DoD's $33.6M contract for engineering services awarded to Northrop Grumman, with a significant portion spent on labor

Contract Overview

Contract Amount: $29,895,865 ($29.9M)

Contractor: Northrop Grumman Information Technology Inc

Awarding Agency: Department of Defense

Start Date: 2006-09-27

End Date: 2009-03-05

Contract Duration: 890 days

Daily Burn Rate: $33.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: TIME AND MATERIALS

Sector: Defense

Official Description: 200612!008937!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0702DP002 !A!N! !Y!0057 ! !20060927!20061031!064677243!016435559!016435559!N!NORTHROP GRUMMAN INFORMATION T!7575 COLSHIRE DRIVE !MC LEAN !VA!22102!24480!025!34!FORT MONMOUTH !MONMOUTH !NEW JERSEY!+000003100000!N!N!000000000000!R425!ENGINEERING TECHNICAL SERVICES !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !NOT DISCERNABLE !541330!E! !5!B!M! !A! !99990909!B! ! !A! !A!N!Y!2!004!B! !C!N!Z! ! !N!C!N! ! ! !D!D!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: MC LEAN, FAIRFAX County, VIRGINIA, 22102, UNITED STATES OF AMERICA

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $29.9 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC for work described as: 200612!008937!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0702DP002 !A!N! !Y!0057 ! !20060927!20061031!064677243!016435559!016435559!N!NORTHROP GRUMMAN INFORMATION T!7575 COLSHIRE DRIVE !MC LEAN !VA!22102!24480!025!34!FORT MONMOUTH !MONM… Key points: 1. Contract value of $33.6M for engineering and technical services. 2. Significant portion of spending allocated to labor costs. 3. Contract awarded to a large, established defense contractor. 4. Performance period spanned over 890 days. 5. Services provided under a Time and Materials contract type. 6. Contract falls under the 'Engineering Services' NAICS code.

Value Assessment

Rating: fair

The total contract value of $33.6 million for engineering and technical services appears to be within a reasonable range for a multi-year defense contract of this nature. However, without specific benchmarks for 'Engineering Technical Services' under NAICS code 541330 for the Department of Defense during that period, a precise value-for-money assessment is challenging. The contract was awarded on a Time and Materials basis, which can sometimes lead to higher costs if not closely managed, but it also offers flexibility. The obligated amount of $33.6M suggests the full value was utilized.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition,' indicating that all responsible sources were permitted to submit a bid. The data indicates there were 4 bids received. This level of competition suggests a reasonable effort to obtain competitive pricing, though the specific number of bidders (4) is moderate and doesn't necessarily guarantee the lowest possible price.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation. The presence of multiple bidders suggests that taxpayer funds were likely used more efficiently than in a sole-source scenario.

Public Impact

The Department of Defense benefits from specialized engineering and technical services. Services likely supported various defense programs and operational needs. Geographic impact is centered around Fort Monmouth, New Jersey, where services were likely performed or managed. Workforce implications include employment for engineers and technical specialists at Northrop Grumman and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type can lead to cost overruns if not managed stringently.
Lack of specific performance metrics makes it difficult to assess the effectiveness of the engineering services.
Limited information on the specific deliverables and outcomes of the engineering support.

Positive Signals

Awarded under full and open competition, suggesting a fair process.
Contract awarded to a large, reputable contractor with significant defense experience.
The contract duration of over two years indicates a sustained need for these services.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), which is a significant part of the broader professional, scientific, and technical services industry. The defense sector heavily relies on such services for research, development, and sustainment of military systems. Spending in this category can fluctuate based on defense priorities and technological advancements. Comparable spending benchmarks would typically be found within defense budget allocations for engineering support contracts.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Northrop Grumman is a large prime contractor, and while they may utilize small business subcontractors, there is no explicit information provided regarding subcontracting plans or performance in this specific contract record. The absence of a small business set-aside suggests the primary focus was on large business capabilities.

Oversight & Accountability

Oversight for this contract would have been managed by the Department of Defense, likely through the Defense Contract Management Agency (DCMA) given the 'sa' field. Accountability measures would be tied to the terms of the Time and Materials contract, including labor rates, hours worked, and adherence to scope. Transparency is limited by the available data, but contract awards are generally public record.

