DoD's $31M IMDS software contract awarded to SAIC raises questions on competition and value

Contract Overview

Contract Amount: $31,015,054 ($31.0M)

Contractor: Science Applications International Corp

Awarding Agency: Department of Defense

Start Date: 2019-12-01

End Date: 2020-11-30

Contract Duration: 365 days

Daily Burn Rate: $85.0K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: PRODUCTION SOFTWARE - TF IMDS

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $31.0 million to SCIENCE APPLICATIONS INTERNATIONAL CORP for work described as: PRODUCTION SOFTWARE - TF IMDS Key points: 1. The contract's sole-source nature limits competitive pressure, potentially impacting price efficiency. 2. Performance context is limited due to the lack of comparative contract data. 3. Risk indicators are moderate, with a focus on delivery order execution. 4. The contract falls within the IT services sector, specifically computer-related services. 5. Value for money is difficult to assess without competitive benchmarks. 6. The contractor, SAIC, has a significant presence in the federal IT market.

Value Assessment

Rating: fair

Benchmarking the value for money on this contract is challenging due to its sole-source nature and the absence of publicly available comparable contract data. The fixed-price contract type provides some cost certainty, but without competitive bids, it's difficult to ascertain if the $31 million awarded represents a fair market price. The provided benchmark of $8,497,300 for a similar contract suggests this award might be on the higher end, though direct comparisons are limited by differing scopes and durations.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Science Applications International Corp (SAIC), was solicited. This approach bypasses the typical competitive bidding process, which can lead to higher prices and reduced innovation. The lack of competition means there was no opportunity for other qualified vendors to offer their services, potentially limiting the government's options and the discovery of the best value.

Taxpayer Impact: The absence of competition means taxpayers may not have received the most cost-effective solution. Without multiple bids, there's less pressure on the contractor to offer the lowest possible price, potentially leading to overspending.

Public Impact

The primary beneficiary is the Department of Defense, specifically the Defense Information Systems Agency (DISA). The contract delivers essential production software and support for the Total Force Management System (TFMS). The geographic impact is national, supporting DoD operations across various locations. Workforce implications include the continued employment of personnel by SAIC for software development and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition.
Lack of detailed performance metrics makes value assessment difficult.
Potential for cost overruns without competitive pressure.

Positive Signals

Contract awarded to a large, established federal contractor (SAIC).
Firm fixed-price contract provides cost certainty.
Delivery order structure allows for phased execution.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on computer-related services and software development. The federal IT market is substantial, with agencies like the DoD being major spenders. Contracts for production software and system support are common, often involving large, established companies like SAIC that possess specialized expertise. Benchmarks for similar IT services contracts vary widely based on scope, complexity, and duration, but this $31 million award for a one-year duration is significant.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have significant subcontracting requirements for small businesses based on the provided data. The award to a large prime contractor like SAIC suggests that the focus was on leveraging established capabilities rather than promoting small business participation. This could limit opportunities for smaller, innovative firms to engage with this specific DoD requirement.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Contract Management Agency (DCMA) and the relevant contracting officer within DISA. Accountability measures are inherent in the firm fixed-price structure, requiring SAIC to deliver the specified software within the agreed budget. Transparency is limited due to the sole-source nature and the lack of detailed public reporting on performance metrics. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Information Systems Agency (DISA) IT Services
Department of Defense Software Development Contracts
Total Force Management System (TFMS) Support
Science Applications International Corp (SAIC) Federal Contracts

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for inflated pricing
Limited transparency on performance

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $31.0 million to SCIENCE APPLICATIONS INTERNATIONAL CORP. PRODUCTION SOFTWARE - TF IMDS

Who is the contractor on this award?

The obligated recipient is SCIENCE APPLICATIONS INTERNATIONAL CORP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Information Systems Agency).

What is the total obligated amount?

The obligated amount is $31.0 million.

What is the period of performance?

Start: 2019-12-01. End: 2020-11-30.

What is the track record of Science Applications International Corp (SAIC) with the Department of Defense?

Science Applications International Corp (SAIC) is a major government contractor with a long history of serving the Department of Defense (DoD). They have secured numerous large contracts across various domains, including IT services, cybersecurity, engineering, and logistics. SAIC's extensive experience with the DoD suggests a deep understanding of military requirements and operational environments. However, like many large contractors, they have also faced scrutiny regarding contract performance and pricing on specific awards. Their ability to consistently deliver complex solutions and manage large-scale projects is generally recognized, but the specifics of each contract's execution and value remain critical for assessment.

How does the $31 million value compare to similar IT software contracts within the DoD?

Comparing the $31 million value of this specific contract requires careful consideration of scope, duration, and services rendered. This contract, for production software for the TFMS over one year, is substantial. While direct comparisons are difficult without more granular data on similar sole-source awards, the federal IT market sees a wide range of contract values. Larger, more complex system development or sustainment contracts can easily run into hundreds of millions or billions of dollars. However, for a single-year software production and support award, $31 million indicates a significant investment. The benchmark provided ($8,497,300) suggests this award might be considerably higher than some comparable, potentially competed, contracts, underscoring the potential cost implications of a sole-source award.

What are the primary risks associated with a sole-source award for critical software?

The primary risks associated with a sole-source award for critical software include lack of price competition, potentially leading to inflated costs for taxpayers. Without multiple bids, the government loses the opportunity to negotiate the best possible price and may not be aware of more innovative or cost-effective solutions offered by other vendors. There's also a risk of vendor lock-in, where the sole provider becomes indispensable, reducing leverage for future negotiations or transitions. Furthermore, sole-source awards can sometimes indicate a lack of market research or an inability to break down requirements into competitively viable packages. This can stifle innovation and reduce overall value for money.

How effective is the Total Force Management System (TFMS) in supporting DoD personnel?

The Total Force Management System (TFMS) is designed to be a comprehensive human resources and personnel management system for the Department of Defense, aiming to integrate various personnel functions across the different branches of the military. Its effectiveness is crucial for managing the careers, pay, benefits, and readiness of millions of service members and civilian employees. While the system's goals are to improve efficiency, data accuracy, and decision-making, its actual effectiveness can be influenced by factors such as system integration challenges, user adoption rates, and the quality of ongoing software development and support. Specific performance metrics and user feedback would be needed to provide a definitive assessment of its current effectiveness.

What is the historical spending trend for similar IT services by the Defense Information Systems Agency (DISA)?

The Defense Information Systems Agency (DISA) is a major consumer of IT services within the Department of Defense, consistently awarding billions of dollars annually for a wide array of services including network operations, cybersecurity, cloud computing, and software development. Historical spending trends show a significant and sustained investment in IT modernization and sustainment. DISA's budget allocation for IT services typically reflects the DoD's overall strategic priorities, such as enhancing readiness, improving command and control, and defending against cyber threats. While specific figures fluctuate year-to-year based on evolving requirements and program funding, DISA's role as a central IT provider ensures continuous and substantial spending in this sector.

Industry Classification

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

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: HC108419R0020

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Science Applications International Corporation

Address: 11720 PLAZA AMERICA DR, 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: $31,015,054

Exercised Options: $31,015,054

Current Obligation: $31,015,054

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $1,517,373

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HC108420D0002

IDV Type: IDC

Timeline