VA awards $188.8M for cache licensing and maintenance, with a significant portion for IT services

Contract Overview

Contract Amount: $188,769,089 ($188.8M)

Contractor: Four Points Technology, L.L.C.

Awarding Agency: Department of Veterans Affairs

Start Date: 2007-10-01

End Date: 2012-10-27

Contract Duration: 1,853 days

Daily Burn Rate: $101.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: CACHE LICENSING AND MAINTENANCE OPTION YEAR 2. THIS ENTRY REPRESENTS THE TOTAL AWARD VALUE TO DATE.

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20171

State: Virginia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $188.8 million to FOUR POINTS TECHNOLOGY, L.L.C. for work described as: CACHE LICENSING AND MAINTENANCE OPTION YEAR 2. THIS ENTRY REPRESENTS THE TOTAL AWARD VALUE TO DATE. Key points: 1. The contract value of $188.8M over its duration suggests a substantial investment in IT infrastructure. 2. The contract was awarded under full and open competition, indicating a competitive bidding process. 3. The fixed-price contract type aims to control costs by establishing a set price for services. 4. The duration of the contract, spanning over 1800 days, points to a long-term need for these services. 5. The primary agency is the Department of Veterans Affairs, highlighting its focus on IT support for veteran services. 6. The North American Industry Classification System (NAICS) code 541519 suggests a broad scope of computer-related services.

Value Assessment

Rating: good

The total award value of $188.8M over approximately five years represents a significant investment. Benchmarking this against similar large-scale IT licensing and maintenance contracts is challenging without more specific service details. However, the firm fixed-price structure suggests an effort to manage costs predictably. The contract's duration implies a sustained need, and the value aligns with the critical nature of IT infrastructure for a large agency like the VA.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition after exclusion of sources,' which typically means the solicitation was broadly advertised, and all responsible sources were permitted to submit offers. While the specific number of bidders is not provided, this procurement method generally fosters price discovery and encourages competitive pricing. The 'exclusion of sources' aspect might indicate specific technical requirements that narrowed the field, but the overall approach suggests a robust competition.

Taxpayer Impact: A full and open competition generally benefits taxpayers by driving down prices through multiple bids, ensuring the government receives the best value for its investment.

Public Impact

Veterans will benefit from improved IT systems and services managed under this contract, potentially leading to more efficient access to healthcare and benefits. The contract supports the operational continuity of the Department of Veterans Affairs' IT infrastructure, crucial for delivering services nationwide. The geographic impact is nationwide, as the VA operates numerous facilities across the United States. The contract likely supports IT professionals and service providers, contributing to the technology sector workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on the services provided makes it difficult to assess true value for money.
The long contract duration could lead to vendor lock-in or missed opportunities for more innovative solutions.
Potential for scope creep if not managed tightly, leading to cost overruns beyond the initial award value.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
Firm fixed-price contract type provides cost certainty for the government.
The substantial award value indicates a critical and long-standing need for these IT services.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on software licensing and maintenance. The market for such services is large and competitive, with numerous vendors offering solutions for enterprise-level IT needs. The VA's spending in this area is consistent with other large federal agencies that rely heavily on robust IT systems to manage vast amounts of data and provide services to millions of citizens. Comparable spending benchmarks would typically involve looking at other large-scale IT procurements for agencies like the Department of Defense or Health and Human Services.

Small Business Impact

The contract details indicate that small business participation was not a primary set-aside consideration (ss: false, sb: false). This suggests that the primary award was likely made to a large business. However, the prime contractor may have subcontracting opportunities for small businesses to fulfill specific aspects of the IT licensing and maintenance requirements. Further analysis would be needed to determine if subcontracting goals were established and met, impacting the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Veterans Affairs contracting officers and program managers. Accountability measures are inherent in the firm fixed-price contract, requiring the contractor to deliver specified services within the agreed-upon cost. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract were suspected.

