P E Systems Inc. awarded $245M for Air Force engineering support, highlighting R&D in physical and engineering sciences

Contract Overview

Contract Amount: $244,986,981 ($245.0M)

Contractor: P E Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2019-09-01

End Date: 2024-02-29

Contract Duration: 1,642 days

Daily Burn Rate: $149.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: SCAT 1 ENGINEERING PROFESSIONAL AND ADMINISTRATIVE SUPPORT SERVICES (EPASS) IN SUPPORT OF AIR FORCE LIFE CYCLE MANAGEMENT CENTER AGILE COMBAT SUPPORT DIRECTORATE (AFLCMC/WN)

Place of Performance

Location: FAIRFAX, FAIRFAX CITY County, VIRGINIA, 22030

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $245.0 million to P E SYSTEMS, INC. for work described as: SCAT 1 ENGINEERING PROFESSIONAL AND ADMINISTRATIVE SUPPORT SERVICES (EPASS) IN SUPPORT OF AIR FORCE LIFE CYCLE MANAGEMENT CENTER AGILE COMBAT SUPPORT DIRECTORATE (AFLCMC/WN) Key points: 1. Contract provides critical engineering and administrative support for Air Force life cycle management. 2. Focus on agile combat support demonstrates a commitment to modernizing Air Force capabilities. 3. The contract's duration of over 1600 days suggests a long-term need for these specialized services. 4. Research and Development in physical, engineering, and life sciences is a key component of the awarded work. 5. The significant value indicates a substantial investment in maintaining and advancing Air Force technology. 6. Performance is situated within the Department of the Air Force, a major defense sector player.

Value Assessment

Rating: good

The contract value of approximately $245 million over its period of performance appears reasonable for specialized engineering and administrative support services to a major defense directorate. Benchmarking against similar large-scale R&D support contracts within the Department of Defense would provide a more precise value-for-money assessment. However, the scope suggests a comprehensive suite of services, implying a competitive pricing structure was likely sought.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which suggests a competitive process but with specific limitations or exclusions. This implies that while multiple sources were considered, certain entities may have been excluded for specific reasons, potentially related to specialized capabilities or prior relationships. The number of bidders is not explicitly stated, but the award type indicates a structured competition.

Taxpayer Impact: This limited competition structure may have implications for taxpayer value, as it could potentially lead to less aggressive pricing compared to a truly open competition with a wider range of bidders. However, it also suggests that the selected contractor possesses unique qualifications deemed essential for the program's success.

Public Impact

The primary beneficiaries are the Air Force Life Cycle Management Center (AFLCMC) and its Agile Combat Support Directorate, receiving essential technical and administrative expertise. Services delivered include engineering support, administrative functions, and research and development critical for maintaining and advancing Air Force combat capabilities. The geographic impact is primarily centered around the contractor's operations and the Air Force facilities they support, likely within Virginia where the contract is registered. Workforce implications include the employment of engineers, scientists, administrative staff, and other technical professionals by P E Systems, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may restrict price discovery and potentially increase costs for taxpayers.
The long contract duration could lead to vendor lock-in if not managed carefully.
Reliance on a single contractor for critical support functions poses a risk if performance falters.

Positive Signals

The contract supports a critical Air Force directorate, indicating a strong alignment with national defense priorities.
The focus on R&D suggests investment in future technological advancements for the Air Force.
P E Systems, Inc. has been awarded a significant contract, implying a level of trust and proven capability.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The market for defense-related engineering and technical support services is substantial, driven by the continuous need for modernization and sustainment of complex military systems. Comparable spending benchmarks would involve analyzing other large-scale engineering support contracts awarded by the Department of Defense to prime contractors.

Small Business Impact

The data indicates that small business participation (ss: false, sb: false) was not a primary set-aside objective for this specific contract. This suggests that the primary focus was on securing specialized technical expertise, likely from larger, established firms. There is no explicit information on subcontracting plans for small businesses, which could be a missed opportunity to engage the small business ecosystem in supporting this critical defense function.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program management office within the Air Force Life Cycle Management Center. Accountability measures are embedded in the contract terms, including performance standards and payment schedules. Transparency is facilitated through contract databases like FPDS, though detailed performance reports are often internal. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Air Force Life Cycle Management Center (AFLCMC) Operations
Agile Combat Support Programs
Defense Research and Development Contracts
Engineering and Technical Services for DoD
Aerospace Engineering Support Services

Risk Flags

Limited competition may not yield the best possible pricing.
Contract duration is lengthy, requiring sustained oversight.
Cost-plus contract type can lead to cost overruns if not managed stringently.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $245.0 million to P E SYSTEMS, INC.. SCAT 1 ENGINEERING PROFESSIONAL AND ADMINISTRATIVE SUPPORT SERVICES (EPASS) IN SUPPORT OF AIR FORCE LIFE CYCLE MANAGEMENT CENTER AGILE COMBAT SUPPORT DIRECTORATE (AFLCMC/WN)

Who is the contractor on this award?

