XTAR LLC's $28M satellite telecommunications contract shows a long duration with a single award
Contract Overview
Contract Amount: $27,980,161 ($28.0M)
Contractor: Xtar LLC
Awarding Agency: Department of State
Start Date: 2006-04-13
End Date: 2014-04-28
Contract Duration: 2,937 days
Daily Burn Rate: $9.5K/day
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: SAT COMMUNICATION
Place of Performance
Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850
State: Maryland Government Spending
Plain-Language Summary
Department of State obligated $28.0 million to XTAR LLC for work described as: SAT COMMUNICATION Key points: 1. Contract awarded for satellite telecommunications services. 2. Long contract duration of approximately 8 years. 3. Single award indicates potential for limited competition. 4. Firm Fixed Price contract type suggests predictable costs. 5. Services primarily delivered in Maryland. 6. Contract falls under the Satellite Telecommunications NAICS code.
Value Assessment
Rating: fair
The total value of $27.98 million over nearly 8 years averages to approximately $3.5 million per year. Without specific benchmarks for satellite telecommunications services of this nature, it is difficult to definitively assess value for money. The firm fixed price structure provides cost certainty, but the lack of competitive bidding in the award process may have impacted the final price. Further analysis would require comparison to similar government satellite communication contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded as a sole-source contract, meaning only one vendor was solicited. This approach is typically used when specific capabilities or circumstances necessitate a single provider. The lack of competition means that price discovery through market forces was not a factor in this award, potentially leading to higher costs for the government compared to a competitively bid contract.
Taxpayer Impact: Sole-source awards can result in taxpayers paying a premium as there was no opportunity for multiple vendors to bid and drive down prices through competition.
Public Impact
Provides essential satellite telecommunications services to the Department of State. Ensures continuity of communication for government operations. Services are geographically concentrated in Maryland. Supports the operational needs of government agencies reliant on satellite connectivity.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competitive pricing opportunities.
- Long contract duration may not reflect current market pricing.
- Lack of transparency in the sole-source justification.
Positive Signals
- Firm Fixed Price contract provides cost predictability.
- Long-term award suggests a stable and reliable service provider.
- Specific NAICS code indicates specialized service delivery.
Sector Analysis
The satellite telecommunications sector is critical for government operations, providing essential communication links for various agencies. This contract, valued at approximately $28 million over its lifespan, fits within the broader landscape of government spending on communication infrastructure. While specific market size data for this niche is not provided, the government is a significant consumer of satellite services, often relying on specialized providers for secure and reliable connectivity.
Small Business Impact
There is no indication that this contract included small business set-asides. As a sole-source award to XTAR LLC, it is unlikely that subcontracting opportunities for small businesses were a primary consideration or requirement within the contract's structure. This contract does not appear to directly contribute to the small business ecosystem.
Oversight & Accountability
Oversight for this contract would typically fall under the Department of State's contracting and program management offices. As a sole-source award, the justification and procurement process would be subject to internal review and potentially audits by the Government Accountability Office (GAO) or the Department of State's Inspector General. Transparency is limited due to the sole-source nature, but contract performance data should be available through federal procurement databases.
Related Government Programs
- Department of Defense Satellite Communications
- Federal Agency Telecommunications Services
- Government Wide Acquisition Contracts (GWACs) for IT Services
Risk Flags
- Sole-source award may indicate lack of competition.
- Long contract duration could lead to outdated technology or pricing.
- Lack of detailed performance metrics makes effectiveness assessment difficult.
Tags
satellite-telecommunications, department-of-state, maryland, firm-fixed-price, sole-source, it-services, long-term-contract, xtar-llc
Frequently Asked Questions
What is this federal contract paying for?
Department of State awarded $28.0 million to XTAR LLC. SAT COMMUNICATION
Who is the contractor on this award?
The obligated recipient is XTAR LLC.
Which agency awarded this contract?
Awarding agency: Department of State (Department of State).
