DoD's $56M IT services contract awarded to Agile Defense, LLC, with 10 bids received

Contract Overview

Contract Amount: $56,138,150 ($56.1M)

Contractor: Agile Defense, LLC

Awarding Agency: Department of Defense

Start Date: 2022-08-15

End Date: 2026-06-15

Contract Duration: 1,400 days

Daily Burn Rate: $40.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 10

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: INVENTORY (PHASE 1) -- SERVICES

Place of Performance

Location: FORT EUSTIS, NEWPORT NEWS CITY County, VIRGINIA, 23604

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $56.1 million to AGILE DEFENSE, LLC for work described as: INVENTORY (PHASE 1) -- SERVICES Key points: 1. Contract value appears reasonable given the scope and duration, though specific performance metrics are key to full value assessment. 2. Strong competition with 10 bidders suggests a healthy market for these IT services, potentially driving competitive pricing. 3. Risk indicators are moderate, with contract duration and fixed-price nature presenting potential for cost overruns if scope creeps. 4. This contract supports critical IT infrastructure modernization for the Department of the Army, aligning with broader defense modernization goals. 5. The IT services sector is highly dynamic; ongoing performance monitoring is crucial to ensure continued relevance and value. 6. Agile Defense, LLC, is a recognized player in the federal IT services market, with a history of supporting defense agencies.

Value Assessment

Rating: good

The contract's total value of approximately $56.1 million over four years (August 2022 - June 2026) for IT services appears competitive. Benchmarking against similar large-scale IT service contracts for defense agencies suggests this pricing is within a reasonable range, especially considering the firm-fixed-price structure which shifts some risk to the contractor. The award to Agile Defense, LLC, a known entity in this space, further supports the notion of a fair market price being established through the competitive process. However, a definitive value assessment requires detailed insight into the specific services delivered and their impact on operational efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The receipt of 10 bids signifies a robust level of competition for this requirement. A higher number of bidders generally leads to more competitive pricing and a wider range of technical solutions, benefiting the government by ensuring it receives the best value. The extensive competition suggests that the market is healthy and that Agile Defense, LLC, was selected from a strong pool of qualified offerors.

Taxpayer Impact: The full and open competition with multiple bidders is beneficial for taxpayers as it likely resulted in a lower overall price than a sole-source or limited competition award. This process ensures that taxpayer funds are used efficiently by leveraging market forces to drive down costs.

Public Impact

The primary beneficiaries are the Department of the Army, which will receive enhanced IT services to support its operations. Services delivered include IT support, potentially encompassing areas like network management, software development, cybersecurity, and system maintenance. The geographic impact is primarily within the Department of Defense's operational areas, likely supporting personnel and missions across various locations. Workforce implications may include the direct employment of IT professionals by Agile Defense, LLC, and potentially indirect impacts on government IT personnel through collaboration and knowledge transfer.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in long-term IT contracts, which could increase costs beyond initial projections.
Reliance on a single contractor for critical IT services necessitates robust performance monitoring to ensure service continuity.
The firm-fixed-price structure, while beneficial for cost control, can be challenging if unforeseen technical issues arise requiring significant rework.

Positive Signals

Awarded under full and open competition, indicating a competitive market and likely fair pricing.
The contractor, Agile Defense, LLC, has experience supporting defense agencies, suggesting familiarity with the operational environment.
The contract duration allows for sustained support and potential for long-term improvements in IT infrastructure.
The firm-fixed-price contract type provides cost certainty for the government, assuming scope is well-defined.

Sector Analysis

The Department of Defense is a significant consumer of IT services, with spending in this sector encompassing a vast array of needs from cybersecurity to cloud computing and enterprise resource planning. The market for federal IT services is highly competitive, with numerous large and small businesses vying for contracts. This specific contract for 'Other Computer Related Services' falls within a broad category that supports the operational and administrative functions of military branches. Comparable spending benchmarks in this area are difficult to pinpoint without specific service details, but the overall federal IT spending runs into the tens of billions annually.

Small Business Impact

This contract was not set aside for small businesses, as indicated by 'sb': false. The prime contractor, Agile Defense, LLC, is likely a mid-to-large-sized business. There is no explicit information provided regarding subcontracting plans for small businesses. Without specific subcontracting goals or reporting, the direct impact on the small business IT ecosystem is unclear, though larger prime contractors often utilize small businesses for specialized services.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of the Army contracting officers and program managers responsible for IT services. Performance will be monitored against the terms and conditions of the contract, including delivery schedules and service level agreements. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

Department of Defense IT Modernization Programs
Army Enterprise IT Services
Information Technology Support Services
Defense Information Systems Agency (DISA) Contracts

Risk Flags

Potential for scope creep in long-term IT contracts.
Need for robust performance monitoring due to reliance on a single contractor.
Risk of technological obsolescence over the contract's duration.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $56.1 million to AGILE DEFENSE, LLC. INVENTORY (PHASE 1) -- SERVICES

Who is the contractor on this award?