The obligated recipient is P E SYSTEMS, 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 $245.0 million.

What is the period of performance?

Start: 2019-09-01. End: 2024-02-29.

What is the historical spending pattern for P E Systems, Inc. with the Department of Defense, and how does this contract compare?

P E Systems, Inc. has a history of securing contracts with the Department of Defense, particularly in areas related to engineering, technical, and professional services. Analyzing their contract awards over the past five to ten years would reveal a pattern of engagement with various branches and agencies. This $245 million contract represents a significant award, likely one of their larger engagements, indicating a substantial role in supporting the Air Force's R&D and sustainment efforts. Comparing this to their other DoD awards would highlight its relative size and importance within their federal portfolio, suggesting a deep specialization or a key strategic partnership with the Air Force Life Cycle Management Center.

How does the pricing structure (Cost Plus Fixed Fee) typically perform in terms of value for money compared to other contract types for R&D services?

Cost Plus Fixed Fee (CPFF) contracts are common for research and development efforts where the scope is not fully defined at the outset, allowing for flexibility. While CPFF can incentivize innovation and adaptation, it carries a higher risk of cost overruns compared to fixed-price contracts. Value for money in CPFF contracts depends heavily on robust oversight, clear definition of allowable costs, and effective negotiation of the fixed fee. Benchmarking against similar R&D contracts awarded under different structures (e.g., Cost Plus Incentive Fee, Firm-Fixed-Price) would be necessary to definitively assess value. However, the inherent flexibility of CPFF often means that achieving the lowest possible cost is secondary to ensuring the successful completion of complex, evolving R&D objectives.

What are the specific risks associated with the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' award type for taxpayers?

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' award type introduces specific risks for taxpayers. While it implies a competitive process, the exclusion of certain sources means the government may not have considered the full spectrum of potential bidders. This limitation can reduce the competitive pressure on pricing, potentially leading to higher costs than if all qualified sources were allowed to compete. Furthermore, the reasons for exclusion, if not transparently justified, could raise concerns about fairness or potential favoritism. Taxpayers bear the risk of paying a premium if the limited competition results in a less optimal price outcome for the government's investment in these critical R&D services.

What performance metrics or key performance indicators (KPIs) are likely being used to evaluate P E Systems, Inc.'s success under this contract?

Given the nature of engineering and administrative support for R&D, performance metrics likely focus on technical execution, timeliness, and adherence to budget. Key Performance Indicators (KPIs) could include the successful completion of research milestones, the quality and accuracy of engineering deliverables, the efficiency of administrative support processes, and the contractor's ability to manage costs within the approved budget. Metrics related to personnel qualifications, retention rates, and responsiveness to Air Force requests would also be crucial. The Cost Plus Fixed Fee structure necessitates close monitoring of cost performance and the contractor's ability to achieve program objectives without excessive cost growth.

How does this contract align with the Air Force's broader strategic goals for modernization and technological advancement?

This contract directly aligns with the Air Force's broader strategic goals by providing essential engineering and R&D support to the Life Cycle Management Center's Agile Combat Support Directorate. Modernization and technological advancement are core tenets of Air Force strategy, aiming to maintain air superiority and adapt to evolving threats. By funding specialized R&D and engineering services, the Air Force is investing in the development and sustainment of cutting-edge combat capabilities. The focus on agile combat support specifically addresses the need for responsive, adaptable systems that can be rapidly deployed and updated, ensuring the Air Force remains at the forefront of aerospace technology.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except 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: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 10201 FAIRFAX BLVD STE 400, FAIRFAX, VA, 22030

Business Categories: Black American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $489,045,943

Exercised Options: $316,568,016

Current Obligation: $244,986,981

Actual Outlays: $7,243,123

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q14OADS724

IDV Type: IDC

Timeline