DoD's $175M+ Engineering Services Contract with ADI Technology Corporation Faces Scrutiny Over Value and Competition

Contract Overview

Contract Amount: $199,372,356 ($199.4M)

Contractor: NTT Data Services Federal Government, LLC

Awarding Agency: Department of Defense

Start Date: 2002-07-03

End Date: 2013-11-30

Contract Duration: 4,168 days

Daily Burn Rate: $47.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 21

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 200210!025327!1700!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002401D7010 !A!N! !N!0011 !20020703!20030702!175344753!175344753!191692813!N!ADI TECHNOLOGY CORPORATION !1800 N BEAUREGARD ST !ALEXANDRIA !VA!22311!50000!001!11!WASHINGTON !DISTRICT OF COLUMBIA !D.C. !+000001139368!N!N!000000000000!R499!OTHER PROFESSIONAL SERVICES !S1 !SERVICES !2000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!B!M! !A!D!20060331!B! ! !A! !A!N!U!2!021!B! !Z!N!Z! ! !N!B!N!N! ! !C! !A!A!000!A!B!N! ! ! ! ! ! !0001!

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20171

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $199.4 million to NTT DATA SERVICES FEDERAL GOVERNMENT, LLC for work described as: 200210!025327!1700!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002401D7010 !A!N! !N!0011 !20020703!20030702!175344753!175344753!191692813!N!ADI TECHNOLOGY CORPORATION !1800 N BEAUREGARD ST !ALEXANDRIA !VA!22311!50000!001!11!WASHINGTON !DISTR… Key points: 1. The contract awarded to ADI Technology Corporation for engineering services has a significant value of over $175 million. 2. Competition for this contract was full and open, suggesting a potentially competitive bidding process. 3. However, the contract's duration of over 11 years and its cost-plus-fixed-fee structure raise questions about cost control and overall value. 4. The sector is Engineering Services, a critical area for defense operations.

Value Assessment

Rating: questionable

The contract's total value exceeds $175 million over an extended period. Without detailed cost breakdowns and performance metrics, it's difficult to definitively assess value for money compared to similar engineering service contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which typically allows for a broad range of bidders and can lead to better price discovery. However, the long duration might have impacted the initial price discovery.

Taxpayer Impact: While competition was intended to benefit taxpayers, the extended duration and cost-plus structure warrant close monitoring to ensure efficient use of funds.

Public Impact

Taxpayers are funding extensive engineering services for the Naval Sea Systems Command. The long contract term could mean sustained investment in specific technologies or service providers. The Department of Defense relies on these services for critical naval operations. Potential for cost overruns exists with cost-plus contracts if not managed tightly.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (over 11 years)
Cost-plus-fixed-fee pricing structure
Lack of specific performance metrics in provided data

Positive Signals

Awarded under full and open competition
Services provided to a critical defense entity (NAVSEA)

Sector Analysis

This contract falls within the Engineering Services sector, which is vital for the Department of Defense's research, development, and maintenance of naval systems. Spending benchmarks in this sector can vary widely based on project complexity and duration.

Small Business Impact

The provided data does not indicate whether small businesses were involved as subcontractors or prime contractors. Further analysis would be needed to determine small business participation.

Oversight & Accountability

The long duration of this contract necessitates robust oversight from the Naval Sea Systems Command and the Defense Contract Management Agency to ensure adherence to terms, cost control, and effective service delivery.

Related Government Programs

Engineering Services
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Extended contract duration may lead to price escalation and reduced flexibility.
Cost-plus-fixed-fee structure can incentivize higher costs if not tightly managed.
Lack of detailed service descriptions makes value assessment difficult.
Potential for contractor lock-in due to long-term engagement.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $199.4 million to NTT DATA SERVICES FEDERAL GOVERNMENT, LLC. 200210!025327!1700!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002401D7010 !A!N! !N!0011 !20020703!20030702!175344753!175344753!191692813!N!ADI TECHNOLOGY CORPORATION !1800 N BEAUREGARD ST !ALEXANDRIA !VA!22311!50000!001!11!WASHINGTON !DISTRICT OF COLUMBIA !D.C. !+000001139368!N!N!000000000000!R499!OTHER PROFESSIONAL SERVICES !S1 !SERVICES !2000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!B!M! !A!D!20060331!B

Who is the contractor on this award?

The obligated recipient is NTT DATA SERVICES FEDERAL GOVERNMENT, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $199.4 million.

What is the period of performance?

Start: 2002-07-03. End: 2013-11-30.

What specific engineering services are being provided under this contract, and how do they align with current and future naval needs?

The contract is for 'OTHER PROFESSIONAL SERVICES' with a PSC code of R499, and the NAICS code is 541330 (Engineering Services). While the specific services aren't detailed, they likely encompass design, analysis, testing, and technical support for naval systems. Alignment with future needs depends on the contract's flexibility and the agency's strategic planning.

Given the cost-plus-fixed-fee structure and long duration, what mechanisms are in place to mitigate the risk of cost overruns and ensure optimal value for taxpayers?

Cost-plus-fixed-fee contracts inherently carry a risk of cost overruns. Mitigation typically involves stringent oversight, detailed cost reporting requirements, performance incentives, and clear definition of fixed-fee parameters. The agency must actively manage these elements throughout the contract's extensive lifecycle to safeguard taxpayer funds.

How effectively did the 'full and open competition' process ensure the best possible pricing and service quality for these engineering services over the contract's lifespan?

Full and open competition is designed to foster a competitive environment leading to better pricing and quality. However, the effectiveness over an 11+ year period is contingent on the initial bid quality, the contractor's sustained performance, and the agency's ongoing contract management. Market dynamics and technological advancements over such a long period can also influence the perceived value.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 21

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Nippon Telegraph and Telephone Corporation (UEI: 690626718)

Address: 13880 DULLES CORNER LN STE 200, HERNDON, VA, 20171

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002401D7010

IDV Type: IDC

Timeline