What is the total obligated amount?
The obligated amount is $28.0 million.
What is the period of performance?
Start: 2006-04-13. End: 2014-04-28.
What is the track record of XTAR LLC in providing satellite telecommunications services to the government?
XTAR LLC was awarded this sole-source contract for satellite telecommunications services by the Department of State, valued at approximately $28 million and spanning from April 2006 to April 2014. This indicates a history of providing such services to a federal agency. Further details on their performance, other contracts, and overall track record would require a deeper dive into federal procurement databases and potentially contractor performance assessment reports (CPARS). The long duration of this specific contract suggests a level of satisfaction or necessity from the awarding agency, but without more data, a comprehensive assessment of their track record is limited.
How does the pricing of this contract compare to similar satellite telecommunications contracts?
Direct comparison of pricing for this contract is challenging due to its sole-source nature and the specific, potentially unique, requirements of satellite telecommunications. Without access to detailed service level agreements, bandwidth specifications, and orbital slot usage, benchmarking against other government contracts is difficult. Typically, competitively procured contracts offer better price discovery. The firm fixed price structure provides cost certainty for the government, but the absence of competition means there's no direct market validation of the price paid. Analysis would require identifying comparable sole-source or competitively awarded contracts for similar satellite services.
What are the primary risks associated with this sole-source satellite telecommunications contract?
The primary risk associated with this sole-source contract is the potential for inflated pricing due to the lack of competition. Taxpayers may have paid more than necessary. Another risk is vendor lock-in, where the government becomes dependent on a single provider, potentially limiting future flexibility or access to more cost-effective solutions. Furthermore, if XTAR LLC's capabilities were highly specialized, there's a risk associated with the continuity of service if the company faces financial or operational difficulties. The long duration also presents a risk of the technology or service becoming outdated before the contract concludes.
How effective was this contract in meeting the Department of State's satellite telecommunications needs?
The effectiveness of this contract in meeting the Department of State's needs is suggested by its long duration (approximately 8 years) and the fact that it was a sole-source award, implying a specific need that XTAR LLC was uniquely positioned to fulfill. However, a definitive assessment of effectiveness would require evaluating performance metrics, service uptime, data throughput, and user satisfaction, which are not detailed in the provided data. The contract's completion without apparent major issues would indicate a degree of effectiveness, but without specific performance data, it remains an assumption.
What were the historical spending patterns for satellite telecommunications by the Department of State prior to and during this contract?
The provided data focuses solely on this specific contract awarded in 2006. To understand historical spending patterns, one would need to analyze the Department of State's procurement data for satellite telecommunications in the years preceding 2006 and compare it to spending during the contract's term (2006-2014) and subsequent periods. This would involve examining the number of contracts awarded, the total dollar amounts spent, and the types of competition utilized (e.g., sole-source vs. competitive). Without this broader dataset, it's impossible to establish historical spending trends or contextualize this $28 million contract within the department's overall telecommunications budget.
What is the significance of the 'MD' contract status code?
The contract status code 'MD' typically signifies 'Modifying' or 'Modified'. In the context of federal procurement, this indicates that the contract has undergone modifications since its initial award. These modifications could pertain to changes in scope, duration, funding, or other terms and conditions. For this specific contract, it suggests that the original agreement was altered at some point during its lifecycle. Understanding the nature and impact of these modifications would require reviewing the specific modification documents associated with the contract.
Industry Classification
NAICS: Information › Satellite Telecommunications › Satellite Telecommunications
Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES
Contractor Details
Address: 2400 RESEARCH BLVD., ROCKVILLE, MD, 08
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $27,980,161
Exercised Options: $27,980,161
Current Obligation: $27,980,161
Parent Contract
Parent Award PIID: SDTSPO05D0001
IDV Type: IDC
Timeline
Start Date: 2006-04-13
Current End Date: 2014-04-28
Potential End Date: 2014-04-28 00:00:00
Last Modified: 2014-09-05
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