GSA's $411M Computer Systems Design Contract with Leidos Faces Scrutiny Over Value and Competition
Contract Overview
Contract Amount: $411,186,685 ($411.2M)
Contractor: Leidos, Inc.
Awarding Agency: General Services Administration
Start Date: 2014-05-15
End Date: 2020-01-29
Contract Duration: 2,085 days
Daily Burn Rate: $197.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS AWARD FEE
Sector: IT
Official Description: IGF::OT::IGF
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20405
Plain-Language Summary
General Services Administration obligated $411.2 million to LEIDOS, INC. for work described as: IGF::OT::IGF Key points: 1. Significant contract value of $411M over 5 years. 2. Leidos, Inc. is the sole awardee, raising questions about competition. 3. The contract type (Cost Plus Award Fee) can incentivize cost overruns. 4. Spending concentrated in Washington D.C. metro area.
Value Assessment
Rating: questionable
The Cost Plus Award Fee structure, while offering flexibility, can lead to higher costs compared to fixed-price contracts. Benchmarking against similar IT services contracts is needed to assess if the award fee structure adequately controlled costs relative to performance.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Despite being awarded under full and open competition, the single award to Leidos, Inc. suggests limited market participation or a highly specialized requirement. The impact on price discovery is unclear without knowing the number of bids received and their competitiveness.
Taxpayer Impact: The substantial value of this contract represents a significant allocation of taxpayer funds. Ensuring competitive pricing and efficient service delivery is crucial for maximizing the value derived from this expenditure.
Public Impact
Taxpayers funded over $411 million for computer systems design services. The contract supported IT infrastructure and services, impacting government operations. Services were primarily delivered in the Washington D.C. area.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Award Fee contract type
- Single award to Leidos, Inc.
- Long contract duration (2085 days)
Positive Signals
- Awarded under Full and Open Competition
- Contract supported critical IT services
Sector Analysis
This contract falls within the IT services sector, specifically computer systems design. The federal IT services market is highly competitive, with numerous large and small businesses offering similar capabilities. Benchmarks for similar contracts would typically show a range of pricing based on complexity and service levels.
Small Business Impact
The data indicates this contract was not set aside for small businesses (sb: false). While awarded under full and open competition, there is no specific information on small business participation as subcontractors.
Oversight & Accountability
Oversight of this contract would involve monitoring Leidos' performance against award fee criteria and ensuring costs are reasonable and allocable. The General Services Administration (GSA) is responsible for managing this contract, with the Federal Acquisition Service providing administrative support.
Related Government Programs
- Computer Systems Design Services
- General Services Administration Contracting
- Federal Acquisition Service Programs
Risk Flags
- Potential for cost overruns due to CPAF structure.
- Limited competition despite 'full and open' award.
- Lack of transparency on small business subcontracting.
- Long contract duration may not reflect evolving technological needs.
Tags
computer-systems-design-services, general-services-administration, dc, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
General Services Administration awarded $411.2 million to LEIDOS, INC.. IGF::OT::IGF
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: General Services Administration (Federal Acquisition Service).
What is the total obligated amount?
The obligated amount is $411.2 million.
What is the period of performance?
Start: 2014-05-15. End: 2020-01-29.
What was the justification for awarding this large contract to a single vendor under full and open competition, and did it result in competitive pricing?
The justification for a single award under full and open competition typically relates to the unique capabilities required or the specific nature of the requirement that leads only one offeror to be deemed the best value. However, it raises concerns about whether the competitive process truly fostered optimal price discovery or if potential bidders were deterred. Further analysis of the solicitation and award documents is needed to understand the rationale and its impact on the final price.
How effectively did the Cost Plus Award Fee structure incentivize performance while controlling costs for this $411M contract?
Cost Plus Award Fee (CPAF) contracts aim to balance flexibility with performance incentives. However, they carry an inherent risk of cost growth if not meticulously overseen. The effectiveness hinges on clearly defined award criteria and robust government monitoring. Without detailed performance reports and cost analysis, it's difficult to definitively assess if CPAF achieved optimal value for taxpayers or encouraged unnecessary spending.
What was the overall value proposition and return on investment for taxpayers given the contract's duration and cost structure?
Assessing the value proposition requires comparing the delivered services against the $411M expenditure over five years. The CPAF structure complicates direct value assessment, as costs could fluctuate. A thorough review would involve analyzing performance metrics, the criticality of the computer systems design services to agency missions, and whether alternative solutions could have provided similar or better outcomes at a lower cost.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 3
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc. (UEI: 611641312)
Address: 700 N FREDERICK AVE, GAITHERSBURG, MD, 20879
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $553,523,263
Exercised Options: $553,523,263
Current Obligation: $411,186,685
Actual Outlays: $-9,573
Subaward Activity
Number of Subawards: 116
Total Subaward Amount: $28,469,487
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS00Q09BGD0039
IDV Type: GWAC
Timeline
Start Date: 2014-05-15
Current End Date: 2020-01-29
Potential End Date: 2020-01-29 00:00:00
Last Modified: 2021-09-15
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