DoD awards $8.26M contract for Learning Stack LMS-DL Support to Katmai Management Services LLC

Contract Overview

Contract Amount: $8,264,375 ($8.3M)

Contractor: Katmai Management Services LLC

Awarding Agency: Department of Defense

Start Date: 2023-10-23

End Date: 2028-10-22

Contract Duration: 1,826 days

Daily Burn Rate: $4.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: LEARNING STACK (LS) LMS-DL SUPPORT

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32826

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $8.3 million to KATMAI MANAGEMENT SERVICES LLC for work described as: LEARNING STACK (LS) LMS-DL SUPPORT Key points: 1. Contract awarded as a sole-source action, raising questions about potential price efficiencies. 2. The contract's duration of nearly five years suggests a long-term need for these services. 3. The Computer Systems Design Services NAICS code indicates a focus on technical expertise. 4. The Delivery Order award type suggests this is part of a larger, pre-existing contract vehicle. 5. The Cost Plus Fixed Fee pricing structure requires careful monitoring to ensure cost control.

Value Assessment

Rating: questionable

Benchmarking the value of this $8.26 million contract is challenging without comparable sole-source awards for similar Learning Management System (LMS) support services. The Cost Plus Fixed Fee (CPFF) pricing structure, while allowing for flexibility, can sometimes lead to higher costs if not managed diligently. Without competitive bidding, it's difficult to ascertain if the pricing reflects fair market value or if there are opportunities for cost savings through competition. The contract's duration of almost five years also means that potential cost overruns could accumulate significantly over its life.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor possesses the necessary qualifications, or in situations where urgency or specific circumstances preclude a competitive process. The lack of competition means that the government did not benefit from the price discovery and innovation that typically arises from a bidding process, potentially leading to less favorable pricing.

Taxpayer Impact: Taxpayers may not be receiving the best possible price for these services due to the absence of a competitive bidding process. The government's ability to negotiate favorable terms is also limited in a sole-source scenario.

Public Impact

The Department of the Navy benefits from continued support for its Learning Stack (LS) Learning Management System (LMS) and Distributed Learning (DL) capabilities. This contract ensures the ongoing operation and maintenance of critical training and education platforms for naval personnel. The services delivered are essential for the professional development and readiness of the U.S. Navy workforce. The contract's geographic impact is primarily within Florida, where the contractor is located, but the services support a nationwide naval workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential cost savings for taxpayers.
Cost Plus Fixed Fee contract type requires robust oversight to prevent cost overruns.
Lack of transparency in the sole-source justification could mask underlying issues.
Long contract duration increases exposure to potential performance degradation or scope creep.

Positive Signals

Contract awarded to a known entity, potentially ensuring continuity of service.
Focus on essential training systems suggests alignment with critical defense needs.
Delivery Order award implies it's part of an established contracting framework.

Sector Analysis

The IT services sector, particularly within government contracting, is highly competitive. However, specialized areas like the development and support of complex learning management systems can sometimes lead to limited competition, especially if specific technical expertise or existing platform integration is required. The Department of Defense is a significant spender in this area, with numerous contracts awarded for training and educational technology solutions. Benchmarks for similar IT support contracts vary widely based on scope, duration, and complexity, but a $8.26 million award over nearly five years for specialized LMS support is within a common range for such services.

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. The contractor, Katmai Management Services LLC, is identified as a small business, but the award itself does not appear to leverage small business set-aside provisions. This means that opportunities for small businesses to participate in this specific contract as prime contractors were not pursued through set-aside mechanisms. Further analysis would be needed to determine if subcontracting plans exist or are mandated.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. As a Cost Plus Fixed Fee contract, rigorous financial oversight and performance monitoring are crucial to ensure that costs remain within acceptable limits and that the contractor meets all performance requirements. Transparency regarding the sole-source justification and any subsequent modifications would be key indicators of accountability. The Inspector General's office for the Department of Defense may also have jurisdiction for audits or investigations if concerns arise regarding waste, fraud, or abuse.