Related Government Programs

VA IT Modernization
Federal Cloud Computing Strategy
Enterprise IT Services
Software Licensing Agreements
IT Maintenance and Support Contracts

Risk Flags

Potential for technological obsolescence over the contract's long duration.
Risk of vendor lock-in due to the scale and duration of the contract.
Need for robust contract management to ensure service delivery and prevent scope creep.
Dependence on a single vendor for critical IT infrastructure components.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $188.8 million to FOUR POINTS TECHNOLOGY, L.L.C.. CACHE LICENSING AND MAINTENANCE OPTION YEAR 2. THIS ENTRY REPRESENTS THE TOTAL AWARD VALUE TO DATE.

Who is the contractor on this award?

The obligated recipient is FOUR POINTS TECHNOLOGY, L.L.C..

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $188.8 million.

What is the period of performance?

Start: 2007-10-01. End: 2012-10-27.

What specific cache licensing and maintenance services are covered under this contract, and how do they align with the VA's current IT strategy?

The provided data does not specify the exact nature of the 'cache licensing and maintenance' services. This could range from software licenses for caching solutions (e.g., database caching, web caching) to the ongoing maintenance and support for that software. To assess alignment with the VA's IT strategy, one would need to review the VA's current IT modernization plans, digital transformation initiatives, and specific technology roadmaps. Typically, such contracts support the performance and availability of critical applications and databases by ensuring efficient data retrieval and reducing latency. Understanding the specific software or hardware involved would be key to evaluating its strategic relevance.

How does the per-unit cost or pricing structure of this contract compare to industry benchmarks for similar IT services?

Without detailed pricing breakdowns or specific service metrics (e.g., cost per license, cost per support hour, cost per managed cache instance), a direct per-unit cost comparison to industry benchmarks is not feasible. The contract is a firm fixed-price award, meaning the total price is set. However, the overall value of $188.8 million over its duration suggests a significant scale. To benchmark, one would need to identify the specific software or hardware being licensed and maintained, research its market price, and compare the VA's negotiated rates against those. Factors like volume discounts, contract duration, and the level of support included would heavily influence such comparisons.

What is the track record of Four Points Technology, L.L.C. in delivering similar large-scale IT licensing and maintenance contracts to federal agencies?

Information on Four Points Technology, L.L.C.'s specific track record for this particular contract is limited to the award details provided. To assess their performance, one would need to examine their past performance evaluations on similar federal contracts, including any past performance questionnaires (PPQs) submitted during the bidding process for this or other contracts. Reviewing contract close-out reports, any contract disputes, or awards/debarments would also provide insight. A comprehensive analysis would involve searching federal procurement databases for other contracts awarded to Four Points Technology, L.L.C., noting their size, scope, agency, and performance history.

What are the potential risks associated with a long-term (1853 days) IT licensing and maintenance contract of this magnitude?

Long-term IT contracts of this magnitude carry several potential risks. Firstly, technological obsolescence is a significant concern; the technology being licensed and maintained could become outdated before the contract ends, requiring costly upgrades or replacements. Secondly, vendor lock-in can occur, making it difficult and expensive to switch providers or adopt new solutions. Thirdly, the fixed-price nature, while offering cost certainty, can lead to reduced flexibility if requirements change significantly, potentially requiring costly modifications or new contract actions. Finally, the sheer size of the contract could make it a target for security breaches or performance issues if not managed diligently by both the contractor and the agency.

How has the VA's spending on cache licensing and maintenance evolved over time, and does this award represent an increase or decrease compared to historical trends?

The provided data only pertains to a single contract award with a total value of $188.8 million. To understand historical spending trends for the VA on cache licensing and maintenance, one would need to analyze historical procurement data over several fiscal years. This would involve querying databases like FPDS for all contracts with relevant NAICS codes (e.g., 541519) and PSC codes related to software licensing and maintenance, specifically filtering for the Department of Veterans Affairs. Comparing the annual or cumulative spending across different years would reveal whether this $188.8 million award represents a typical, increased, or decreased level of investment in these services.

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 › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5160 PARKSTONE DR STE 190A, CHANTILLY, VA, 20151

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $188,797,682

Exercised Options: $188,797,682

Current Obligation: $188,769,089

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: V200P1906

IDV Type: IDC

Timeline