DoD awards $35.3M for engineering support, raising questions about value and competition

Contract Overview

Contract Amount: $35,310,274 ($35.3M)

Contractor: Parsons Government Services Inc

Awarding Agency: Department of Defense

Start Date: 2014-03-22

End Date: 2016-08-27

Contract Duration: 889 days

Daily Burn Rate: $39.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: IGF::CT::IGF ENGINEERING SUPPORT CAPABILITY GROUP, DE-08-14,C3BM, TASK ORDER AWARD

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35898

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $35.3 million to PARSONS GOVERNMENT SERVICES INC for work described as: IGF::CT::IGF ENGINEERING SUPPORT CAPABILITY GROUP, DE-08-14,C3BM, TASK ORDER AWARD Key points: 1. Contract value appears high relative to duration and scope. 2. Limited public information on performance metrics and contractor track record. 3. Full and open competition was utilized, but bidder numbers are not specified. 4. The contract falls within R&D services, a sector with significant government investment. 5. Potential for cost overruns exists given the Cost Plus Fixed Fee structure. 6. Geographic concentration in Alabama warrants further investigation.

Value Assessment

Rating: fair

The contract's total value of $35.3 million over approximately 2.5 years suggests a significant investment in engineering support. Benchmarking this against similar contracts for R&D services is challenging without more detailed scope information. The Cost Plus Fixed Fee (CPFF) pricing structure, while common, can lead to higher final costs if not managed tightly. The provided data does not offer enough detail to definitively assess value for money, but the amount warrants scrutiny.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. However, the number of bidders is not specified, which is crucial for understanding the true level of competition. A robust competition typically drives down prices and improves service quality. Without knowing how many bids were received, it's difficult to assess if the pricing reflects competitive pressures effectively.

Taxpayer Impact: While full and open competition is generally favorable for taxpayers, the lack of specific bidder numbers prevents a definitive conclusion on whether the government secured the best possible price.

Public Impact

The Department of Defense, specifically the Missile Defense Agency, is the primary beneficiary, receiving specialized engineering support. Services delivered likely include research, design, analysis, and technical consultation related to missile defense systems. The geographic impact is concentrated in Alabama, where the contractor is based. The contract supports highly skilled engineering and technical jobs within the defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee structure may incentivize contractor to incur costs to maximize fee.
Limited transparency on performance metrics and deliverables.
Contract duration and value may indicate a significant, potentially long-term, need for these services.
Geographic concentration in Alabama could limit broader access to specialized talent pools.

Positive Signals

Awarded under full and open competition, suggesting a broad search for qualified contractors.
The contract supports critical national security functions within the Missile Defense Agency.
The contractor, Parsons Government Services Inc., is a known entity in government contracting.

Sector Analysis

This contract falls under the Research and Development in the Physical, Engineering, and Life Sciences sector, specifically classified under NAICS code 541712. This sector is characterized by innovation and specialized expertise, often involving significant government investment due to national security and technological advancement priorities. The Missile Defense Agency's work is a prime example of high-value R&D spending within this domain. Comparable spending benchmarks are difficult to establish without precise service definitions, but R&D contracts can range widely in value.

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside (ss: false, sb: false). This suggests that the primary competition was likely among larger, established firms. There is no explicit information on subcontracting plans for small businesses, which could represent missed opportunities for smaller players in the defense R&D ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and program management offices, potentially including the Defense Contract Management Agency (DCMA). The Inspector General's office for the DoD would have jurisdiction over investigations of fraud, waste, or abuse. Transparency is limited by the lack of publicly available performance reports or detailed scope of work.

Related Government Programs

Missile Defense Systems Engineering
Advanced Research and Development Contracts
Department of Defense R&D Spending
Engineering Consulting Services
Cost Plus Fixed Fee Contracts

Risk Flags

Cost Plus Fixed Fee structure requires diligent oversight to manage costs.
Limited public data on specific performance metrics and outcomes.
Number of bidders in full and open competition not specified.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $35.3 million to PARSONS GOVERNMENT SERVICES INC. IGF::CT::IGF ENGINEERING SUPPORT CAPABILITY GROUP, DE-08-14,C3BM, TASK ORDER AWARD

Who is the contractor on this award?

The obligated recipient is PARSONS GOVERNMENT SERVICES INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Missile Defense Agency).

What is the total obligated amount?

The obligated amount is $35.3 million.

What is the period of performance?

Start: 2014-03-22. End: 2016-08-27.

What specific research and development tasks were performed under this contract?

The provided data classifies this contract under NAICS code 541712 (Research and Development in the Physical, Engineering, and Life Sciences). While the contractor is Parsons Government Services Inc. and the agency is the Missile Defense Agency (MDA), the specific R&D tasks are not detailed. Given the MDA's mission, these tasks likely involved advanced engineering analysis, system design, prototyping, testing, and evaluation related to missile defense technologies. This could encompass areas like sensor development, interceptor technologies, command and control systems, or threat assessment modeling. Without access to the Statement of Work (SOW) or task orders, the precise nature of the R&D remains speculative but is undoubtedly tied to enhancing national missile defense capabilities.

How does the $35.3 million award compare to typical spending for similar engineering support contracts within the Missile Defense Agency?

Comparing the $35.3 million award requires context on the duration and specific services rendered. This contract spanned approximately 2.5 years (March 2014 - August 2016). For specialized R&D engineering support within a high-priority agency like the MDA, this value is not inherently excessive, especially if it involved complex system integration or cutting-edge research. However, without detailed task order breakdowns or comparisons to contracts with identical scopes, it's difficult to benchmark definitively. Agencies often award multiple task orders under larger IDIQs (Indefinite Delivery/Indefinite Quantity) contracts, and this figure represents a single task order award. A broader analysis of MDA's R&D spending portfolio would be needed for a more robust comparison.

What are the potential risks associated with the Cost Plus Fixed Fee (CPFF) contract type used for this award?

The Cost Plus Fixed Fee (CPFF) contract type presents specific risks for the government. While it allows for flexibility in R&D where exact costs may be uncertain, the 'cost-plus' element means the contractor is reimbursed for allowable costs incurred. The 'fixed fee' is negotiated upfront and represents the contractor's profit. The primary risk is that the contractor may have less incentive to control costs rigorously compared to a fixed-price contract, as their fee is fixed regardless of the final cost. If cost overruns occur due to inefficiencies or scope creep not properly managed, the government bears the burden of increased expenses. Effective oversight, detailed cost tracking, and strong program management are crucial to mitigate these risks under a CPFF arrangement.

What does the 'full and open competition' designation imply about the contractor selection process and potential value for taxpayers?

The 'full and open competition' designation signifies that the Missile Defense Agency sought offers from all responsible sources capable of meeting the contract requirements. This is generally the preferred method as it maximizes the pool of potential bidders, fostering a competitive environment. Ideally, this leads to better pricing, higher quality services, and innovative solutions. However, the effectiveness of this competition hinges on the number of bids received and the rigor of the evaluation process. Without knowing the number of bidders, we cannot definitively conclude the extent to which taxpayer value was maximized. If only a few bids were submitted, the competitive pressure might have been limited, potentially impacting the final price and terms.

Are there any indicators of contractor performance issues or successes based on historical data for Parsons Government Services Inc.?

Parsons Government Services Inc. is a subsidiary of a large, established engineering and construction firm with a long history of government contracting across various agencies, including the Department of Defense. While specific performance data for this particular $35.3 million task order is not publicly detailed, Parsons generally has a track record of performing complex engineering and technical services. However, like any large contractor, they may have faced past performance issues on other contracts, which would typically be documented in government performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS). A comprehensive review would require accessing these detailed performance records, which are often not publicly available. Based solely on the provided data, there are no immediate red flags regarding the contractor's general suitability for this type of work.

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: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HQ014709R0002

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Parsons Corporation (UEI: 030866545)

Address: 25531 COMMERCENTRE DR STE 120, LAKE FOREST, CA, 92630

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

Financial Breakdown

Contract Ceiling: $35,926,562

Exercised Options: $35,926,562

Current Obligation: $35,310,274

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HQ014710D0010

IDV Type: IDC

Timeline