DoD's $1.09B Contract with Parsons Government Services: A 17-Year Award Fee Agreement
Contract Overview
Contract Amount: $1,093,792,932 ($1.1B)
Contractor: Parsons Government Services Inc.
Awarding Agency: Department of Defense
Start Date: 1999-11-10
End Date: 2016-12-31
Contract Duration: 6,261 days
Daily Burn Rate: $174.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Place of Performance
Location: NEWPORT, VERMILLION County, INDIANA, 47966
State: Indiana Government Spending
Plain-Language Summary
Department of Defense obligated $1.09 billion to PARSONS GOVERNMENT SERVICES INC. for work described as: Key points: 1. Significant long-term commitment of over 17 years for a substantial value. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. The contract type is Cost Plus Award Fee, which incentivizes performance. 4. The sector appears to be related to government services, likely IT or support functions.
Value Assessment
Rating: fair
The contract value is substantial at over $1 billion. Without specific benchmarks for similar long-term, cost-plus award fee contracts for government services, assessing its pricing fairness is difficult. The award fee structure implies potential for cost control and performance incentives.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating multiple bidders participated. This method generally promotes price discovery and competitive pricing, though the Cost Plus Award Fee structure can introduce complexities in final cost determination.
Taxpayer Impact: The long duration and significant value mean taxpayers are committed for an extended period. The effectiveness of the award fee structure in controlling costs will be a key factor in the ultimate taxpayer impact.
Public Impact
Long-term government service contracts can impact budget predictability. The use of award fees aims to align contractor performance with government objectives. Transparency in award fee determinations is crucial for public trust. The duration suggests a critical or ongoing need for the services provided.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (17 years) may limit flexibility.
- Cost Plus Award Fee contracts can be complex to manage and audit.
- Lack of specific performance metrics makes it hard to assess value.
Positive Signals
- Full and open competition suggests potential for good pricing.
- Award fee structure incentivizes contractor performance.
- Contractor has a long history with the Department of the Army.
Sector Analysis
This contract falls within the government services sector, likely encompassing IT, logistics, or professional support. Benchmarking requires comparison with similar long-term, cost-plus contracts for comparable services within the federal government.
Small Business Impact
The data indicates the prime contractor is Parsons Government Services Inc., a large business. There is no explicit information on subcontracting to small businesses within this data snippet.
Oversight & Accountability
The long duration and cost-plus nature of this contract warrant robust oversight to ensure costs are reasonable and performance meets objectives. Auditing of incurred costs and award fee determinations is critical for accountability.
Related Government Programs
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Long contract duration may indicate a lack of adaptability to changing needs.
- Cost-plus contracts inherently carry a higher risk of cost overruns.
- Award fee structure requires careful definition of metrics to prevent gaming.
- Lack of specific service details hinders a thorough value assessment.
- The contract was awarded in 1999, suggesting potential for outdated technology or processes if not actively managed.
Tags
department-of-defense, in, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $1.09 billion to PARSONS GOVERNMENT SERVICES INC.. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is PARSONS GOVERNMENT SERVICES 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 $1.09 billion.
What is the period of performance?
Start: 1999-11-10. End: 2016-12-31.
What specific services were provided under this contract, and how did they align with the Department of the Army's mission objectives over the 17-year period?
The provided data does not specify the services rendered. However, given the contractor and duration, it likely involved significant support functions, potentially IT infrastructure, logistics management, or professional services critical to Army operations. Understanding the alignment requires reviewing the contract's statement of work and performance reports.
How were the award fees determined, and what was the average percentage of award fees paid out relative to the base cost over the contract's life?
The methodology for determining award fees is not detailed in the data. Typically, this involves evaluating contractor performance against pre-defined metrics and objectives. To assess value and taxpayer impact, analyzing the actual award fees paid versus the potential maximum would be necessary, alongside the base costs.
What was the total cost growth or savings realized through the Cost Plus Award Fee structure compared to a fixed-price contract for similar services?
Direct comparison to a fixed-price contract is not possible with the given data. Cost Plus Award Fee contracts aim to balance flexibility in cost with performance incentives. The effectiveness in controlling costs depends heavily on the clarity of performance metrics and the rigor of oversight in managing the 'cost' and 'award' components.
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Offers Received: 2
Pricing Type: COST PLUS AWARD FEE (R)
Contractor Details
Parent Company: Parsons Corporation (UEI: 030866545)
Address: HWY 63 S OFFICE COMPLEX, NEWPORT, IN, 47966
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 1999-11-10
Current End Date: 2016-12-31
Potential End Date: 2016-12-31 00:00:00
Last Modified: 2018-09-29
More Contracts from Parsons Government Services Inc.
- Salt Waste Processing Facility Conceptual Design — $2.3B (Department of Energy)
- THE Contractor Must Furnish ALL Professional, Technical and Support Labor, Material, Supplies, Management Services, Data, and Facilities Required to Accomplish the Work to BE Ordered Under Technical F Igf::ot::igf — $1.5B (Department of Transportation)
- EO14042 Teams-Next Missile Defense Systems Engineering — $1.1B (Department of Defense)
- THE Purpose of This Action IS to Execute an Administrative Continuance of the Task Order, and Transfers the Administration From Region 1 to Fedsim — $612.4M (General Services Administration)
- THE Purpose of This Award IS for the C5isr, Exercises, Operations, and Information Services (ceois) Task Order IS to Provide Near Real-Time Situational Awareness and Decision Support to the DOD Combatant Commands (ccmds) — $520.2M (General Services Administration)
View all Parsons Government Services Inc. federal contracts →
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)