DoD's $36.7M ENCORE II IT contract awarded to BAE Systems for R&D services

Contract Overview

Contract Amount: $36,709,577 ($36.7M)

Contractor: BAE Systems Technology Solutions & Services Inc.

Awarding Agency: Department of Defense

Start Date: 2009-06-03

End Date: 2011-12-02

Contract Duration: 912 days

Daily Burn Rate: $40.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: ENCORE II IT SOLUTIONS - CPIF

Place of Performance

Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22041

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $36.7 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. for work described as: ENCORE II IT SOLUTIONS - CPIF Key points: 1. Contract awarded for IT solutions, focusing on research and development. 2. BAE Systems, a major defense contractor, secured this award. 3. The contract type is Cost Plus Fixed Fee, indicating potential for cost overruns. 4. Performance period spans over two years, from June 2009 to December 2011. 5. The contract was awarded under the ENCORE II vehicle, a large IT services contract. 6. The NAICS code suggests a focus on physical, engineering, and life sciences R&D. 7. This award represents a portion of broader IT spending within the Department of Defense.

Value Assessment

Rating: fair

Benchmarking the value of this $36.7 million contract is challenging without specific deliverables. However, the Cost Plus Fixed Fee (CPFF) contract type can sometimes lead to higher costs compared to fixed-price contracts if not managed tightly. The award amount itself is moderate for a large IT services contract within the Department of Defense. Further analysis would require understanding the specific services rendered and comparing them to industry benchmarks for similar R&D efforts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, suggesting that multiple vendors had the opportunity to bid. The fact that it was a delivery order under the ENCORE II IDIQ vehicle implies a competitive process was followed for this specific task order. The presence of two bidders indicates some level of competition, though the exact number of proposals received is not specified.

Taxpayer Impact: A full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation.

Public Impact

The Department of Defense benefits from advanced IT solutions and research and development services. This contract supports the development of technologies relevant to national security. The services delivered likely contribute to the modernization of defense systems. The geographic impact is primarily within Virginia, where the contractor is located. Workforce implications include employment for skilled IT professionals and researchers at BAE Systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type can incentivize contractor to increase costs to increase fee.
Limited competition with only two bidders may not have resulted in the best possible pricing.
The specific R&D outcomes and their impact on DoD capabilities are not detailed.
The contract duration of over two years requires ongoing monitoring for performance and cost control.

Positive Signals

Awarded through a full and open competition, ensuring a broad range of potential offerors.
BAE Systems is a reputable contractor with significant experience in defense technology.
The ENCORE II vehicle itself was designed to streamline IT procurement through competition.
The contract supports critical research and development for the Department of Defense.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on Research and Development (R&D) services. The IT services market for the federal government is substantial, with significant spending allocated to R&D for advanced technologies. Contracts like this are crucial for maintaining technological superiority. Comparable spending benchmarks would involve looking at other R&D contracts awarded by the DoD and other federal agencies for similar types of services.

Small Business Impact

This contract does not appear to have a small business set-aside, as indicated by 'sb': false. Therefore, there are no direct subcontracting implications for small businesses mandated by this specific award. However, as a large prime contractor, BAE Systems may engage small businesses as subcontractors on a voluntary basis, depending on the project's needs and their subcontracting plans.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Information Systems Agency (DISA) and the Department of Defense. Accountability measures would be tied to the Cost Plus Fixed Fee structure, requiring detailed cost reporting and performance metrics. Transparency is facilitated through contract award databases, though specific project details and outcomes may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

ENCORE II IT Solutions
Department of Defense IT Services
Research and Development Contracts
BAE Systems Contracts

Risk Flags

Cost Plus Fixed Fee contract type can lead to cost overruns if not managed effectively.
Limited competition (2 bidders) may result in suboptimal pricing.
Scope of R&D not clearly defined in summary data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $36.7 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC.. ENCORE II IT SOLUTIONS - CPIF

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Information Systems Agency).

What is the total obligated amount?

The obligated amount is $36.7 million.

What is the period of performance?

Start: 2009-06-03. End: 2011-12-02.

What specific R&D projects were undertaken under this contract?

The provided data does not specify the exact nature of the research and development projects undertaken. The NAICS code 541712 indicates 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology),' suggesting a broad scope. Without access to the contract's statement of work or performance reports, it's impossible to detail the specific R&D activities. These could range from developing new communication technologies, cybersecurity solutions, or advanced materials for defense applications. Further investigation into contract documentation would be required to ascertain the precise R&D focus.

How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types for R&D services?

Cost Plus Fixed Fee (CPFF) contracts are common for R&D where the scope of work is not fully defined at the outset, making fixed-price contracts difficult. In a CPFF contract, the contractor is reimbursed for allowable costs plus a fixed fee representing profit. This structure incentivizes the contractor to control costs, as the fee remains constant regardless of the final cost. However, it can lead to cost growth if initial estimates are inaccurate or if the scope expands. Compared to Cost Plus Incentive Fee (CPIF), CPFF offers less flexibility for cost sharing and performance incentives. Fixed-price contracts, while offering greater cost certainty for the government, are often unsuitable for exploratory R&D due to inherent uncertainties.

What is the track record of BAE Systems in delivering similar R&D services to the DoD?

BAE Systems is a major defense contractor with extensive experience in providing a wide array of technology and R&D services to the Department of Defense and other government agencies. They have a long history of involvement in complex defense programs, including areas related to IT, systems engineering, and advanced research. While this specific contract award data doesn't detail their performance on this particular task, BAE Systems' overall profile suggests a strong capability in delivering sophisticated R&D solutions. Their track record typically involves large-scale projects, often requiring specialized expertise and adherence to stringent security and performance requirements.

What was the total spending on the ENCORE II IT Solutions vehicle during its period of performance?

The provided data focuses on a single delivery order under the ENCORE II vehicle. To determine the total spending on the ENCORE II IT Solutions vehicle, one would need to access historical contract data for the entire IDIQ contract, not just this specific award. The ENCORE II contract was a significant Indefinite Delivery/Indefinite Quantity (IDIQ) vehicle designed to provide a broad range of IT services to DoD agencies. Its total value would encompass all delivery orders issued against it during its lifespan. Information on the overall vehicle's spending would typically be available through federal procurement databases like FPDS-NG or USAspending.gov.

How does the competition level of two bidders impact price discovery for this contract?

Having only two bidders in a 'full and open' competition suggests that while the process was open, the pool of qualified and interested vendors might have been limited for this specific requirement. With only two offers, the government has less leverage to negotiate favorable terms compared to a scenario with numerous bidders. Price discovery is constrained because the government's understanding of the market price is based on only two data points. This could potentially lead to a higher-than-optimal price if one of the bidders did not aggressively price their offer, assuming the other bidder's price was accepted.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC

Address: 520 GAITHER ROAD, ROCKVILLE, MD, 20850

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

Financial Breakdown

Contract Ceiling: $36,709,577

Exercised Options: $36,709,577

Current Obligation: $36,709,577

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HC102808D2014

IDV Type: IDC

Timeline