Lockheed Martin awarded $53.2M contract for IT systems engineering and technical assistance by USDA's OCFO

Contract Overview

Contract Amount: $53,233,068 ($53.2M)

Contractor: Lockheed Martin Services, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2011-08-19

End Date: 2017-02-21

Contract Duration: 2,013 days

Daily Burn Rate: $26.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: SYSTEMS ENGINEERING AND TECHNICAL ASSISTANCE (SETA)

Place of Performance

Location: NEW ORLEANS, ORLEANS County, LOUISIANA, 70129

State: Louisiana Government Spending

Plain-Language Summary

Department of Agriculture obligated $53.2 million to LOCKHEED MARTIN SERVICES, INC. for work described as: SYSTEMS ENGINEERING AND TECHNICAL ASSISTANCE (SETA) Key points: 1. Contract value represents a significant investment in IT support services. 2. The contract was awarded through full and open competition, suggesting a competitive bidding process. 3. The time and materials pricing structure may pose a risk for cost overruns if not managed carefully. 4. The contract duration of over five years indicates a long-term need for these services. 5. The specific NAICS code (541512) points to a focus on computer systems design. 6. The award was a delivery order, implying it was part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract.

Value Assessment

Rating: fair

The contract value of $53.2 million over approximately five years suggests a substantial investment in IT support. Benchmarking this against similar SETA contracts is challenging without more specific service details. The time and materials (T&M) pricing model, while flexible, can lead to higher costs compared to fixed-price contracts if not closely monitored. The average annual value is around $10.6 million, which appears within a reasonable range for large-scale IT support for a federal agency of this size, but the T&M structure warrants scrutiny for value.

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 bids. The presence of multiple bidders (implied by 'full and open') generally fosters price discovery and can lead to more competitive pricing. However, the specific number of bidders is not provided, which limits a deeper analysis of the competitive intensity. The fact that it was competed suggests the agency sought the best value through a broad solicitation.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing inherent in a full and open competition. This process aims to ensure that the government receives services at a fair market price, preventing inflated costs that could arise from less competitive arrangements.

Public Impact

The Office of the Chief Financial Officer (OCFO) within the Department of Agriculture is the primary beneficiary, receiving critical IT systems engineering and technical assistance. The services delivered likely support the financial operations and IT infrastructure of the agency. The contract's location is specified as Louisiana (ST: LA), indicating a geographic focus for service delivery or contractor presence. The contract supports IT professionals and potentially other roles involved in systems design and technical assistance, impacting the federal IT workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The time and materials (T&M) pricing structure can lead to cost overruns if not diligently managed and monitored.
Lack of specific details on the number of bidders in the full and open competition makes it difficult to fully assess the degree of price pressure.
The long contract duration (over five years) increases the risk of scope creep or evolving technological needs not being adequately addressed without contract modifications.

Positive Signals

Awarded through full and open competition, suggesting a robust and fair bidding process.
The contract is for essential IT systems engineering and technical assistance, indicating a critical need being met.
The contractor, Lockheed Martin Services, Inc., is a large, established entity with significant experience in government contracting.

Sector Analysis

This contract falls within the Computer Systems Design Services sector (NAICS 541512), a critical component of the broader IT services market. This sector encompasses establishments primarily engaged in designing, developing, and supporting software and hardware, as well as providing IT infrastructure and consulting. The federal government is a major consumer of these services, with spending often concentrated in areas like cybersecurity, cloud computing, and enterprise resource planning systems. Comparable spending benchmarks would typically be found within IT services categories, often measured by contract vehicles like IT Schedule 70 or specific agency IDIQ contracts.

Small Business Impact

This contract was awarded to Lockheed Martin Services, Inc. and does not appear to have been specifically set aside for small businesses (SS: false, SB: false). As a large prime contractor, Lockheed Martin may engage small businesses as subcontractors. However, without specific subcontracting plans or goals detailed in the award data, the direct impact on the small business ecosystem is unclear. Analysis would require reviewing subcontracting reports associated with this contract to determine if small business participation was mandated or achieved.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Agriculture's contracting officers and program managers responsible for the Office of the Chief Financial Officer. The contract's performance would be monitored against the terms and conditions, including service level agreements and delivery schedules. Transparency is facilitated through public contract databases like FPDS.gov, where award details are recorded. The Inspector General's office for the USDA would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

IT Systems Engineering
Technical Assistance Contracts
Computer Systems Design Services
Department of Agriculture IT Spending
Large Prime IT Contracts
Time and Materials Contracts

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Long contract duration may not adapt well to rapid technological changes.
Limited insight into the specific number of bidders impacting competition assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $53.2 million to LOCKHEED MARTIN SERVICES, INC.. SYSTEMS ENGINEERING AND TECHNICAL ASSISTANCE (SETA)

Who is the contractor on this award?

The obligated recipient is LOCKHEED MARTIN SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Office of the Chief Financial Officer).

What is the total obligated amount?

The obligated amount is $53.2 million.

What is the period of performance?

Start: 2011-08-19. End: 2017-02-21.

What is the specific nature of the 'Systems Engineering and Technical Assistance' (SETA) services provided under this contract?

The provided data indicates the contract falls under NAICS code 541512 (Computer Systems Design Services) and is for 'Systems Engineering and Technical Assistance' (SETA). SETA contracts typically involve providing specialized technical expertise, engineering support, program management, and advisory services to government agencies. For the USDA's Office of the Chief Financial Officer, this could encompass support for financial systems modernization, IT infrastructure management, cybersecurity assessments, data analytics, or strategic IT planning. Without more granular details on the Statement of Work (SOW), the precise services remain generalized but are focused on enhancing the agency's IT capabilities and operational efficiency within its financial domain.

How does the $53.2 million contract value compare to other SETA contracts awarded by the USDA or similar agencies?

Comparing the $53.2 million value requires context regarding the contract's duration and scope. This contract spans from August 2011 to February 2017, approximately 5.4 years, yielding an average annual value of roughly $9.85 million. This figure appears substantial but not necessarily extraordinary for a large federal agency like the USDA requiring comprehensive IT support. SETA contracts can vary widely in value based on agency size, complexity of IT systems, and the specific services required. Larger agencies or those undergoing major IT transformations might award SETA contracts in the tens or hundreds of millions over similar periods. Further benchmarking would necessitate examining contracts with similar NAICS codes and service descriptions across different agencies and fiscal years.

What are the primary risks associated with the 'Time and Materials' (T&M) pricing structure used in this contract?

The primary risk of a Time and Materials (T&M) contract is the potential for cost overruns. Unlike fixed-price contracts, T&M agreements reimburse the contractor for the actual cost of labor (at specified hourly rates) and materials, plus a fee or profit. This structure provides flexibility but gives the contractor less incentive to control costs efficiently. If work is not carefully managed, scope is not tightly controlled, or labor hours are not diligently tracked and justified, costs can escalate beyond initial estimates. For the government, this necessitates robust oversight, detailed monitoring of hours worked, and verification of materials purchased to ensure fair pricing and prevent waste.

What does the 'Delivery Order' (AW: DELIVERY ORDER) award type signify in the context of this contract?

The 'Delivery Order' award type indicates that this contract is likely a task order issued under a larger Indefinite Delivery/Indefinite Quantity (IDIQ) contract vehicle. IDIQ contracts establish the terms and conditions for services or supplies over a period, but the actual quantities and delivery schedules are defined through individual delivery or task orders. This specific award represents one such order placed against a pre-existing IDIQ contract. This approach allows agencies to procure services more efficiently as needed, often with pre-negotiated rates and terms, streamlining the acquisition process for specific requirements.

What is Lockheed Martin Services, Inc.'s track record with federal IT contracts, particularly with the Department of Agriculture?

Lockheed Martin Services, Inc., as a subsidiary of the larger Lockheed Martin Corporation, has an extensive track record as a major federal contractor across various agencies and service areas, including IT. They are known for undertaking large, complex projects. While specific details on their historical performance solely with the USDA's OCFO for SETA services are not provided in this dataset, their general profile suggests significant experience. Agencies typically award contracts to established companies like Lockheed Martin based on demonstrated capability, past performance, and competitive pricing. A deeper dive into contract databases would reveal the breadth and depth of their work with the USDA and other agencies in similar IT service domains.

How does the geographic location specified (ST: LA - Louisiana) relate to the service delivery or the contractor's operations?

The designation 'ST: LA' (Louisiana) likely indicates a primary place of performance or a significant operational base for the contractor related to this specific delivery order. Federal contracts often specify the location where services will be rendered or where the contractor's relevant facilities are situated. For IT services like SETA, this could mean that a Lockheed Martin team is based in Louisiana to support the USDA's OCFO, potentially through on-site work, remote support originating from Louisiana, or managing resources located there. It might also reflect the location of a key subcontractor or a specific project office.

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: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 6404 IVY LANE, SUITE 800, GREENBELT, MD, 20770

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $53,233,068

Exercised Options: $53,233,068

Current Obligation: $53,233,068

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 263010054

IDV Type: IDC

Timeline