Naval Sea Systems Command contract for engineering services awarded to Anteon Corporation for over $324 million

Contract Overview

Contract Amount: $324,113,177 ($324.1M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2004-03-31

End Date: 2018-08-31

Contract Duration: 5,266 days

Daily Burn Rate: $61.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 200406!042684!1700!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002401D7013 !A!N! !Y!0021 ! !20040331!20060330!067641597!067641597!099312725!N!ANTEON CORPORATION !3211 JERMANTOWN RD, STE 70!FAIRFAX !VA!22030!50000!001!11!WASHINGTON !DISTRICT OF COLUMBIA !D.C. !+000003056002!N!N!000000000000!R499!OTHER PROFESSIONAL SERVICES !S1 !SERVICES !000 !* !541330!E! !5!B!M! !A!D!20060331!B! ! !A! !A!N!U!2!021!B! !Z!N!Z! ! !N!C!N! ! ! !C!C!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $324.1 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: 200406!042684!1700!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002401D7013 !A!N! !Y!0021 ! !20040331!20060330!067641597!067641597!099312725!N!ANTEON CORPORATION !3211 JERMANTOWN RD, STE 70!FAIRFAX !VA!22030!50000!001!11!WASHINGTON !DIST… Key points: 1. Contract value exceeds $324 million, indicating a significant investment in engineering services. 2. Awarded under full and open competition, suggesting a robust bidding process. 3. The contract duration of over 14 years (5266 days) points to a long-term need for these services. 4. The primary place of performance is Virginia, a hub for defense contracting. 5. The contract type is Cost Plus Fixed Fee, which can incentivize cost control but also carries inherent risks. 6. The North American Industry Classification System (NAICS) code 541330 signifies engineering services, a critical component of naval operations.

Value Assessment

Rating: fair

The total award amount of $324,113,177.22 for engineering services is substantial. Benchmarking this against similar contracts for naval engineering support is challenging without more specific service details. However, the Cost Plus Fixed Fee (CPFF) contract type, while common, can lead to higher costs compared to fixed-price contracts if not managed carefully. The duration of the contract (over 14 years) also suggests a potentially high cumulative cost, making value for money a key consideration throughout its life.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to compete. The presence of a competitive bidding process is generally positive for price discovery and ensuring the government receives competitive pricing. The data does not specify the number of bids received, which would provide further insight into the intensity of the competition.

Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down prices through market forces, leading to more efficient use of public funds.

Public Impact

The primary beneficiary is the Department of the Navy, receiving essential engineering services for its operations. Services delivered likely include design, development, testing, and technical support for naval systems. The place of performance is primarily Virginia, supporting the local economy and defense industry workforce. This contract supports a specialized workforce of engineers and technical professionals within the defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can lead to cost overruns if not meticulously managed.
The extended duration of the contract raises concerns about long-term cost efficiency and potential for scope creep.
Lack of specific details on the number of bidders limits the assessment of competitive intensity.

Positive Signals

Awarded through full and open competition, suggesting a fair and accessible bidding environment.
The contract supports critical naval engineering functions, aligning with national defense objectives.
The primary place of performance in Virginia supports a significant defense industry hub.

Sector Analysis

This contract falls within the Engineering Services sector, a vital part of the broader professional services industry supporting government and defense needs. The market for defense engineering services is substantial, driven by the continuous need for modernization, maintenance, and development of complex military systems. Comparable spending benchmarks would typically be found within the Department of Defense's overall procurement of engineering and technical support services, often measured in billions of dollars annually across various agencies and commands.

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 specifically mandated for small businesses through this award. The primary contractor, Anteon Corporation, would determine its own subcontracting strategy, which may or may not involve small business participation.

Oversight & Accountability

Oversight for this contract would primarily reside with the Naval Sea Systems Command (NAVSEA) contracting officers and program managers. Accountability measures are inherent in the Cost Plus Fixed Fee structure, requiring detailed reporting and justification of costs. Transparency is facilitated through contract awards databases, though specific performance metrics and detailed cost breakdowns may not always be publicly available. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Naval Sea Systems Command (NAVSEA) Contracts
Department of Defense Engineering Services
Cost Plus Fixed Fee Contracts
Professional Services Contracts
Defense Industry Support Services

Risk Flags

Cost Overrun Risk
Long-Term Contract Management
Potential for Inefficiency in CPFF Structure
Scope Creep Potential

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $324.1 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. 200406!042684!1700!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002401D7013 !A!N! !Y!0021 ! !20040331!20060330!067641597!067641597!099312725!N!ANTEON CORPORATION !3211 JERMANTOWN RD, STE 70!FAIRFAX !VA!22030!50000!001!11!WASHINGTON !DISTRICT OF COLUMBIA !D.C. !+000003056002!N!N!000000000000!R499!OTHER PROFESSIONAL SERVICES !S1 !SERVICES !000 !* !541330!E! !5!B!M! !A!D!200

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $324.1 million.

What is the period of performance?

Start: 2004-03-31. End: 2018-08-31.

What is the track record of Anteon Corporation in performing similar large-scale engineering contracts for the Department of Defense?

Anteon Corporation, prior to its acquisition by General Dynamics in 2006, had a significant track record in providing IT and engineering services to the U.S. military. This specific contract with NAVSEA for engineering services was a substantial award, reflecting their capability in this domain. Their portfolio often included systems engineering, integration, and technical support for naval platforms. Analyzing their performance on this and other contracts would involve reviewing past performance evaluations, any contract disputes or modifications, and their ability to meet technical and schedule requirements. Post-acquisition, the capabilities and contracts were integrated into General Dynamics' broader offerings, making it important to consider the entity's evolution.

How does the awarded amount of over $324 million compare to typical engineering service contracts for naval systems?

An award of over $324 million for engineering services is considered a large contract, particularly within the defense sector. Naval systems are inherently complex and require extensive engineering support throughout their lifecycle, from design and development to sustainment and upgrades. Contracts of this magnitude are not uncommon for major defense programs or platform support. To provide a precise comparison, one would need to benchmark against contracts for similar naval platforms (e.g., aircraft carriers, submarines, destroyers) or specific system types (e.g., combat systems, propulsion systems). However, generally speaking, this figure represents a significant investment indicative of substantial engineering requirements.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract of this duration?

The primary risks associated with a CPFF contract of this duration (over 14 years) revolve around cost control and potential inefficiencies. For the government, the risk is that the contractor may not be sufficiently incentivized to control costs, as the fee is fixed regardless of the final cost. This can lead to cost overruns if the initial cost estimates are inaccurate or if unforeseen issues arise. For the contractor, the risk lies in underestimating the effort required, which could reduce their profit margin on the fixed fee. The extended duration amplifies these risks, as market conditions, technological requirements, and personnel costs can change significantly over such a long period, potentially necessitating contract modifications or leading to disputes.

What is the estimated value of this contract on an annual basis, and how does it compare to other defense engineering spending?

The total award value is $324,113,177.22 over a period of approximately 5266 days (roughly 14.4 years). This averages out to approximately $22.5 million per year. This annual figure provides a more digestible metric for comparison. Defense engineering spending is a vast category, with the Department of Defense obligating hundreds of billions of dollars annually across all services and agencies. While $22.5 million per year is a substantial sum for a single contract, it represents a small fraction of the total defense engineering budget. Comparisons would be most meaningful when looking at other contracts for similar types of engineering services or support for comparable naval assets.

How does the place of performance in Virginia influence the contract's execution and cost?

Virginia has a high concentration of defense contractors and a skilled workforce experienced in supporting naval and other military operations. This proximity can facilitate collaboration, communication, and access to specialized talent, potentially leading to more efficient execution. However, the cost of labor and overhead in the Washington D.C. metropolitan area and surrounding Virginia regions is generally higher than in many other parts of the country. This could translate to higher direct labor rates and indirect costs, which are factored into the CPFF structure. The government benefits from established infrastructure and expertise but may incur higher operational costs due to the location.

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

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002404R7013

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 3211 JERMANTOWN RD, STE 70, FAIRFAX, VA, 22030

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $169,213

Exercised Options: $169,213

Current Obligation: $324,113,177

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002401D7013

IDV Type: IDC

Timeline