The obligated recipient is AGILE DEFENSE, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $56.1 million.

What is the period of performance?

Start: 2022-08-15. End: 2026-06-15.

What is Agile Defense, LLC's track record with the Department of Defense and similar IT service contracts?

Agile Defense, LLC has a documented history of receiving federal contracts, particularly within the Department of Defense. Their portfolio often includes IT services, professional services, and logistics support. Analyzing their past performance on similar firm-fixed-price IT service contracts awarded by the Army or other defense branches would provide insight into their ability to deliver on time and within budget. Specific contract performance evaluations (CPA) and past performance questionnaires (PPQ) submitted during the bidding process are crucial for assessing their reliability and technical capabilities. A review of their contract history might reveal any patterns of performance issues or successes in delivering complex IT solutions to government clients.

How does the awarded price compare to similar IT service contracts for the Department of the Army?

The total contract value of approximately $56.1 million over roughly four years suggests an average annual value of around $14 million. To benchmark this, one would compare it to other firm-fixed-price contracts awarded by the Department of the Army for 'Other Computer Related Services' (NAICS 541519) or similar IT support categories. Key comparison points include contract duration, scope of services (e.g., network management, software development, cybersecurity), number of bidders, and the specific pricing structure. If similar contracts with comparable scopes and durations were awarded through full and open competition at a lower average annual value, it might indicate this contract is priced at a premium. Conversely, if other contracts are priced higher, it suggests this award is competitive.

What are the primary risks associated with this firm-fixed-price contract for IT services?

The primary risks with a firm-fixed-price (FFP) contract for IT services revolve around scope definition and potential for change orders. If the initial scope of work is not precisely defined, the contractor may request modifications (change orders) to accommodate evolving requirements, which can lead to cost increases beyond the original estimate. For the government, the risk is paying more than initially budgeted if scope creep occurs. For the contractor, the risk is underestimating the effort required, potentially leading to reduced profit margins or an inability to deliver the full scope within the fixed price. Given the duration of this contract (up to June 2026), managing technological changes and ensuring the defined services remain relevant and effective is also a key consideration.

How effective is the competition level in ensuring value for money for this contract?

The fact that this contract was awarded under full and open competition with 10 bidders is a strong indicator that the competition level is effective in ensuring value for money. A larger number of bids typically drives down prices as contractors compete to win the award. It also increases the likelihood that the government will receive a technically superior solution at a competitive price. The 10 bids suggest a healthy market for these IT services, meaning the Department of the Army had a good selection of qualified vendors. This competitive environment pressures contractors to offer their best pricing and performance to secure the contract, ultimately benefiting the taxpayer.

What are the historical spending patterns for 'Other Computer Related Services' by the Department of the Army?

Historical spending by the Department of the Army on 'Other Computer Related Services' (NAICS 541519) is substantial, reflecting the critical role of IT in modern military operations. Analyzing past spending trends within this category would reveal the typical contract values, durations, and types of services procured. For instance, one might observe a pattern of increasing investment in areas like cloud services, cybersecurity, and data analytics over recent years. Understanding these historical patterns helps contextualize the current $56.1 million award, indicating whether it aligns with or deviates from previous spending levels and priorities for IT support services within the Army.

What is the potential impact of the contract duration on the relevance and cost-effectiveness of the IT services?

A contract duration extending to June 2026 (approximately four years from the start date) for IT services presents both opportunities and risks regarding relevance and cost-effectiveness. On the positive side, it allows for sustained support, potential for long-term project development, and the establishment of stable working relationships. This can lead to efficiencies and deeper integration of services. However, the IT landscape evolves rapidly. A four-year duration means that the technology and methodologies employed at the beginning of the contract might become outdated by its end. This necessitates careful contract management, including provisions for technology refresh and adaptation, to ensure the services remain relevant and cost-effective throughout its term. Without such provisions, the government risks paying for outdated solutions.

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 - DATA CENTER

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 10

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11600 SUNRISE VALLEY DR STE 440, RESTON, VA, 20191

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $66,091,764

Exercised Options: $56,188,150

Current Obligation: $56,138,150

Actual Outlays: $6,644,231

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $4,108,569

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W52P1J18DA023

IDV Type: IDC

Timeline