Army awards $608M contract for professional services, with a significant portion for Russia-related support
Contract Overview
Contract Amount: $608,314,312 ($608.3M)
Contractor: Parsons Government Services International Inc.
Awarding Agency: Department of Defense
Start Date: 2003-04-01
End Date: 2012-06-30
Contract Duration: 3,378 days
Daily Burn Rate: $180.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Official Description: 200307!000762!2100!CA87 !U.S. ARMY ENGINEER AND SUPPORT !DACA8797D0008 !A!N! !N!0033 !20030401!20030319!001026447!001026447!030866545!N!PARSONS DELAWARE INC !100 WEST WALNUT STREET !PASADENA !CA!91124!* !* !RS!* !* !RUSSIA !+000062737432!N!N!000000000000!R499!OTHER PROFESSIONAL SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!A!S! ! ! !99990909!B! ! !A! !A!U!R!2!003!B! !Z!Y!Z! ! !N!M!U! ! ! ! ! !A!A!000!A!B!N! ! ! ! ! ! !0001! !
Plain-Language Summary
Department of Defense obligated $608.3 million to PARSONS GOVERNMENT SERVICES INTERNATIONAL INC. for work described as: 200307!000762!2100!CA87 !U.S. ARMY ENGINEER AND SUPPORT !DACA8797D0008 !A!N! !N!0033 !20030401!20030319!001026447!001026447!030866545!N!PARSONS DELAWARE INC !100 WEST WALNUT STREET !PASADENA !CA!91124!* !* !RS!* !* … Key points: 1. Contract awarded for 'Other Professional Services' with a substantial value, indicating a need for specialized expertise. 2. A notable portion of the contract value is linked to support for Russia, raising questions about geopolitical implications and risk. 3. The contract spans over a decade, suggesting a long-term requirement for the services provided. 4. Awarded under full and open competition, implying a robust bidding process. 5. The contract type is 'Cost Plus Award Fee,' which incentivizes contractor performance but can lead to higher costs if not managed carefully. 6. The primary contractor is Parsons Delaware Inc., a known entity in government contracting.
Value Assessment
Rating: questionable
The total award amount of $608,314,311.64 over a period of approximately 10 years represents a significant investment. While the contract was competitively awarded, the specific nature of the services, particularly those related to Russia, warrants closer scrutiny regarding value for money and potential risks. Benchmarking this against similar 'Other Professional Services' contracts, especially those with international components or geopolitical sensitivities, would be crucial for a definitive value assessment. The Cost Plus Award Fee structure necessitates careful oversight to ensure costs remain reasonable and performance targets are met efficiently.
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 were likely solicited and considered. The presence of three bidders suggests a reasonable level of competition for these specialized services. A competitive process generally helps in price discovery and can lead to more favorable terms for the government. However, the specific nature of the services, particularly those involving international or sensitive regions, might limit the pool of qualified bidders.
Taxpayer Impact: The full and open competition suggests that taxpayers benefited from a process designed to solicit the best offers, potentially leading to cost savings compared to a sole-source award.
Public Impact
The U.S. Army is the primary beneficiary, receiving essential professional services. Services delivered likely encompass a range of technical, engineering, or management support critical to Army operations. A significant portion of the contract value is allocated to support related to Russia, implying services are being rendered in or concerning that region. The long duration of the contract suggests a sustained need for these services, potentially impacting workforce planning and resource allocation within the Army.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Geopolitical risk associated with services in or concerning Russia.
- Potential for cost overruns with Cost Plus Award Fee contract type if not managed stringently.
- Dependence on a single contractor for a decade-long requirement.
- Lack of specific detail on the nature of 'Other Professional Services' and their direct impact.
Positive Signals
- Awarded through full and open competition, indicating a competitive bidding process.
- Contractor (Parsons) has a history of government contracting, suggesting experience.
- Long contract duration implies a stable and predictable service delivery model.
- Clear identification of the contracting agency (Department of the Army) and primary contractor.
Sector Analysis
This contract falls under the broad category of professional services, which is a significant sector within federal procurement. The 'Other Professional Services' classification (NAICS 541330 - Engineering Services, or similar) often includes specialized engineering, architectural, management, and consulting services. The U.S. government is a major consumer of such services, particularly for defense, infrastructure, and international affairs. The substantial value of this contract, coupled with its long duration, indicates a critical and ongoing need within the Department of Defense. Comparable spending benchmarks would typically be found within large-scale engineering, logistics, or program management contracts awarded to major defense contractors.
Small Business Impact
The provided data does not indicate any specific small business set-aside provisions for this contract. The prime contractor, Parsons Delaware Inc., is a large entity. There is no information on subcontracting plans or performance related to small businesses. Therefore, the direct impact on the small business ecosystem is not discernible from this data, and it's unlikely to have a significant positive impact unless substantial subcontracting opportunities are pursued.
Oversight & Accountability
Oversight for this contract would primarily reside with the U.S. Army Corps of Engineers, given the 'DACA' contract prefix. The 'Cost Plus Award Fee' (CPAF) structure necessitates robust oversight to monitor costs, evaluate performance against award criteria, and ensure fair and reasonable pricing. Transparency regarding the specific services rendered, especially those related to Russia, would be crucial for public accountability. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to this contract.
