SAIC awarded $192.7M Army HR system support contract via full and open competition

Contract Overview

Contract Amount: $192,683,221 ($192.7M)

Contractor: Science Applications International Corporation

Awarding Agency: General Services Administration

Start Date: 2014-02-06

End Date: 2017-02-05

Contract Duration: 1,095 days

Daily Burn Rate: $176.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: IGF::OT::IGF TASK ORDER (TO) GSQ0014AJ0041 IS HEREBY AWARDED TO SCIENCE APPLICATIONS INTERNATIONAL CORPORATION (SAIC) TO PROVIDE THE U.S ARMY HUMANS RESOURCE COMMAND (HRC) WITH MAINTENANCE, ENHANCEMENT, AND DEVELOPMENT SUPPORT FOR SYSTEMS, PROGRAMS, APPLICATIONS, AND DATABASES VITAL TO MANAGING THE ARMY'S PERSONNEL, IN PEACETIME AND AT WAR.

Place of Performance

Location: FORT KNOX, HARDIN County, KENTUCKY, 40122

State: Kentucky Government Spending

Plain-Language Summary

General Services Administration obligated $192.7 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: IGF::OT::IGF TASK ORDER (TO) GSQ0014AJ0041 IS HEREBY AWARDED TO SCIENCE APPLICATIONS INTERNATIONAL CORPORATION (SAIC) TO PROVIDE THE U.S ARMY HUMANS RESOURCE COMMAND (HRC) WITH MAINTENANCE, ENHANCEMENT, AND DEVELOPMENT SUPPORT FOR SYSTEMS, PROGRAMS, APPLICATIONS, AND DATABASES VI… Key points: 1. Contract provides critical maintenance, enhancement, and development for Army personnel management systems. 2. Full and open competition suggests a potentially competitive pricing environment. 3. The contract duration of three years indicates a medium-term commitment for system support. 4. SAIC, a large established contractor, is positioned to deliver complex IT services. 5. The contract's focus on HR systems highlights its importance to military personnel operations. 6. The cost-plus-fixed-fee structure allows for flexibility but requires careful cost oversight.

Value Assessment

Rating: good

The contract value of approximately $192.7 million over three years for comprehensive IT support to the Army Human Resources Command appears reasonable given the scope of services. While direct comparisons are difficult without more granular data on specific system support, the price per year averages around $64.2 million. This figure should be benchmarked against similar large-scale IT support contracts for government HR systems to fully assess value for money. The cost-plus-fixed-fee (CPFF) pricing structure, while common for complex IT development and maintenance, necessitates robust oversight to ensure costs remain controlled and the fixed fee is justified by the services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The presence of multiple bidders (4 noted) in such a competitive environment typically drives down prices and encourages innovation. The specific number of bids received is not detailed, but the 'full and open' designation suggests a robust competitive process was intended and likely achieved, leading to a potentially favorable outcome for the government in terms of price discovery.

Taxpayer Impact: Taxpayers benefit from a competitive award process that aims to secure the best value by allowing multiple companies to bid, potentially leading to lower overall costs for essential Army HR systems.

Public Impact

The U.S. Army Human Resources Command directly benefits from enhanced and maintained systems crucial for personnel management. Soldiers and Army personnel will experience improved services related to their human resources data and management. The contract supports the operational readiness of the Army by ensuring the reliability of vital personnel systems. The geographic impact is primarily within the Army's operational footprint, supporting personnel management functions nationwide and potentially globally.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can lead to cost overruns if not managed diligently.
The long-term reliance on a single contractor for critical systems may pose future transition risks.
Ensuring adequate performance metrics are met under the CPFF structure is crucial for value realization.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
SAIC is a well-established contractor with a proven track record in government IT services.
The contract addresses critical functions for Army personnel management, indicating strategic importance.

Sector Analysis

This contract falls within the Computer Systems Design Services sector, a significant segment of the IT services market supporting government operations. The market for such services is large and competitive, with numerous firms capable of providing maintenance, enhancement, and development support for complex government systems. The value of this contract, at approximately $64 million annually, is substantial but within the range of large-scale IT support endeavors for major federal agencies. Comparable spending benchmarks would involve looking at other large IT modernization and sustainment contracts within the Department of Defense and other federal agencies.

Small Business Impact

This contract was not set aside for small businesses and was awarded under full and open competition, with SAIC, a large business, as the prime contractor. There is no explicit mention of small business subcontracting requirements in the provided data. The lack of a small business set-aside suggests that the primary focus was on obtaining the best technical solution and price from the broadest possible pool of offerors. The impact on the small business ecosystem would depend on whether SAIC actively pursues small business subcontractors for specialized support, which is not detailed here.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contract administration office within the General Services Administration (GSA) or the U.S. Army Human Resources Command. Performance monitoring, financial reviews, and adherence to contract terms would be key oversight mechanisms. Transparency is facilitated through contract award databases, but detailed performance reports are often internal. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Army Personnel Management Systems
Defense Human Resources IT Support
Federal Civilian HR IT Services
IT Modernization Contracts
Large-Scale System Sustainment

Risk Flags

Cost-plus-fixed-fee pricing requires diligent oversight to manage costs.
Potential for vendor lock-in if transition planning is inadequate.
Reliance on a single contractor for critical systems carries inherent risk.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $192.7 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. IGF::OT::IGF TASK ORDER (TO) GSQ0014AJ0041 IS HEREBY AWARDED TO SCIENCE APPLICATIONS INTERNATIONAL CORPORATION (SAIC) TO PROVIDE THE U.S ARMY HUMANS RESOURCE COMMAND (HRC) WITH MAINTENANCE, ENHANCEMENT, AND DEVELOPMENT SUPPORT FOR SYSTEMS, PROGRAMS, APPLICATIONS, AND DATABASES VITAL TO MANAGING THE ARMY'S PERSONNEL, IN PEACETIME AND AT WAR.

