Parsons Government Services awarded $114M contract for engineering services by the Department of Labor

Contract Overview

Contract Amount: $114,395,998 ($114.4M)

Contractor: Parsons Government Services Inc.

Awarding Agency: Department of Labor

Start Date: 2018-07-13

End Date: 2024-01-15

Contract Duration: 2,012 days

Daily Burn Rate: $56.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: AWARD NEW CONTRACT BASE YEAR AWARD.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20210

State: District of Columbia Government Spending

Plain-Language Summary

Department of Labor obligated $114.4 million to PARSONS GOVERNMENT SERVICES INC. for work described as: AWARD NEW CONTRACT BASE YEAR AWARD. Key points: 1. The contract value of $114.4 million over its period of performance suggests a significant investment in engineering services. 2. Competition dynamics for this contract are assessed to understand pricing efficiency and potential for taxpayer savings. 3. Risk indicators are evaluated to ensure effective project delivery and mitigate potential cost overruns or performance issues. 4. Performance context is crucial for understanding the scope and impact of the engineering services provided. 5. The contract's positioning within the broader IT and engineering services sector highlights its role in supporting federal operations.

Value Assessment

Rating: good

The award of $114.4 million for engineering services appears to be within a reasonable range for a multi-year federal contract of this nature. Benchmarking against similar contracts for engineering support within the Department of Labor or other federal agencies would provide a more precise value-for-money assessment. The firm fixed-price contract type suggests that the contractor bears the risk of cost overruns, which can be favorable for the government if well-managed.

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 offers. The presence of 4 bidders suggests a healthy level of competition, which typically leads to more competitive pricing and better value for the government. The specific details of the bidding process and the number of proposals received would further illuminate the effectiveness of the competition.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through market forces and ensuring that the government receives the best possible value for its investment.

Public Impact

The Department of Labor benefits from essential engineering services to support its administrative and operational functions. Services delivered likely encompass a range of engineering disciplines crucial for maintaining and improving federal facilities and systems. The geographic impact is primarily focused on the District of Columbia, where the contract is managed and services are likely concentrated. Workforce implications may include the direct employment of engineers and support staff by Parsons Government Services, as well as potential indirect impacts on related industries.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if not managed tightly, leading to cost increases.
Ensuring consistent quality of engineering services across the contract duration.
Dependency on a single contractor for critical engineering support.

Positive Signals

Firm fixed-price contract type mitigates cost overrun risk for the government.
Awarded through full and open competition, suggesting competitive pricing.
Long-term contract provides stability and continuity of essential services.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the broader professional services market supporting federal agencies. The market for federal engineering services is substantial, with agencies relying on specialized expertise for infrastructure, IT, and operational support. Comparable spending benchmarks would involve analyzing other large-scale engineering support contracts awarded to federal contractors across various agencies.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, and there is no explicit mention of subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem appears limited unless Parsons Government Services voluntarily engages small businesses as subcontractors. Further analysis of subcontracting plans would be needed to fully assess the impact.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Labor's contracting officers and program managers. Accountability measures are inherent in the firm fixed-price contract, requiring delivery of specified services. Transparency is generally facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Labor IT Support Services
Federal Engineering and Technical Services
Professional Services Contracts
Government Facilities Management

Risk Flags

Potential for cost overruns if scope is not well-defined.
Ensuring consistent service quality over the contract duration.
Dependency on contractor performance for critical services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $114.4 million to PARSONS GOVERNMENT SERVICES INC.. AWARD NEW CONTRACT BASE YEAR 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 Labor (Office of the Assistant Secretary for Administration and Management).

What is the total obligated amount?

The obligated amount is $114.4 million.

What is the period of performance?

Start: 2018-07-13. End: 2024-01-15.

What specific types of engineering services are covered under this contract?

The contract NAICS code 541330 indicates 'Engineering Services.' While the specific details are not provided in the summary data, this typically encompasses a broad range of services including civil, mechanical, electrical, environmental, and structural engineering. These services could be related to the design, construction, maintenance, or renovation of federal facilities, as well as technical consulting and support for the Department of Labor's various programs and IT infrastructure. A detailed review of the contract statement of work (SOW) would be necessary to ascertain the precise scope of services.

How does the $114.4 million award compare to historical spending on similar engineering services by the Department of Labor?

Without historical spending data specific to the Department of Labor's engineering services contracts, a direct comparison is difficult. However, $114.4 million over a period of approximately six years (July 2018 to January 2024) represents an average annual expenditure of roughly $19 million. This figure should be benchmarked against the agency's overall budget for facilities management, IT infrastructure, and program support to determine if it represents a significant or typical allocation. Analyzing prior contracts for similar services, if available, would provide a more robust historical context.

What are the primary risks associated with a firm fixed-price contract of this magnitude and duration?

For a firm fixed-price contract of this size and duration, primary risks include the contractor's ability to accurately estimate costs and the potential for scope creep. If the contractor underestimates costs, they may cut corners on quality or service delivery to maintain profitability. Conversely, if the government requires services beyond the original scope, change orders can lead to significant cost increases, negating some of the benefits of the fixed-price structure. Ensuring clear and detailed performance standards, robust oversight, and a well-defined SOW are crucial to mitigating these risks.

What is the track record of Parsons Government Services Inc. in delivering similar federal contracts?

Parsons Government Services Inc. is a well-established federal contractor with a history of performing various engineering, technical, and professional services for government agencies. While specific performance metrics for this particular contract are not detailed in the provided summary, the company generally has a significant presence in the federal contracting space. A comprehensive assessment of their track record would involve reviewing past performance evaluations, any reported contract disputes or terminations, and their success rate on similar large-scale government projects across different agencies.

What is the potential impact of this contract on the broader engineering services market, particularly for small businesses?

As this contract was awarded under full and open competition and does not appear to have small business set-aside provisions, its direct impact on small businesses is likely limited to potential subcontracting opportunities. The primary beneficiaries are Parsons Government Services and its direct employees. However, the existence of a large contract like this can influence market dynamics by setting benchmarks for pricing and service delivery. Small businesses in the engineering sector might compete for smaller, more specialized subcontracts or focus on other government contracts where they have a competitive advantage.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - CONSTRUCTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: ARCHITECT-ENGINEER FAR 6.102

Solicitation ID: 1630DC18R00006

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Parsons Corporation

Address: 100 W WALNUT ST, PASADENA, CA, 91124

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

Financial Breakdown

Contract Ceiling: $114,395,998

Exercised Options: $114,395,998

Current Obligation: $114,395,998

Actual Outlays: $97,323,621

Subaward Activity

Number of Subawards: 23

Total Subaward Amount: $4,970,314

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline