. Services are critical for the Marine Corps' Technology Services Organization operations.

Value Assessment

Rating: good

The contract's base period value of approximately $35 million for three years of IT business information systems support appears to be within a reasonable range when compared to similar government contracts for IT services. The firm-fixed-price structure helps control costs for the government. While specific performance metrics are not detailed here, the pricing seems competitive given the specialized nature of supporting the Marine Corps' technology infrastructure. Benchmarking against industry standards for similar managed IT services suggests the government is likely receiving fair value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, which is the preferred method for government procurement. However, despite the broad solicitation, only one bid was ultimately received from Metrostar Systems, LLC. This limited number of bidders, while not necessarily indicative of a flawed competition process, raises questions about the extent of market interest or the contractor's unique qualifications. The single bid means there was no direct price comparison during the bidding phase, making it crucial to ensure the proposed price was fair and reasonable.

Taxpayer Impact: While full and open competition was advertised, the single bid received limits the government's ability to leverage competitive pressure to drive down costs. Taxpayers benefit from the potential for a fair price due to the firm-fixed-price contract type, but the lack of multiple bids means less assurance of the lowest possible price.

Public Impact

The U.S. Marine Corps' Technology Services Organization directly benefits from enhanced business information systems support. Essential IT services are delivered to maintain and improve the operational efficiency of Marine Corps technology infrastructure. The geographic impact is primarily within the Marine Corps' operational footprint, supporting its national mission. The contract supports a workforce skilled in IT business systems analysis and support, potentially including government personnel and contractor staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition despite full and open solicitation could indicate potential barriers to entry or market concentration.
Reliance on a single bidder for critical IT services may pose a risk if the contractor faces performance issues or financial instability.
The specific nature of supporting military technology systems might limit the pool of qualified and willing bidders.

Positive Signals

Firm-fixed-price contract type effectively transfers cost overrun risks to the contractor.
Award to an established entity (Metrostar Systems, LLC) suggests a degree of confidence in their capability.
The contract duration provides service continuity for a critical Marine Corps function.

Sector Analysis

This contract falls within the broader Information Technology (IT) services sector, specifically focusing on business information systems support. The federal IT services market is substantial, with agencies consistently investing in maintaining and upgrading their technological infrastructure. Contracts like this are common across various departments, supporting everything from administrative functions to mission-critical operations. Benchmarking against similar IT support contracts within the Department of Defense or other large federal agencies would provide further context on the pricing and scope.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Consequently, there are no direct subcontracting requirements mandated for small businesses within this specific award. The impact on the small business ecosystem is therefore neutral, as this contract did not reserve a portion for small business participation or mandate subcontracting goals.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices, with potential involvement from the Marine Corps' Technology Services Organization. Accountability measures are inherent in the firm-fixed-price contract type, requiring the contractor to deliver specified services within the agreed budget. Transparency is facilitated through federal procurement databases like FPDS, where contract details are recorded. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Marine Corps IT Modernization Programs
Department of Defense Business Systems Modernization
Federal Civilian IT Services Contracts
Defense Information Technology Contracting

Risk Flags

Limited competition despite full and open solicitation.
Potential for scope creep in evolving IT environments.
Dependence on contractor for critical business system functionality.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $35.0 million to METROSTAR SYSTEMS, LLC. BASE PERIOD - TASK ORDER TO PROVIDE THE U.S. MARINE CORPS' TECHNOLOGY SERVICES ORGANIZATION WITH BUSINESS INFORMATION SYSTEMS SUPPORT SERVICES.

Who is the contractor on this award?

The obligated recipient is METROSTAR SYSTEMS, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $35.0 million.

What is the period of performance?

Start: 2022-10-27. End: 2025-10-26.

What is Metrostar Systems, LLC's track record with the federal government, particularly the Department of Defense?

Metrostar Systems, LLC has a history of performing IT services for the federal government, including contracts with the Department of Defense. Reviewing their past performance on similar contracts, especially those involving business information systems support or technology services for military branches, would provide insight into their reliability and capability. Data from contract databases often shows award history, contract values, and performance ratings, if available. A consistent record of successful contract completion and positive performance reviews would indicate a lower risk associated with this current award. Conversely, any history of significant performance issues, contract disputes, or terminations would warrant closer scrutiny of their ability to meet the requirements of this Marine Corps contract.

How does the per-unit cost or overall value of this contract compare to similar IT business information systems support contracts awarded by the DoD or other federal agencies?

Benchmarking this contract's value requires comparing its scope, duration, and service level agreements against similar contracts. The base period value of approximately $35 million over three years for IT business information systems support for the Marine Corps Technology Services Organization suggests an average annual value of roughly $11.7 million. When compared to other federal IT services contracts, particularly those for enterprise resource planning (ERP) support, system integration, or managed IT services within large organizations like the DoD, this figure appears to be within a reasonable range. Factors such as the complexity of the systems supported, the required security clearances, and the specific technical expertise needed can influence pricing. Without detailed service level agreements and specific task order breakdowns, a precise per-unit cost comparison is difficult, but the overall contract value seems aligned with the market for comparable federal IT support services.

What are the primary risks associated with this contract, and how are they being mitigated?

The primary risks associated with this contract include potential performance deficiencies by the contractor, unforeseen technical challenges in supporting complex Marine Corps systems, and the risk associated with limited competition (only one bid received). Mitigation strategies are in place, starting with the firm-fixed-price contract type, which shifts cost overrun risks to Metrostar Systems, LLC. The Department of the Navy and the Marine Corps Technology Services Organization will likely implement robust oversight mechanisms, including regular performance reviews, milestone tracking, and quality assurance checks, to monitor contractor performance. The limited competition risk is mitigated by the initial 'full and open' solicitation process, which aimed to attract multiple bidders, and the expectation that the government negotiated a fair price. Continued monitoring of the contractor's financial stability and technical expertise is also crucial.

How effective is the firm-fixed-price contract type in ensuring value for money for this specific IT support service?

The firm-fixed-price (FFP) contract type is generally effective in ensuring value for money for IT support services when the scope of work is well-defined and unlikely to change significantly. For this contract, supporting established business information systems, the FFP structure incentivizes Metrostar Systems, LLC to manage costs efficiently and deliver services within the agreed-upon price. This shifts the financial risk of cost overruns to the contractor, providing the government with cost certainty. Value for money is further realized if the contractor meets or exceeds performance expectations, as the price is fixed regardless of the contractor's actual costs. However, if the scope requires significant adjustments or unforeseen complexities arise, the FFP structure can sometimes lead to change order negotiations that might increase the overall cost, potentially diminishing the initial value proposition.

What are the historical spending patterns for similar IT business information systems support within the U.S. Marine Corps or the broader Department of Defense?

Historical spending patterns for IT business information systems support within the U.S. Marine Corps and the broader Department of Defense indicate a consistent and significant investment in maintaining and modernizing these critical systems. Agencies like the DoD allocate substantial portions of their IT budgets to sustainment, upgrades, and new implementations of business systems, which are essential for logistics, personnel management, financial operations, and command and control. Spending in this area often reflects the lifecycle of major IT programs, with periods of high investment during system development or major upgrades, followed by sustained spending on operations, maintenance, and support. The approximately $35 million awarded for this three-year contract aligns with the ongoing need for specialized IT support services to ensure the functionality and efficiency of these vital Marine Corps systems, reflecting a typical investment level for such critical infrastructure.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: M9549422R0013

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1856 OLD RESTON AVE, 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: $34,968,407

Exercised Options: $34,968,407

Current Obligation: $34,968,407

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: M9549422D0013

IDV Type: IDC

Timeline