Related Government Programs

Defense Engineering Services
Northrop Grumman Contracts
Department of Defense IT and Technical Services
Time and Materials Contracts
Fort Monmouth Support Contracts

Risk Flags

Time and Materials contract type requires diligent oversight to control costs.
Limited detail on specific deliverables hinders performance assessment.
Contract awarded to a single large entity without explicit small business subcontracting goals mentioned.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.9 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC. 200612!008937!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0702DP002 !A!N! !Y!0057 ! !20060927!20061031!064677243!016435559!016435559!N!NORTHROP GRUMMAN INFORMATION T!7575 COLSHIRE DRIVE !MC LEAN !VA!22102!24480!025!34!FORT MONMOUTH !MONMOUTH !NEW JERSEY!+000003100000!N!N!000000000000!R425!ENGINEERING TECHNICAL SERVICES !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !NOT DISCERNABLE !541330!E! !5!B!M! !A! !999

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $29.9 million.

What is the period of performance?

Start: 2006-09-27. End: 2009-03-05.

What was the specific nature of the 'Engineering Technical Services' provided under this contract?

The provided data identifies the service as 'ENGINEERING TECHNICAL SERVICES' under NAICS code 541330. While the specific nature isn't detailed, this typically encompasses a broad range of activities including design, development, analysis, and testing of systems and components. For the Department of Defense, this could involve support for communication systems, electronic warfare, radar, or other complex military technologies. The contract was awarded to Northrop Grumman Information Technology, suggesting a focus on technical and potentially IT-related engineering aspects within the defense domain.

How does the labor cost component compare to the total contract value?

The data indicates a total contract value of $33,591,000 (br: 33591) and an obligated amount of $31,000,000 (+000003100000). The contract type is 'TIME AND MATERIALS' (pt: TIME AND MATERIALS), which inherently means labor is a primary cost driver. While the exact breakdown between labor and materials isn't explicitly provided in the abbreviated data, the significant obligated amount suggests a substantial investment in personnel hours and expertise. Without a detailed cost breakdown, it's difficult to quantify the precise labor percentage, but it is expected to be the dominant factor in a T&M contract for engineering services.

What is Northrop Grumman's track record with similar Department of Defense contracts?

Northrop Grumman is a major defense contractor with an extensive history of securing and performing large-scale contracts with the Department of Defense across various domains, including aerospace, defense electronics, and information systems. Their track record generally includes complex R&D, system integration, and sustainment services. While this specific contract was for engineering technical services, it aligns with their core competencies. Historically, large contractors like Northrop Grumman have a robust, albeit sometimes scrutinized, history of delivering on complex defense requirements, often involving significant value and long-term engagements.

Were there any performance issues or contract modifications noted during the contract period?

The provided abbreviated data does not contain specific details regarding contract modifications, performance issues, or disputes. The contract was active from September 27, 2006, to March 5, 2009, with a duration of 890 days. The obligated amount matches the total contract value, suggesting the full amount was utilized. Without access to the full contract file or performance reports, it's impossible to ascertain if there were any significant performance challenges or if the contract underwent substantial modifications beyond routine administrative adjustments.

How does the number of bidders (4) compare to typical competition levels for similar DoD engineering contracts?

For large-value Department of Defense contracts, particularly those involving specialized engineering services, a competition level with 4 bidders can be considered moderate. While 'Full and Open Competition' is the ideal, the number of actual bids received can vary significantly based on the complexity, required expertise, and market landscape. Some highly specialized or niche requirements might see fewer bidders, while broader service contracts could attract more. Four bidders suggest a reasonable level of market interest and potential for competitive pricing, but it's not exceptionally high, indicating that the market might not have been saturated with potential providers for this specific need.

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: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 4

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation (UEI: 967356127)

Address: 7575 COLSHIRE DRIVE, MC LEAN, VA, 22102

Business Categories: Category Business, Not Designated a Small Business

Parent Contract

Parent Award PIID: DAAB0702DP002

IDV Type: IDC

Timeline