Related Government Programs
- Department of Defense Professional Services Contracts
- Army Engineering and Support Contracts
- International Support Services
- Contracts with Russia-related components
- Cost Plus Award Fee Contracts
Risk Flags
- Geopolitical Risk (Russia)
- Cost Control (CPAF)
- Long-Term Contract Management
- Service Specificity (Opaque)
Tags
department-of-defense, department-of-the-army, professional-services, engineering-services, cost-plus-award-fee, full-and-open-competition, long-term-contract, russia-related, parsons-delaware-inc, delivery-order, usa
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $608.3 million to PARSONS GOVERNMENT SERVICES INTERNATIONAL INC.. 200307!000762!2100!CA87 !U.S. ARMY ENGINEER AND SUPPORT !DACA8797D0008 !A!N! !N!0033 !20030401!20030319!001026447!001026447!030866545!N!PARSONS DELAWARE INC !100 WEST WALNUT STREET !PASADENA !CA!91124!* !* !RS!* !* !RUSSIA !+000062737432!N!N!000000000000!R499!OTHER PROFESSIONAL SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!A!S! ! ! !99990909!B
Who is the contractor on this award?
The obligated recipient is PARSONS GOVERNMENT SERVICES INTERNATIONAL INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $608.3 million.
What is the period of performance?
Start: 2003-04-01. End: 2012-06-30.
What specific 'Other Professional Services' are being provided under this contract, particularly those related to Russia?
The provided data classifies the service under 'OTHER PROFESSIONAL SERVICES' (PSC R499) and NAICS code 541330 (Engineering Services). However, the specific nature of these services, especially those designated for Russia, is not detailed. Given the contracting agency is the U.S. Army Engineer and Support Center, these services could range from engineering design, construction management, technical consulting, environmental services, or program management support. The Russia-specific component is particularly opaque and could relate to legacy projects, international cooperation efforts, or specific geopolitical requirements. Without further classification or declassification, the exact services remain unclear, making a precise assessment of their necessity and value difficult.
How does the $608 million contract value compare to similar long-term professional services contracts awarded by the Army or DoD?
A $608 million contract over approximately 10 years for professional services is substantial, placing it among significant long-term engagements. To benchmark effectively, one would compare it to other large-scale engineering, technical support, or program management contracts awarded by the Department of Defense. For instance, similar contracts might involve base operations support, major weapon system development support, or large infrastructure projects. The key differentiating factors here are the 'Other Professional Services' classification and the explicit mention of Russia-related support. Contracts of this magnitude often involve complex requirements and a broad scope, necessitating extensive oversight. Without specific details on the service scope, direct comparison is challenging, but the overall value indicates a critical, long-duration requirement.
What are the primary risks associated with a Cost Plus Award Fee (CPAF) contract of this magnitude and duration?
The primary risks with a CPAF contract of this scale ($608M over ~10 years) revolve around cost control and performance management. CPAF contracts offer incentives for exceeding performance targets, which can lead to higher costs if the award fee criteria are not tightly defined and rigorously assessed. The government risks paying a premium if the contractor achieves high performance ratings that are not fully justified by demonstrable value or efficiency. Furthermore, the long duration increases the potential for scope creep, unforeseen cost increases (inflation, material costs), and contractor performance degradation over time. Robust government oversight, clear performance metrics, and stringent financial auditing are essential to mitigate these risks and ensure the contractor delivers value commensurate with the fees paid.
What is the strategic significance of a contract with a substantial component for Russia, awarded by the U.S. Army?
The strategic significance of a U.S. Army contract with a substantial component for Russia is complex and potentially sensitive, especially given fluctuating geopolitical relations. Historically, such contracts might have supported arms control verification, environmental remediation, infrastructure development in shared interest areas, or specific security cooperation initiatives. However, in the current geopolitical climate, the rationale requires careful examination. It could represent legacy commitments, specialized technical support for ongoing operations in the region, or engagement in areas where U.S. expertise is deemed critical despite broader political tensions. The specific nature of the services and the strategic objectives they serve would dictate the true significance and potential risks involved.
How has Parsons Delaware Inc. performed on previous government contracts, particularly those of similar scope or complexity?
Parsons Delaware Inc., as part of the larger Parsons Corporation, has a significant track record in government contracting, including extensive work with the Department of Defense and other federal agencies. They are known for providing engineering, construction, and technical services for complex projects, including infrastructure, environmental, and defense-related initiatives. Information on their past performance, including any past performance ratings, contract awards, and potential disputes or challenges, would typically be available through federal procurement databases like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS). A detailed review of their history would reveal their capacity to manage large, long-term contracts and their adherence to cost, schedule, and performance requirements.
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Parsons Corporation (UEI: 030866545)
Address: 100 W WALNUT ST, PASADENA, CA, 91124
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: DACA8797D0008
IDV Type: IDC
Timeline
Start Date: 2003-04-01
Current End Date: 2012-06-30
Potential End Date: 2012-06-30 00:00:00
Last Modified: 2016-05-26
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