Parsons Government Services Inc. awarded $56.2M for IGF Joint Space Mission System Increment 2 by DoD

Contract Overview

Contract Amount: $56,227,284 ($56.2M)

Contractor: Parsons Government Services Inc.

Awarding Agency: Department of Defense

Start Date: 2015-02-27

End Date: 2022-03-31

Contract Duration: 2,589 days

Daily Burn Rate: $21.7K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: IGF::OT::IGF JOINT SPACE MISSION SYSTEM INCREMENT 2

Place of Performance

Location: COLORADO SPRINGS, EL PASO County, COLORADO, 80919

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $56.2 million to PARSONS GOVERNMENT SERVICES INC. for work described as: IGF::OT::IGF JOINT SPACE MISSION SYSTEM INCREMENT 2 Key points: 1. Contract awarded as a sole-source procurement, raising questions about potential price efficiencies. 2. The contract's duration of over 7 years suggests a long-term need for these services. 3. Custom computer programming services are critical for advanced defense systems. 4. The contract was not competed under the simplified acquisition threshold, indicating a larger procurement. 5. The cost-plus-fixed-fee structure may incentivize cost overruns if not closely monitored. 6. The absence of small business set-asides warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: fair

The contract's value of $56.2 million over approximately seven years for custom computer programming services requires careful benchmarking. Without comparable sole-source contracts for similar complex defense systems, assessing value for money is challenging. The cost-plus-fixed-fee (CPFF) pricing structure, while common for R&D and complex services, can lead to higher costs if not managed with stringent oversight, as the contractor is reimbursed for allowable costs plus a fixed fee. This structure may not be the most cost-effective compared to fixed-price contracts for well-defined scopes.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a sole-source procurement, meaning it was not openly competed. This approach is typically used when only one responsible source can provide the required services, often due to proprietary technology, unique capabilities, or urgent needs. The lack of competition means that the government did not benefit from a bidding process that could drive down prices through market forces. This raises concerns about whether the government secured the best possible price and value.

Taxpayer Impact: Sole-source awards limit the government's ability to leverage competition to achieve lower prices, potentially resulting in higher costs for taxpayers compared to a competed procurement.

Public Impact

The Department of Defense benefits from the development and maintenance of critical space mission systems. This contract supports advanced custom computer programming services essential for national security. The geographic impact is primarily within the contractor's operational areas, likely supporting defense infrastructure. The contract supports a specialized workforce in custom computer programming and systems integration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition.
Cost-plus-fixed-fee structure may lead to cost escalation.
Lack of small business participation noted.
Long contract duration requires sustained oversight.

Positive Signals

Contract addresses critical defense needs for space systems.
Parsons Government Services Inc. is an established contractor in the aerospace and defense sector.
The contract has a defined end date, providing a clear project lifecycle.

Sector Analysis

The Information Technology sector, specifically custom computer programming services (NAICS 541511), is a significant area of federal spending. This contract falls within the defense sub-sector, focusing on specialized software development for complex mission systems. The market for such services is characterized by high barriers to entry due to technical expertise requirements and security clearances. Federal spending in this area often involves long-term contracts for system development, integration, and sustainment, with values frequently in the tens to hundreds of millions of dollars.

Small Business Impact

This contract does not appear to have included specific small business set-asides, as indicated by 'sb: false'. The prime contractor, Parsons Government Services Inc., is a large business. Further analysis would be needed to determine if subcontracting opportunities were made available to small businesses. Without explicit set-asides or robust subcontracting plans, the direct impact on the small business ecosystem for this specific contract may be limited, though large prime contractors often engage small businesses for specialized tasks.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. The cost-plus-fixed-fee structure necessitates rigorous financial oversight to monitor allowable costs and ensure the fixed fee remains appropriate. Transparency is enhanced through contract reporting mechanisms, but the sole-source nature limits public visibility into the competitive aspects of the award. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

DoD Space Systems Development
Custom Computer Programming Services
Defense Mission Systems
IT Services for National Security

Risk Flags

Sole-source award requires strong justification.
Cost-plus-fixed-fee contracts need diligent oversight.
Long-term contract duration increases risk exposure.
Lack of competition may impact price discovery.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $56.2 million to PARSONS GOVERNMENT SERVICES INC.. IGF::OT::IGF JOINT SPACE MISSION SYSTEM INCREMENT 2

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $56.2 million.