Related Government Programs

Defense Human Resources Activity - Learning Management Systems
Army Training Information Systems
Air Force Learning Management Systems
Navy Enterprise Resource Planning (ERP) Systems
DoD Training and Education Technology Contracts

Risk Flags

Sole-source award lacks competitive transparency.
Cost Plus Fixed Fee requires diligent cost control and oversight.
Long contract duration may lead to technology obsolescence or scope creep.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.3 million to KATMAI MANAGEMENT SERVICES LLC. LEARNING STACK (LS) LMS-DL SUPPORT

Who is the contractor on this award?

The obligated recipient is KATMAI MANAGEMENT SERVICES 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 $8.3 million.

What is the period of performance?

Start: 2023-10-23. End: 2028-10-22.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was awarded as 'NOT AVAILABLE FOR COMPETITION,' which is a common designation for sole-source awards. However, the specific justification is not detailed in the provided data. Typically, sole-source awards are justified under circumstances such as: only one responsible source being available, urgent and compelling needs that preclude competition, or when a specific national defense requirement can only be met by a particular contractor. Without further documentation (e.g., a Justification and Approval document), the precise reason remains unknown. This lack of transparency can be a concern for ensuring fair and competitive procurement practices.

How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types for similar IT support services?

The Cost Plus Fixed Fee (CPFF) contract type is often used when the scope of work is not precisely defined or is expected to evolve, as is common in complex IT development and support. It reimburses the contractor for allowable costs plus a fixed fee representing profit. Compared to Firm-Fixed-Price (FFP) contracts, CPFF offers more flexibility but carries higher risk for the government if costs escalate beyond initial estimates. It is generally considered less cost-effective than FFP for well-defined requirements. For IT support, other common types include Time and Materials (T&M) or Labor Hour (LH), which can be more transparent for service delivery but may also lead to cost increases if not managed tightly. The choice of CPFF here suggests a need for flexibility in the LS LMS-DL support.

What is the track record of Katmai Management Services LLC with the Department of Defense?

Katmai Management Services LLC has a history of contracting with the Department of Defense. While the provided data does not detail their specific performance history on this or other contracts, their selection for this sole-source award suggests they possess capabilities deemed necessary by the Navy. A comprehensive assessment would require reviewing past performance evaluations, contract modifications, and any reported issues or successes on previous DoD engagements. Their status as a small business may also influence their contracting opportunities and the types of awards they receive.

What are the potential risks associated with the long duration (nearly 5 years) of this contract?

The nearly five-year duration of this contract presents several potential risks. Firstly, technology and requirements can change significantly over such a period, potentially making the contracted services or system outdated or less effective. Secondly, long-term contracts can reduce the government's agility to adapt to new solutions or vendors if circumstances change. Thirdly, there's an increased risk of scope creep, where the project's objectives expand beyond the original intent, leading to cost overruns. Finally, sustained reliance on a single vendor for an extended period, especially under a sole-source award, can diminish competitive pressure, potentially impacting service quality and innovation over time.

Are there any comparable IT support contracts within the DoD that can serve as a benchmark for this award?

Finding direct comparable IT support contracts for benchmarking this specific award is challenging due to its sole-source nature and specialized focus on the 'LEARNING STACK (LS) LMS-DL SUPPORT.' However, the Department of Defense awards numerous contracts for Learning Management Systems (LMS) and general IT support services under various NAICS codes (like 541512 - Computer Systems Design Services). Benchmarks would typically involve comparing contract values, durations, service levels, and pricing structures of similar LMS support contracts, ideally those awarded competitively. Without access to a broader database of DoD IT contracts, especially sole-source ones, a precise benchmark is difficult. The $8.26 million over 1826 days (approx. 5 years) suggests an average annual value of roughly $1.65 million, which is a reasonable figure for specialized IT support.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0003923R0004

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 11001 OMALLEY CENTRE DR, ANCHORAGE, AK, 99515

Business Categories: 8(a) Program Participant, Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Tribally Owned Firm, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $19,146,196

Exercised Options: $11,050,867

Current Obligation: $8,264,375

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0003923D0001

IDV Type: IDC

Timeline