Column: Comparing 8(a) STARS II and 8(a) STARS III

      The General Services Administration recently released the 8(a) STARS III Master Contract, which will provide government agencies with information technology services and services-based solutions. It is designed to support emerging technologies such as AI (Artificial Intelligence), Edge Computing, and Blockchain. History of the 8(a) STARS II Vehicle

      Awarded in 2011, the 8(a) STARS II contract has become one of the most successful technology contracts for minority-owned businesses providing IT services and services-based solutions. In fiscal 2019, more than $1.9 billion in prime obligations was awarded to 8(a) STARS II contract holders. The top 10 agencies in order of 8(a) STARS II prime obligations were:

1. State Dept.;
2. Defense Information Systems Agency (DISA);
3. Dept. of the Army (except COE Civil Program Financing);
4. Defense Dept. (DOD);
5. USDA (US Dept. of Agriculture);
6. Dept. of the Air Force;
7. Homeland Security Dept.;
8. Bureau of Consular Affairs;
9. Internal Revenue Service;
10. Bureau of Resource Management

      These agencies accounted for roughly 71% of STARS II total obligations in fiscal 2019.

Usage of 8(a) STARS II

      The government has seen a marked usage increase of the 8(a) STARS II vehicle. From fiscal 2017 to fiscal 2018 usage increased 17%, and from fiscal 2018 to fiscal 2019 there was a 15% increase. That equates to usage of approximately $10.9 billion.

      In fiscal year 2019, DOD, and associated entities, were the heaviest users of the 8(a) STARS II vehicle. With $463 million in obligations, DOD and its associated agencies comprised 24% of all obligations. The State Dept. was in second place with $229 million in obligations.

Sole-Source Awards

      In fiscal 2019, $1.8 billion of the task order awards on 8(a) STARS II were sole source awards.

      Government officials say they would have competed those task orders, but no one else could be found who could perform the work. It may be related to the government’s current situation in which it is struggling to modernize IT, and is wrestling with legacy systems that have complex and unique custom agency codes.

Comparing 8(a) STARS II and 8(a) STARS III

      For starters, the planned ceiling value of 8(a) STARS III is $50 billion. When combined with the fact that the GSA expects a 10-year period of performance for 8(a) STARS III, we can deduce that average spending would be $5 billion a year.

      That is higher than the average spending for 8(a) STARS II, which has been approximately $1.5 billion per year.

Functional Areas

      8(a) STARS III is comprised of six functional areas, compared to the four functional areas on 8(a) STARS II. Bidders will select and submit past performance projects for the following functional areas:

1. FA1: 541511 Custom Computer Programming Services
2. FA2: 541512 Computer Systems Design Services
3. FA3: 541513 Computer Facilities Management Services
4. FA4: 541519 Other Computer Related Services
5. FA5: 518210 Data Processing, Hosting, and Related Services (new)
6. FA6: Emerging Technology-focused IT Services (new)

Additional Details for 8(a) STARS III

      There is a preference for performance-based fixed price task orders. GSA also is not allowing protests under $10 million at the task order level.

      Sole-source task orders will be allowed up to the 8(a) competition threshold of $4 million and must include two eligible company bids that are fair market price. Sole source task orders are also permitted if a company is owned by a Native American tribe or Alaska Native corporation.

Partnering

      If you are considering a teaming arrangement for 8(a) STARS III, note that at least 50% of the services or supplies have to be provided by the winning prime contractor. Joint Ventures (JV) are permitted. Previously, on 8(a) STARS II, JVs had a small footprint of $137 million.

Winning 8(a) STARS III

      To be eligible for a spot on this vehicle, contractors must agree with the terms and conditions of each proposal request’s requirements. Historically, GSA has not been a proponent of companies asking for changes or exceptions. Proposals must be technically acceptable, align with the functional areas and offer a fair and reasonable price. Determination of reasonable price is done by averaging the prices presented and then disqualifying outliers.

      You must also provide one to three examples of relevant experience for each functional area that is bid. You cannot use the same project as an example for more than one functional area. You can use government or commercial experience, which can prove helpful. Each project presented must be $100,000 or more and have received a satisfactory or better performance rating.

OST is an experienced provider of assembling successful STARS II bid packages and is well prepared for STARS III. Please contact Rick Windon rwindon@ostglobalsolutions.com to discuss your unique needs.

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Column: Comparing 8(a) STARS II and 8(a) STARS III

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