What is the period of performance?

Start: 2015-02-27. End: 2022-03-31.

What is the track record of Parsons Government Services Inc. on similar sole-source IT contracts with the Department of Defense?

Parsons Government Services Inc. has a significant history of performing IT and engineering services for the Department of Defense. While specific data on their sole-source contract performance for similar space mission systems is not detailed here, their extensive experience suggests a capacity to handle complex projects. Analyzing past performance on cost-plus-fixed-fee contracts would be crucial to assess their ability to manage costs effectively and deliver within agreed-upon parameters. A review of past performance evaluations and any contract disputes or awards would provide a clearer picture of their reliability and value proposition in sole-source scenarios.

How does the $56.2 million contract value compare to similar custom computer programming services for defense space systems?

Benchmarking the $56.2 million contract value is challenging without specific details on the scope of work and duration relative to comparable contracts. However, for complex, long-term custom computer programming for defense space systems, this value is within a typical range. Sole-source awards, by their nature, do not provide direct price comparisons. A thorough analysis would involve identifying other sole-source or competed contracts for similar system development (e.g., satellite command and control, mission planning software) over similar timeframes and assessing the complexity and deliverables to establish a fair market price range.

What are the primary risks associated with the cost-plus-fixed-fee (CPFF) contract type for this project?

The primary risk with a CPFF contract is the potential for cost overruns. While the contractor's fee is fixed, they are reimbursed for all allowable costs incurred. This can create less incentive for the contractor to control costs compared to fixed-price contracts. Effective risk mitigation requires robust government oversight, including detailed cost monitoring, audits, and clear definition of allowable costs. Scope creep is another significant risk; any expansion of the project's requirements must be carefully managed through contract modifications to ensure the fixed fee and overall budget remain appropriate.

What is the expected program effectiveness and impact of the IGF Joint Space Mission System Increment 2?

The effectiveness and impact of the IGF Joint Space Mission System Increment 2 are expected to enhance the Department of Defense's capabilities in space operations. This likely includes improvements in areas such as satellite command and control, data processing, mission planning, or situational awareness. The 'Increment 2' designation suggests this is a follow-on phase, building upon previous capabilities. Enhanced effectiveness in these areas is critical for national security, enabling more robust and responsive space-based operations, intelligence gathering, and communication.

How has federal spending on custom computer programming services (NAICS 541511) for defense agencies trended over the past five years?

Federal spending on custom computer programming services (NAICS 541511) for defense agencies has generally shown an upward trend over the past five years, driven by modernization efforts, cybersecurity needs, and the increasing reliance on advanced technologies for national security. Agencies like the Department of Defense consistently represent a large portion of this spending. Factors such as geopolitical tensions, the need for sophisticated intelligence, surveillance, and reconnaissance (ISR) capabilities, and the development of next-generation weapon systems contribute to sustained or increased investment in this sector. Specific budget allocations can fluctuate based on strategic priorities and program lifecycles.

What are the implications of this contract being awarded outside of the Simplified Acquisition Threshold (SAT)?

Awarding this contract outside the Simplified Acquisition Threshold (SAT), which typically applies to procurements valued at $250,000 or less (though this threshold can be higher for certain agencies or circumstances), signifies a substantial investment. Procurements above the SAT generally require more formal acquisition processes, including increased documentation, justification for award type (like sole-source), and potentially more robust competition requirements, unless specific exceptions apply. For this $56.2 million contract, being above the SAT means it underwent a more rigorous review and approval process, and its sole-source nature required a strong justification to proceed without open competition.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › Space R&D Services

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Parsons Corporation

Address: 5875 TRINITY PKWY STE 230, CENTREVILLE, VA, 20120

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $57,376,321

Exercised Options: $57,376,321

Current Obligation: $56,227,284

Actual Outlays: $1,428,638

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline