DOT's $17.7M FAA contract for computer systems design services awarded to SAAB SENSIS CORPORATION

Contract Overview

Contract Amount: $17,694,777 ($17.7M)

Contractor: Saab Sensis Corporation

Awarding Agency: Department of Transportation

Start Date: 2003-10-11

End Date: 2013-06-30

Contract Duration: 3,550 days

Daily Burn Rate: $5.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: DAFIS UDO RECONSTRUCT W/O ADVANCE

Place of Performance

Location: EAST SYRACUSE, ONONDAGA County, NEW YORK, 13057

State: New York Government Spending

Plain-Language Summary

Department of Transportation obligated $17.7 million to SAAB SENSIS CORPORATION for work described as: DAFIS UDO RECONSTRUCT W/O ADVANCE Key points: 1. Value for money appears fair given the long duration and cost-plus contract type, suggesting potential for cost overruns. 2. Competition dynamics were full and open, indicating a robust bidding process. 3. Risk indicators include the cost-plus contract type and a long performance period, which can increase cost uncertainty. 4. Performance context is for computer systems design services, a broad category that requires detailed understanding of specific needs. 5. Sector positioning is within IT services for the Federal Aviation Administration, supporting critical infrastructure.

Value Assessment

Rating: fair

The contract's total value of $17.7 million over approximately 10 years suggests an average annual spend of $1.77 million. Without specific deliverables or performance metrics, it's challenging to benchmark value definitively. The Cost Plus Fixed Fee (CPFF) structure, while allowing for flexibility, can sometimes lead to higher costs compared to fixed-price contracts if not managed tightly. Comparing this to similar long-term IT system design contracts would provide better context on pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. The presence of multiple bidders in such a scenario typically drives prices down and encourages innovation. The specific number of bidders is not provided, but the 'full and open' designation implies a competitive environment that should have resulted in a fair market price.

Taxpayer Impact: A full and open competition generally benefits taxpayers by ensuring the government receives competitive pricing and the best value available in the market.

Public Impact

The Federal Aviation Administration (FAA) is the primary beneficiary, receiving computer systems design services. These services likely support the modernization or maintenance of air traffic control systems or related aviation infrastructure. The geographic impact is likely national, given the FAA's mandate, though specific project locations are not detailed. Workforce implications could include employment for IT professionals, engineers, and support staff involved in system design and implementation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus contract type can lead to cost overruns if not meticulously managed.
Long contract duration (10 years) increases the risk of scope creep and evolving technological needs not being met efficiently.
Lack of specific performance metrics makes it difficult to assess contractor efficiency and effectiveness over time.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
Contractor SAAB SENSIS CORPORATION has a track record with government contracts, implying some level of established capability.
The contract supports the Federal Aviation Administration, a critical government agency.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on computer systems design services. The IT services market for the federal government is substantial, with significant spending allocated to software development, system integration, and IT support. Contracts like this are crucial for maintaining and upgrading the complex technological infrastructure required by agencies like the FAA. Benchmarking against similar IT system design contracts for large federal agencies would reveal if the $17.7 million over 10 years represents a competitive rate.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. There is no explicit information regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific contract is likely minimal, unless the prime contractor voluntarily engages small businesses for specialized services.

Oversight & Accountability

Oversight mechanisms for this contract would typically involve the contracting officer's representative (COR) and the agency's procurement office. The Inspector General's office for the Department of Transportation may also conduct audits or investigations into contract performance and spending, particularly given the cost-plus nature and long duration. Transparency is facilitated through contract databases, but detailed performance reports are often internal.

Related Government Programs

FAA IT Modernization Programs
Air Traffic Control System Upgrades
Federal Civilian IT Procurement
Department of Transportation IT Services

Risk Flags

Long contract duration increases risk of technological obsolescence.
Cost-plus contract type may lead to higher costs than fixed-price alternatives.
Lack of specified performance metrics hinders objective evaluation.
Potential for scope creep over a 10-year performance period.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $17.7 million to SAAB SENSIS CORPORATION. DAFIS UDO RECONSTRUCT W/O ADVANCE

Who is the contractor on this award?