Who is the contractor on this award?

The obligated recipient is SCIENCE APPLICATIONS INTERNATIONAL CORPORATION.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $192.7 million.

What is the period of performance?

Start: 2014-02-06. End: 2017-02-05.

What is SAIC's track record with similar large-scale IT support contracts for the Department of Defense?

Science Applications International Corporation (SAIC) has a substantial track record of performing large-scale IT support and system development contracts for the Department of Defense (DoD) and other federal agencies. They are a major government contractor known for handling complex projects involving IT infrastructure, software development, cybersecurity, and mission support. Their experience often includes managing critical systems similar to those supporting human resources, logistics, and command and control. While specific details of past performance on contracts of identical scope and value are not provided here, SAIC's general profile indicates they possess the resources, expertise, and security clearances necessary for such demanding work. Evaluating their past performance on similar DoD contracts would involve reviewing contract databases for awards, performance ratings (if publicly available), and any reported issues or successes.

How does the annual cost of this contract compare to industry benchmarks for similar HR system support?

The annual cost for this contract averages approximately $64.2 million ($192.7 million / 3 years). Benchmarking this against industry standards for supporting large-scale, mission-critical HR systems within a federal agency requires detailed comparison points. Factors influencing cost include the complexity of the systems, the number of users, the scope of maintenance and development required, and the specific technologies involved. Generally, government IT support contracts can vary widely. For large federal HR systems, annual costs in the tens of millions are not uncommon, especially when encompassing development and enhancement alongside maintenance. To provide a precise benchmark, one would need to compare this contract's scope of work, service level agreements (SLAs), and the specific HR modules supported against similar contracts awarded to other large system integrators for agencies like the Department of Veterans Affairs, the Department of Justice, or other branches of the military. Without such granular data, it's challenging to definitively state if $64.2M/year is high or low, but it falls within the expected range for significant federal IT sustainment and modernization efforts.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for IT system support?

The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract, like the one awarded to SAIC, revolve around cost control and contractor incentive. For the government, the main risk is that the contractor may not be sufficiently incentivized to control costs, as the government agrees to pay all allowable costs plus a fixed fee. If costs escalate beyond initial projections, the government still pays the agreed-upon fixed fee on top of the higher costs, potentially leading to a higher total price than anticipated. Contractors, on the other hand, might be incentivized to increase costs to ensure they cover all expenses and achieve their fixed profit margin, though they do not profit from cost increases themselves. For IT system support, risks include scope creep where additional features or services are requested, potentially increasing costs without a corresponding adjustment to the fixed fee unless a formal change order is processed. Effective oversight, detailed cost tracking, and robust contract management are crucial to mitigate these risks and ensure the government receives good value.

What is the historical spending trend for Army Human Resources Command IT support?

Analyzing the historical spending trend for Army Human Resources Command (HRC) IT support requires access to multi-year budget and contract award data specific to HRC. This single contract award of $192.7 million over three years (2014-2017) represents a significant investment. To understand the trend, one would need to examine prior contracts for similar services, noting their values, durations, and the contractors involved. It's plausible that spending on HR IT systems has increased over time due to modernization efforts, growing data needs, and evolving technological landscapes. Conversely, spending could fluctuate based on major system upgrades or shifts in IT strategy. Without a broader dataset encompassing previous years' spending on HRC IT support, it's difficult to establish a definitive trend. However, the scale of this award suggests a consistent and substantial requirement for robust IT infrastructure to manage Army personnel.

How does the competition level (full and open) impact the potential for innovation in system enhancements?

A full and open competition environment generally fosters innovation by allowing a wide range of potential offerors, including established large companies and potentially more agile smaller firms, to propose solutions. When multiple companies compete, they are incentivized to differentiate themselves not only on price but also on the technical merit and innovative approaches they bring to system maintenance, enhancement, and development. This competitive pressure encourages bidders to propose cutting-edge technologies, more efficient methodologies, or novel features that could significantly improve the functionality and performance of the Army's HR systems. The government can then evaluate these diverse proposals and select the one that offers the best combination of innovation, performance, and value. While the contract itself is for support, the initial competition sets the stage for SAIC to potentially introduce innovative solutions throughout the contract period, especially if the contract allows for flexibility in enhancements.

Industry Classification

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

Offers Received: 4

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 12010 SUNSET HILLS RD, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $221,214,371

Exercised Options: $221,214,371

Current Obligation: $192,683,221

Subaward Activity

Number of Subawards: 162

Total Subaward Amount: $177,281,063

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS00Q09BGD0048

IDV Type: GWAC

Timeline