DoD's $816M contract for threat modeling and simulation support awarded to Modern Technology Solutions, Inc

Contract Overview

Contract Amount: $8,160,080 ($8.2M)

Contractor: Modern Technology Solutions, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-06-07

End Date: 2028-06-06

Contract Duration: 1,460 days

Daily Burn Rate: $5.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: THE PERFORMANCE WORK STATEMENT ENTITLED THREAT WEAPONS MODELING AND SIMULATION SUPPORT, DATED 25 MARCH 2024, IS HEREBY INCORPORATED BY REFERENCE.

Place of Performance

Location: DAYTON, GREENE County, OHIO, 45433

State: Ohio Government Spending

Plain-Language Summary

Department of Defense obligated $8.2 million to MODERN TECHNOLOGY SOLUTIONS, INC. for work described as: THE PERFORMANCE WORK STATEMENT ENTITLED THREAT WEAPONS MODELING AND SIMULATION SUPPORT, DATED 25 MARCH 2024, IS HEREBY INCORPORATED BY REFERENCE. Key points: 1. Contract focuses on advanced research and development in physical, engineering, and life sciences. 2. Awarded under full and open competition, indicating a competitive bidding process. 3. The contract duration of 1460 days suggests a long-term need for these specialized services. 4. Performance work statement emphasizes modeling and simulation capabilities for threat weapons. 5. The cost-plus-fixed-fee pricing structure allows for flexibility while managing costs. 6. This award represents a significant investment in defense-related R&D.

Value Assessment

Rating: good

The contract value of $816 million over approximately four years for specialized R&D services appears reasonable given the complexity and duration. Benchmarking against similar large-scale modeling and simulation contracts within the Department of Defense is necessary for a precise value-for-money assessment. The cost-plus-fixed-fee structure, while common for R&D, requires careful oversight to ensure efficiency and prevent cost overruns. The fixed fee component provides some predictability for the contractor's profit.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition after exclusion of sources,' which implies that the solicitation was broadly advertised, and multiple responsible sources were permitted to submit proposals. The presence of 3 bidders suggests a moderate level of competition for this specialized R&D requirement. While not a large number, it indicates that the market has at least a few capable providers.

Taxpayer Impact: A competitive process, even with a limited number of bidders, generally leads to better price discovery and potentially more favorable terms for taxpayers compared to sole-source awards.

Public Impact

The Department of the Air Force will benefit from enhanced capabilities in threat weapons modeling and simulation. This contract supports advanced research and development activities crucial for national security. The services delivered are expected to improve the effectiveness and efficiency of defense systems. The contract is based in Ohio, potentially creating or sustaining high-skilled jobs in the region. The R&D outcomes could influence future defense technology development and procurement.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost growth inherent in cost-plus contracts requires diligent oversight.
Ensuring the fixed fee remains appropriate throughout the contract lifecycle is crucial.
The specialized nature of the R&D may limit the pool of qualified small business subcontractors.

Positive Signals

Awarded through full and open competition, suggesting a robust market evaluation.
The contract duration indicates a stable, long-term need for these critical services.
Modern Technology Solutions, Inc. likely possesses specialized expertise required for this complex R&D.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The market for defense-related modeling and simulation is substantial, driven by the need for advanced warfighting capabilities and technological superiority. Comparable spending often involves significant investments in simulation technologies, virtual training environments, and advanced analytical tools to support defense planning and acquisition. This contract aligns with broader government efforts to leverage cutting-edge scientific research for national security objectives.

Small Business Impact

The contract was not set aside for small businesses, and the data indicates no specific subcontracting goals were mentioned. Given the large contract value and specialized R&D nature, it is less likely to be heavily reliant on small business set-asides. However, the prime contractor may engage small businesses for specific niche capabilities or support services, but this is not explicitly detailed in the provided information.

Oversight & Accountability

Oversight will likely be managed by the Department of the Air Force contracting and program management offices. Accountability measures are embedded within the cost-plus-fixed-fee structure, requiring detailed reporting and justification of costs. Transparency is typically maintained through contract databases and reporting requirements, though specific details of the performance work statement and deliverables may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Advanced Research Projects Agency (DARPA) projects
Air Force Research Laboratory programs
Modeling and Simulation (M&S) initiatives
Advanced Weapons Systems Development
Cost-Plus-Fixed-Fee Contracts
Research and Development Services

Risk Flags

Cost Overrun Risk (CPFF)
Limited Small Business Participation Potential
Specialized Market Competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.2 million to MODERN TECHNOLOGY SOLUTIONS, INC.. THE PERFORMANCE WORK STATEMENT ENTITLED THREAT WEAPONS MODELING AND SIMULATION SUPPORT, DATED 25 MARCH 2024, IS HEREBY INCORPORATED BY REFERENCE.

Who is the contractor on this award?

The obligated recipient is MODERN TECHNOLOGY SOLUTIONS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $8.2 million.

What is the period of performance?

Start: 2024-06-07. End: 2028-06-06.

What is the specific expertise of Modern Technology Solutions, Inc. in threat weapons modeling and simulation?

Modern Technology Solutions, Inc. (MTSI) is known for its expertise in advanced technology solutions, particularly in areas relevant to defense and national security. While specific details of their threat weapons modeling and simulation capabilities for this particular contract are proprietary, MTSI's general profile includes significant work in systems engineering, simulation and modeling, test and evaluation, and advanced technology research. They often support complex defense programs requiring deep technical understanding of physics, engineering, and software development. Their experience likely encompasses developing and validating complex models, performing high-fidelity simulations, and providing analytical support for weapon system design, performance assessment, and operational planning. The 'Research and Development in the Physical, Engineering, and Life Sciences' NAICS code further supports their engagement in this type of advanced scientific and technical work.

How does the $816 million contract value compare to similar R&D contracts in defense?

An $816 million contract for R&D in threat weapons modeling and simulation over four years is a substantial award, indicative of a critical and complex program. Within the Department of Defense, large-scale R&D contracts, especially those involving advanced simulation and modeling for weapon systems, frequently reach hundreds of millions of dollars. These contracts often span multiple years due to the iterative nature of research, development, testing, and refinement. For context, other major defense R&D efforts, such as those managed by DARPA or specific service branches for next-generation platforms or technologies, can range from tens of millions to well over a billion dollars. The value here suggests a significant, long-term commitment to advancing specific defense capabilities through sophisticated analytical and simulation tools.

What are the primary risks associated with this cost-plus-fixed-fee contract?

The primary risks associated with a Cost-Plus-Fixed-Fee (CPFF) contract, like this one, revolve around cost control and contractor efficiency. For the government, the main risk is that the actual costs incurred by the contractor could exceed initial estimates, potentially leading to a higher final price than anticipated, even with a fixed fee. This necessitates robust oversight to ensure that all costs claimed are reasonable, allocable, and allowable. For the contractor, the risk lies in underestimating the effort required to achieve the fixed fee, potentially reducing their profit margin if costs escalate significantly. There's also a risk that the contractor might be less incentivized to control costs as rigorously as they would under a fixed-price contract, as the government bears the majority of the cost risk. Effective management and clear performance metrics are crucial to mitigate these risks.

What is the expected impact of this contract on future defense technology?

This contract is expected to have a significant impact on future defense technology by enhancing the capabilities for modeling and simulating threat weapons. Advanced simulation allows for more accurate prediction of weapon system performance, identification of vulnerabilities, and optimization of design before costly physical prototypes are built. This can accelerate the development cycle for new defense technologies, reduce the cost of acquisition, and improve the effectiveness of fielded systems. The insights gained from sophisticated threat modeling can inform the development of countermeasures, improve strategic planning, and ensure that U.S. defense capabilities maintain a technological edge against evolving threats. Ultimately, it contributes to a more robust and adaptable defense posture.

How does the competition level (3 bidders) influence the value for taxpayers?

Having three bidders for this specialized R&D contract suggests a moderate level of competition. While more bidders generally lead to greater price pressure and potentially better value, three capable sources indicate that the market is not entirely constrained. This level of competition allows for comparison of technical approaches and pricing, providing the government with a basis for negotiation and selection of the most advantageous offer. It helps ensure that the selected contractor's proposed costs and fee are reasonable relative to the scope of work and the capabilities of other potential providers. However, a lower number of bidders could also signal barriers to entry or a highly specialized market, which might limit the downward pressure on price compared to a scenario with numerous competitors.

What is the historical spending pattern for threat weapons modeling and simulation within the Department of Defense?

Historical spending patterns for threat weapons modeling and simulation within the Department of Defense are substantial and have been consistently high due to the critical nature of these capabilities. The DoD invests billions annually across various programs and agencies (like DARPA, AFRL, Army Research Lab) in simulation, modeling, analysis, and virtual environments to support research, development, testing, and evaluation of weapon systems. This spending is driven by the need to maintain technological superiority, understand adversary capabilities, and optimize the performance and cost-effectiveness of defense acquisitions. Contracts for these services often involve complex, long-term efforts, frequently utilizing cost-reimbursement or cost-plus contract types, reflecting the inherent uncertainties in R&D. The $816 million award to MTSI fits within this established pattern of significant and sustained investment in advanced simulation and modeling.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 5285 SHAWNEE RD STE 400, ALEXANDRIA, VA, 22312

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

Financial Breakdown

Contract Ceiling: $18,439,345

Exercised Options: $9,639,725

Current Obligation: $8,160,080

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $8,444,461

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA860422DB007

IDV Type: IDC

Timeline