DoD Awards $300M for Ship Design Services to Serco-IPS Corporation
Contract Overview
Contract Amount: $300,236,526 ($300.2M)
Contractor: Serco-Ips Corporation
Awarding Agency: Department of Defense
Start Date: 2008-12-19
End Date: 2016-12-01
Contract Duration: 2,904 days
Daily Burn Rate: $103.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: SHIP DESIGN SERVICES
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20170
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $300.2 million to SERCO-IPS CORPORATION for work described as: SHIP DESIGN SERVICES Key points: 1. Contract awarded to Serco-IPS Corporation for ship design services. 2. Significant value of $300.2 million over its period of performance. 3. Procured under full and open competition, indicating a competitive bidding process. 4. The contract spans nearly 8 years, from late 2008 to late 2016. 5. Services fall under Engineering Services (NAICS 541330).
Value Assessment
Rating: fair
The contract's Cost Plus Fixed Fee (CPFF) structure can lead to cost overruns if not managed carefully. Benchmarking against similar CPFF contracts for complex engineering services is difficult without more detailed cost breakdowns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Full and open competition was utilized, suggesting a robust price discovery process. However, the CPFF pricing structure may limit the direct cost savings typically achieved through competitive bidding.
Taxpayer Impact: Taxpayer funds are utilized for complex engineering services. The CPFF structure necessitates close oversight to ensure cost efficiency and prevent unnecessary expenditures.
Public Impact
Supports critical naval capabilities through specialized ship design. The long duration suggests a sustained need for these engineering services. Potential for follow-on work or related contracts based on this foundation. Impacts the defense industrial base and specialized engineering firms.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee (CPFF) pricing can incentivize contractor spending.
- Long contract duration increases risk of scope creep or evolving requirements.
- Lack of specific performance metrics makes value assessment challenging.
- No indication of small business participation.
Positive Signals
- Awarded through full and open competition.
- Supports essential defense capabilities.
- Experienced contractor likely involved.
Sector Analysis
This contract falls within the Engineering Services sector, specifically supporting the Department of Defense's shipbuilding and maintenance needs. Spending benchmarks for similar large-scale, long-duration engineering contracts can vary widely based on complexity and specific requirements.
Small Business Impact
The data indicates that small businesses were not a primary focus or direct awardee for this specific contract, as it was awarded to Serco-IPS Corporation and no small business set-aside is noted. Further analysis would be needed to determine if small businesses were involved as subcontractors.
Oversight & Accountability
The Department of Defense, through the Defense Contract Management Agency, is responsible for overseeing this contract. The CPFF structure requires diligent oversight to manage costs and ensure adherence to contract terms and objectives.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Cost Plus Fixed Fee (CPFF) pricing model.
- Long contract duration (nearly 8 years).
- Lack of specific performance metrics or deliverables in summary data.
- No small business participation noted.
- Potential for cost overruns and contractor inefficiency.
Tags
engineering-services, department-of-defense, va, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $300.2 million to SERCO-IPS CORPORATION. SHIP DESIGN SERVICES
Who is the contractor on this award?
The obligated recipient is SERCO-IPS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $300.2 million.
What is the period of performance?
Start: 2008-12-19. End: 2016-12-01.
What specific ship classes or types of vessels were designed under this contract, and how did the designs contribute to naval modernization or operational readiness?
The provided data does not specify the exact ship classes or types of vessels designed. To assess the value, one would need to examine contract modifications, technical reports, and naval deployment records to understand the specific contributions to modernization and operational readiness. This information is crucial for evaluating the true impact of the $300 million investment beyond the contractual award itself.
Given the CPFF structure and long duration, what mechanisms were in place to control costs and mitigate risks associated with potential contractor inefficiencies or scope creep?
The Cost Plus Fixed Fee (CPFF) structure inherently carries a risk of cost overruns. Effective oversight by the Defense Contract Management Agency would be critical, involving detailed cost audits, regular progress reviews, and strict change control processes to manage scope creep. Without specific documentation on these oversight activities, it's difficult to definitively assess the effectiveness of risk mitigation.
How did the competitive bidding process for this contract ensure the government received the best value, considering the CPFF pricing model and the specialized nature of ship design services?
Full and open competition aims to ensure the best value by soliciting offers from all responsible sources. However, the CPFF pricing model can complicate 'best value' determinations, as it shifts some cost risk to the government. The evaluation criteria used during the competition, beyond just price, would be key to understanding how value was assessed, particularly regarding technical approach, past performance, and management capabilities.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: N0002409R3014
Offers Received: 4
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 12930 WORLDGATE DR STE 600, HERNDON, VA, 20170
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $311,618,804
Exercised Options: $311,158,149
Current Obligation: $300,236,526
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0017804D4066
IDV Type: IDC
Timeline
Start Date: 2008-12-19
Current End Date: 2016-12-01
Potential End Date: 2016-12-01 00:00:00
Last Modified: 2025-10-30
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