CBP's $368.7M IT support contract awarded to Science Applications International Corp. shows fair value despite limited competition

Contract Overview

Contract Amount: $368,704,884 ($368.7M)

Contractor: Science Applications International Corp

Awarding Agency: Department of Homeland Security

Start Date: 2018-03-14

End Date: 2021-09-14

Contract Duration: 1,280 days

Daily Burn Rate: $288.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: REQUIREMENT FOR UNITED STATES CUSTOMS AND BORDER PROTECTION (CBP), OFFICE OF INFORMATION TECHNOLOGY (OIT), TARGETING AND ANALYSIS SYSTEMS PROGRAM DIRECTORATE (TASPD) TO PROVIDE THE FULL RANGE OF OPERATIONS AND MAINTENANCE SUPPORT FOR THE CBP TASPD SUITE OF COMPUTER AND SOFTWARE APPLICATIONS

Place of Performance

Location: ALEXANDRIA, FAIRFAX County, VIRGINIA, 22315

State: Virginia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $368.7 million to SCIENCE APPLICATIONS INTERNATIONAL CORP for work described as: REQUIREMENT FOR UNITED STATES CUSTOMS AND BORDER PROTECTION (CBP), OFFICE OF INFORMATION TECHNOLOGY (OIT), TARGETING AND ANALYSIS SYSTEMS PROGRAM DIRECTORATE (TASPD) TO PROVIDE THE FULL RANGE OF OPERATIONS AND MAINTENANCE SUPPORT FOR THE CBP TASPD SUITE OF COMPUTER AND SOFTWARE A… Key points: 1. The contract's value appears reasonable when benchmarked against similar IT support services, suggesting a fair price was negotiated. 2. While the contract was competed, the limited number of bidders raises questions about the extent of price discovery. 3. The contractor has a history of performance with the government, indicating a degree of reliability for this critical IT function. 4. The IT systems supported are vital for border security operations, highlighting the program's strategic importance. 5. This contract falls within the broader IT services sector, a significant area of federal procurement. 6. The contract's duration and value suggest a substantial, long-term commitment to maintaining these critical systems.

Value Assessment

Rating: good

The contract's total value of approximately $368.7 million over its period of performance suggests a significant investment in IT operations and maintenance. Benchmarking against similar large-scale IT support contracts for federal agencies indicates that the pricing is within a reasonable range, implying good value for the services rendered. The cost per year averages around $92 million, which is competitive for comprehensive system support.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, which is the preferred method for ensuring the widest possible participation and the best possible pricing. However, the data indicates there were only four bidders, which, while not extremely limited, suggests that the competitive landscape could have been broader. This level of competition is generally sufficient to drive reasonable pricing, but a higher number of bidders could potentially lead to even more aggressive offers.

Taxpayer Impact: A full and open competition, even with a moderate number of bidders, is beneficial for taxpayers as it increases the likelihood of receiving competitive pricing and innovative solutions, preventing potential overspending.

Public Impact

The primary beneficiaries are U.S. Customs and Border Protection (CBP) and its Office of Information Technology (OIT), ensuring the operational readiness of critical targeting and analysis systems. The services delivered include comprehensive operations and maintenance support for a suite of computer and software applications essential for border security. The geographic impact is national, as these systems support CBP's nationwide mission, with a concentration of IT support likely in Virginia where the contractor is based. The contract supports a specialized IT workforce, potentially including system administrators, developers, and support personnel, contributing to the federal IT employment landscape.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in due to the comprehensive nature of the support required for a specific suite of applications.
Reliance on a single contractor for critical IT infrastructure could pose risks if the contractor experiences performance issues or financial instability.
The 'Time and Materials' contract type, while flexible, can sometimes lead to cost overruns if not closely monitored and managed.

Positive Signals

Awarded through full and open competition, indicating a structured procurement process.
The contractor, Science Applications International Corp., is a large, established entity with significant experience in government contracting.
The contract supports essential functions for national security and border protection, aligning with critical government missions.

Sector Analysis

This contract falls within the Computer Systems Design Services (NAICS 541512) sector, a large and dynamic part of the federal IT market. Federal spending in this area is substantial, driven by the need for agencies to maintain and modernize complex IT systems. Comparable contracts often involve significant dollar values, reflecting the complexity and criticality of IT operations and maintenance for agencies like CBP. The market is characterized by a mix of large system integrators and specialized IT service providers.

Small Business Impact

This contract was not set aside for small businesses and the data indicates the primary awardee is a large corporation. There is no explicit information regarding small business subcontracting plans. This suggests that opportunities for small businesses may be limited to direct subcontracting roles, if any, rather than prime contract awards. The focus is on a large-scale IT service provider capable of handling comprehensive support.

Oversight & Accountability

Oversight for this contract would typically be managed by the CBP Office of Information Technology (OIT) through contract officers and technical representatives who monitor performance and ensure compliance with contract terms. Accountability measures are embedded in the contract's performance standards and deliverables. Transparency is facilitated through contract award databases like FPDS. The Inspector General for the Department of Homeland Security would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

CBP Targeting and Analysis Systems
CBP Information Technology Operations
Department of Homeland Security IT Modernization
Federal Civilian IT Services
Large-Scale IT Operations and Maintenance Contracts

Risk Flags

Potential for cost overruns due to Time and Materials contract type.
Reliance on a single vendor for critical IT systems.
Limited number of bidders in a full and open competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $368.7 million to SCIENCE APPLICATIONS INTERNATIONAL CORP. REQUIREMENT FOR UNITED STATES CUSTOMS AND BORDER PROTECTION (CBP), OFFICE OF INFORMATION TECHNOLOGY (OIT), TARGETING AND ANALYSIS SYSTEMS PROGRAM DIRECTORATE (TASPD) TO PROVIDE THE FULL RANGE OF OPERATIONS AND MAINTENANCE SUPPORT FOR THE CBP TASPD SUITE OF COMPUTER AND SOFTWARE APPLICATIONS

Who is the contractor on this award?

The obligated recipient is SCIENCE APPLICATIONS INTERNATIONAL CORP.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $368.7 million.

What is the period of performance?

Start: 2018-03-14. End: 2021-09-14.

What is the track record of Science Applications International Corp. (SAIC) with federal IT contracts, particularly those involving operations and maintenance?

Science Applications International Corp. (SAIC) is a major government contractor with extensive experience in providing IT services, including operations and maintenance, to various federal agencies. They have a long history of supporting complex systems for defense, intelligence, and civilian sectors. SAIC's track record typically includes managing large-scale IT infrastructure, software development, cybersecurity, and system integration projects. For contracts similar to this CBP requirement, SAIC has demonstrated capabilities in maintaining mission-critical applications and ensuring system availability and performance. Their past performance is generally well-documented through federal contract databases and agency performance reviews, often indicating successful delivery on complex IT programs, though like any large contractor, specific contract performance can vary.

How does the average annual cost of this contract compare to similar IT support contracts for federal agencies of comparable size and mission scope?

The average annual cost for this contract is approximately $92 million ($368.7 million / 4 years). When compared to similar large-scale IT operations and maintenance contracts for federal agencies with significant national security or law enforcement missions, such as those within the Department of Defense or other components of the Department of Homeland Security, this figure appears to be within a competitive range. Factors influencing cost include the complexity of the systems supported, the level of service required (e.g., 24/7 support, uptime guarantees), the number of users, and the specific technologies involved. While a precise benchmark requires detailed analysis of comparable contract scopes, the $92 million annual average suggests fair market value for comprehensive IT support of critical systems.

What are the primary risks associated with a 'Time and Materials' contract type for IT operations and maintenance, and how might they be mitigated?

The primary risk with a 'Time and Materials' (T&M) contract type, like the one used here, is the potential for cost overruns. Because the contractor is reimbursed for direct labor hours at specified rates and for the actual cost of materials, there is less inherent incentive for efficiency compared to a fixed-price contract. This can lead to increased costs if work is not managed effectively or if the scope of work expands without proper controls. Mitigation strategies employed by the government include establishing strong contract oversight, setting not-to-exceed (NTE) limits, defining labor categories and rates carefully, requiring detailed timesheets and justifications for materials, and implementing performance metrics to ensure productivity. Regular reviews and audits are crucial to manage T&M contracts effectively and prevent uncontrolled cost escalation.

What is the strategic importance of the Targeting and Analysis Systems Program Directorate (TASPD) to CBP's overall mission, and how does this contract support it?

The Targeting and Analysis Systems Program Directorate (TASPD) plays a crucial role in U.S. Customs and Border Protection's (CBP) mission to secure the nation's borders while facilitating lawful trade and travel. TASPD is responsible for developing, implementing, and maintaining sophisticated IT systems that enable CBP officers to identify and interdict high-risk individuals, weapons, and illicit activities. These systems analyze vast amounts of data from various sources to provide actionable intelligence for enforcement actions. This contract, providing full-range operations and maintenance support for TASPD's suite of applications, is therefore strategically vital. It ensures the continuous availability, reliability, and performance of the IT infrastructure that underpins CBP's ability to make informed decisions, manage border risks effectively, and protect national security.

Given the contract's duration (approx. 4 years) and value, what are the historical spending patterns for similar IT support services at CBP or DHS?

Historical spending patterns for IT support services at CBP and the broader Department of Homeland Security (DHS) generally show a consistent and significant investment in maintaining and upgrading complex technological systems. Agencies like CBP rely heavily on IT for their core missions, including border security, customs enforcement, and trade facilitation. Contracts for operations and maintenance of critical systems often span multiple years and involve substantial dollar amounts, reflecting the ongoing need for system upkeep, software updates, cybersecurity measures, and user support. Spending in this category typically represents a large portion of an agency's IT budget. The $368.7 million awarded to SAIC aligns with the scale of IT investments seen in comparable large federal agencies requiring robust, continuous IT support for mission-critical operations.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Science Applications International Corporation

Address: 11720 PLAZA AMERICA DR, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $407,366,120

Exercised Options: $368,704,884

Current Obligation: $368,704,884

Subaward Activity

Number of Subawards: 19

Total Subaward Amount: $377,199,208

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS00Q09BGD0060

IDV Type: GWAC

Timeline