The obligated recipient is SAAB SENSIS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $17.7 million.

What is the period of performance?

Start: 2003-10-11. End: 2013-06-30.

What is SAAB SENSIS CORPORATION's track record with federal contracts, particularly in IT system design?

SAAB SENSIS CORPORATION has a history of receiving federal contracts, including those related to aviation systems and IT services. While specific details on past performance for similar system design contracts are not provided in this summary, their engagement with the FAA suggests a recognized capability in the aviation IT domain. A deeper dive into their contract history, including past performance evaluations and any disputes or awards, would offer a more comprehensive view of their reliability and expertise. Their ability to secure a long-term, high-value contract with the FAA indicates a level of trust and proven performance in serving government needs within their specialized area.

How does the $17.7 million total contract value compare to similar IT system design contracts for aviation agencies?

Benchmarking the $17.7 million total contract value requires comparing it against similar IT system design contracts awarded to other aviation agencies or for comparable projects. Factors such as contract duration (10 years), scope of work (computer systems design), and contract type (Cost Plus Fixed Fee) are critical for a fair comparison. If similar contracts for system design over a decade are in the range of $10-20 million, this contract appears within a reasonable market range. However, if comparable projects were completed for significantly less, or if this contract's scope is less complex than others in the benchmark, it might suggest a less favorable value. Without specific comparable data, a definitive assessment is difficult.

What are the primary risks associated with the Cost Plus Fixed Fee (CPFF) contract type for this project?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract is that the government may end up paying more than necessary if the contractor's costs exceed initial estimates, even though the fee is fixed. While the fixed fee incentivizes the contractor to control costs to maximize their profit margin on the fee, there's less direct incentive to minimize the *base cost* compared to a fixed-price contract. For a long-term project like this, there's also a risk of scope creep or evolving requirements that could lead to cost increases if not managed rigorously. Effective oversight by the government is crucial to scrutinize costs and ensure the contractor is performing efficiently and not inflating expenses.

How effective is the 'full and open competition' process in ensuring value for money for this type of IT service contract?

The 'full and open competition' process is generally considered the most effective method for ensuring value for money in federal contracting. By allowing all responsible sources to bid, it fosters a competitive environment that drives down prices and encourages innovation. For IT service contracts, which can be complex and varied, this approach allows the government to solicit proposals that best meet its specific needs and technical requirements. The success in achieving value depends on the clarity of the solicitation, the evaluation criteria, and the number and quality of the bids received. A robust competition typically leads to a fair market price and a higher likelihood of selecting a contractor capable of delivering quality services.

What are the potential implications of the 10-year duration on the contract's relevance and cost-effectiveness?

A 10-year contract duration for computer systems design services presents both opportunities and risks. On the positive side, it allows for long-term planning, deep integration, and potentially significant cost savings through economies of scale and sustained focus. It can also foster a strong working relationship between the government and the contractor. However, the primary risk is technological obsolescence. Over a decade, technology evolves rapidly, and systems designed at the beginning of the contract may become outdated or inefficient by the end. This necessitates robust contract management to incorporate updates, ensure adaptability, and potentially renegotiate terms to maintain cost-effectiveness and relevance throughout the contract's life.

Are there specific performance metrics or KPIs associated with this contract to measure success?

The provided data does not specify the performance metrics or Key Performance Indicators (KPIs) associated with this contract. For a computer systems design services contract, especially one awarded under a CPFF structure and spanning a decade, clearly defined KPIs are essential for effective oversight and ensuring value. These metrics would typically relate to project milestones, system performance, reliability, user satisfaction, and adherence to budget and schedule. Without explicit KPIs, assessing the contractor's performance and the overall success of the contract becomes subjective and relies heavily on the diligence of the government's project management team.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Saab Aktiebolag (UEI: 354001059)

Address: 1700 DELL AVE, CAMPBELL, CA, 95008

Business Categories: Category Business, Small Business

Financial Breakdown

Contract Ceiling: $96,918,121

Exercised Options: $28,365,637

Current Obligation: $17,694,777

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline