DoD's $43.9M MDA Systems Engineering Contract Awarded to Parsons Government Services Inc

Contract Overview

Contract Amount: $43,941,628 ($43.9M)

Contractor: Parsons Government Services Inc

Awarding Agency: Department of Defense

Start Date: 2015-04-09

End Date: 2016-08-27

Contract Duration: 506 days

Daily Burn Rate: $86.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: IGF::OT::IGF DE-01-14 MDA SYSTEMS ENGINEERING

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35898

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $43.9 million to PARSONS GOVERNMENT SERVICES INC for work described as: IGF::OT::IGF DE-01-14 MDA SYSTEMS ENGINEERING Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 3. The duration of the contract is 506 days, indicating a medium-term project. 4. The award was made to a single contractor, Parsons Government Services Inc. 5. The contract falls under Research and Development in Physical, Engineering, and Life Sciences. 6. The contract was awarded in Alabama, indicating a specific geographic focus.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without more detailed cost breakdowns and performance metrics. However, the Cost Plus Fixed Fee (CPFF) contract type inherently carries risks of cost escalation if the contractor's costs exceed initial estimates. The total award amount of $43.9 million for a 506-day period for systems engineering services needs to be compared against similar contracts for scope and complexity to determine true value for money. Without comparable data on labor hours, overhead rates, and profit margins, a definitive value assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a 'full and open competition' solicitation, which implies that all responsible sources were permitted to submit a bid. The data indicates there were 4 bids received. A competitive process with multiple bidders generally fosters price discovery and can lead to more favorable pricing for the government. The presence of four bidders suggests a reasonable level of competition for this specific requirement.

Taxpayer Impact: The full and open competition with four bidders likely resulted in a more competitive price than a sole-source or limited competition award, potentially saving taxpayer dollars.

Public Impact

The primary beneficiaries are the Department of Defense and the Missile Defense Agency, receiving critical systems engineering support. The services delivered are focused on research and development in physical, engineering, and life sciences, specifically for missile defense systems. The contract has a geographic impact in Alabama, where the work is likely performed or managed. The contract supports specialized engineering and technical workforce within the defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can incentivize contractors to incur higher costs to achieve a higher fee, potentially leading to cost overruns.
Limited transparency on specific performance metrics makes it difficult to assess the contractor's efficiency and effectiveness.
The contract duration of 506 days is relatively short for complex systems engineering, potentially leading to continuity issues if not managed well.
Lack of detailed breakdown of labor categories and rates makes it hard to benchmark against industry standards.

Positive Signals

Awarded through full and open competition, indicating a robust and fair bidding process.
The contractor, Parsons Government Services Inc., is a known entity in government contracting, suggesting a degree of established capability.
The contract supports a critical national security mission for the Missile Defense Agency.
The specific NAICS code (541712) indicates a focus on specialized R&D services.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on engineering and physical sciences. The market for defense-related R&D is substantial, driven by national security imperatives. Companies like Parsons Government Services Inc. operate in a competitive landscape where securing contracts for specialized engineering and technical services is crucial. Comparable spending benchmarks would involve analyzing other MDA contracts for systems engineering and R&D services, as well as broader DoD R&D spending in similar technological domains.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. The primary contractor, Parsons Government Services Inc., is a large business. While large businesses may engage small businesses as subcontractors on various projects, this specific contract's structure does not mandate or prioritize small business participation through a set-aside mechanism.

Oversight & Accountability

Oversight for this contract would typically be managed by the Missile Defense Agency (MDA) contracting officers and program managers. The Department of Defense has established oversight mechanisms, including contract performance reviews and financial audits, to ensure accountability. Transparency is often facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

Missile Defense Systems
Department of Defense Research and Development
Systems Engineering Services
Federal Contract Awards

Risk Flags

Cost Plus Fixed Fee contract type carries inherent risk of cost overruns.
Limited public data on specific performance metrics makes independent assessment difficult.
R&D contracts can be subject to unforeseen technical challenges impacting cost and schedule.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $43.9 million to PARSONS GOVERNMENT SERVICES INC. IGF::OT::IGF DE-01-14 MDA SYSTEMS ENGINEERING

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 $43.9 million.

What is the period of performance?

Start: 2015-04-09. End: 2016-08-27.

What is the track record of Parsons Government Services Inc. with the Department of Defense, particularly on similar systems engineering contracts?

Parsons Government Services Inc. has a significant history of contracting with the Department of Defense across various agencies and programs. They have been awarded numerous contracts for engineering, technical services, and R&D. For systems engineering specifically, their track record includes support for complex defense systems. Analyzing their past performance on similar MDA contracts, including on-time delivery, budget adherence, and technical success rates, would provide a clearer picture of their capabilities and reliability. Publicly available contract databases and performance reports (if accessible) can offer insights into their historical performance trends and any past issues or commendations received from the DoD.

How does the Cost Plus Fixed Fee (CPFF) structure of this contract compare to other systems engineering contracts awarded by the MDA?

The Cost Plus Fixed Fee (CPFF) contract type is common for R&D and complex services where the scope may evolve or is not fully defined at the outset. For systems engineering, CPFF allows for flexibility but also introduces risk. Compared to other MDA systems engineering contracts, the use of CPFF suggests a similar approach to managing projects with inherent uncertainties. However, the 'fixed fee' component aims to provide the contractor with a defined profit margin, incentivizing efficiency. A comparative analysis would examine the proportion of CPFF contracts versus other types (e.g., Firm-Fixed-Price) for similar MDA systems engineering efforts and assess the average fee percentages and cost growth experienced on those CPFF contracts.

What are the key performance indicators (KPIs) used to measure the success of this systems engineering contract?

Specific Key Performance Indicators (KPIs) for this contract are not detailed in the provided data. However, typical KPIs for systems engineering contracts in the defense sector include adherence to project timelines, meeting technical specifications and performance requirements, successful integration of system components, effective risk management, and cost control within the established fee structure. For the Missile Defense Agency, KPIs would likely be stringent, focusing on the reliability, effectiveness, and readiness of the systems being engineered. Performance would be assessed through regular technical reviews, milestone achievements, and final system validation.

What is the historical spending pattern for systems engineering services by the Missile Defense Agency?

The Missile Defense Agency (MDA) historically allocates significant funding towards systems engineering and technical support due to the complexity and critical nature of its programs. Spending patterns can fluctuate based on program lifecycles, technological advancements, and evolving threat assessments. Analyzing MDA's budget justifications and contract award data over several fiscal years would reveal trends in systems engineering expenditures. This includes the total amount spent, the types of contract vehicles used (e.g., IDIQs, specific awards), and the primary contractors involved. Such analysis would contextualize the $43.9 million award within the broader MDA spending landscape for these services.

What is the potential for cost overruns given the CPFF contract type and the nature of R&D services?

The Cost Plus Fixed Fee (CPFF) contract type inherently carries a risk of cost overruns. While the 'fixed fee' provides a ceiling on the contractor's profit, the 'cost' portion is reimbursable up to a certain limit. If the contractor incurs higher-than-expected costs in performing the R&D services, these costs are borne by the government, potentially exceeding the initial budget allocated for the 'cost' element. The nature of R&D, which often involves unforeseen technical challenges and discoveries, further increases this risk. Effective oversight, rigorous cost tracking, and proactive risk management by the MDA are crucial to mitigate potential cost overruns on this contract.

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: 4

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: $46,310,800

Exercised Options: $46,310,800

Current Obligation: $43,941,628

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HQ014710D0010

IDV Type: IDC

Timeline