DoD's $21.3M R&D contract for Blackjack Prototype Ground Operations Center awarded to Parsons Government Services Inc

Contract Overview

Contract Amount: $21,308,870 ($21.3M)

Contractor: Parsons Government Services Inc.

Awarding Agency: Department of Defense

Start Date: 2021-12-10

End Date: 2028-10-21

Contract Duration: 2,507 days

Daily Burn Rate: $8.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: SBIR PHASE III - BLACKJACK PROTOTYPE GROUND OPERATIONS CENTER

Place of Performance

Location: PASADENA, LOS ANGELES County, CALIFORNIA, 91124

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $21.3 million to PARSONS GOVERNMENT SERVICES INC. for work described as: SBIR PHASE III - BLACKJACK PROTOTYPE GROUND OPERATIONS CENTER Key points: 1. Contract awarded as a definitive contract with a cost-plus-fixed-fee pricing structure. 2. The contract duration is 2507 days, spanning from December 10, 2021, to October 21, 2028. 3. The contract was not competed, raising questions about potential price discovery and value. 4. The North American Industry Classification System (NAICS) code 541715 indicates research and development in physical, engineering, and life sciences. 5. The contract is categorized under Research and Development (R&D) within the Defense sector. 6. The awardee, Parsons Government Services Inc., is a known entity in government contracting. 7. The contract value is approximately $21.3 million over its term. 8. The contract is not a small business set-aside, and no subcontracting information is readily available.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its specific R&D nature and lack of competitive bidding. The cost-plus-fixed-fee structure can sometimes lead to higher costs if not carefully managed, as the contractor is reimbursed for allowable costs plus a fixed fee. Without comparable sole-source R&D contracts for similar prototype ground operations centers, it's difficult to definitively assess if the $21.3 million represents fair value. Further analysis of the fixed fee and the contractor's cost proposals would be necessary for a more precise valuation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competition from other potential bidders. This approach is typically used when a specific contractor possesses unique capabilities or when circumstances prevent a competitive process. The lack of competition means that the government did not benefit from the price reductions and innovation that can arise from a bidding process. This raises concerns about whether the government secured the best possible price and solution.

Taxpayer Impact: Taxpayers may not have received the most cost-effective solution due to the absence of competitive pressure. The government's negotiating position is also weakened without alternative offers.

Public Impact

The primary beneficiary is the Department of the Air Force, which will receive the developed ground operations center capabilities. The contract supports the development and operationalization of the Blackjack prototype, likely enhancing its mission readiness and effectiveness. The geographic impact is primarily within the United States, specifically where Parsons Government Services Inc. conducts its operations and where the Blackjack program is based. The contract will likely involve a workforce of engineers, technicians, and support staff employed by Parsons Government Services Inc. and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition limits price discovery and potentially increases costs for taxpayers.
Cost-plus-fixed-fee contracts require diligent oversight to manage costs effectively.
The specific nature of R&D makes it difficult to benchmark performance and value without detailed technical insights.
Long contract duration (over 6 years) increases exposure to potential cost overruns or scope creep.

Positive Signals

Award to an established contractor like Parsons Government Services Inc. suggests a level of confidence in their capabilities.
Definitive contract structure provides a framework for a long-term relationship and development.
Focus on R&D for a prototype indicates investment in future defense capabilities.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on engineering and physical sciences. The defense R&D market is characterized by significant government investment, often involving specialized technologies and long development cycles. Comparable spending benchmarks are difficult to establish without knowing the precise nature of the 'Blackjack Prototype Ground Operations Center.' However, R&D contracts in the defense sector can range from millions to billions of dollars, depending on the complexity and strategic importance of the technology being developed.

Small Business Impact

This contract does not appear to be a small business set-aside, as indicated by 'ss': false. There is no explicit information provided regarding subcontracting plans or goals for small businesses. This suggests that the primary awardee, Parsons Government Services Inc., will likely perform the majority of the work, and the direct impact on the small business ecosystem through this specific contract may be limited unless the prime contractor actively engages small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. As a definitive contract, it likely includes reporting requirements and milestones that the contractor must meet. Transparency may be limited due to the sole-source nature and the classified or sensitive aspects of defense R&D. Inspector General jurisdiction would apply to investigate any potential fraud, waste, or abuse related to the contract's execution.

Related Government Programs

Department of Defense Research and Development Programs
Air Force Prototype Development Contracts
Ground Operations Systems Development
Advanced Technology Development Contracts

Risk Flags

Sole-source award lacks competitive justification.
Cost-plus-fixed-fee pricing requires vigilant oversight.
Long contract duration increases risk of cost overruns.
Specific R&D scope may be difficult to benchmark.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.3 million to PARSONS GOVERNMENT SERVICES INC.. SBIR PHASE III - BLACKJACK PROTOTYPE GROUND OPERATIONS CENTER

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 (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $21.3 million.

What is the period of performance?

Start: 2021-12-10. End: 2028-10-21.

What is the specific nature of the 'Blackjack Prototype Ground Operations Center' and its intended function?

The provided data does not detail the specific functionalities or purpose of the 'Blackjack Prototype Ground Operations Center.' However, given the context of a ground operations center for a prototype, it likely pertains to the infrastructure, systems, and procedures required to support the testing, deployment, or command and control of a new defense asset or system, potentially an aircraft or unmanned aerial vehicle, referred to as 'Blackjack.' This could involve mission planning, data processing, communication links, maintenance support, and personnel coordination necessary for the prototype's operational evaluation.

What is Parsons Government Services Inc.'s track record with similar sole-source R&D contracts for the Department of Defense?

Parsons Government Services Inc. has a significant history of contracting with the U.S. government, including the Department of Defense, across various service and technology domains. While specific details on their track record with sole-source R&D contracts for prototype ground operations centers are not provided here, their extensive experience suggests familiarity with defense acquisition processes. A deeper dive into their contract history, particularly with the Air Force, would reveal the frequency and scale of similar sole-source awards and their performance outcomes on those contracts. This would help assess their capability and reliability in executing such specialized R&D efforts.

How does the cost-plus-fixed-fee (CPFF) structure compare to other pricing models for R&D contracts of this nature?

The Cost-Plus-Fixed-Fee (CPFF) structure is common for R&D contracts where the scope of work can be uncertain or evolve. In a CPFF contract, the contractor is reimbursed for all allowable costs incurred and receives a predetermined fixed fee representing their profit. This differs from fixed-price contracts, where the price is set upfront, and cost-plus-incentive-fee (CPIF) contracts, which include incentives for meeting cost, schedule, or performance targets. CPFF offers flexibility for evolving R&D but can lead to higher costs if not managed tightly, as the contractor has less financial incentive to control costs compared to fixed-price or CPIF arrangements. The government bears more cost risk.

What are the potential risks associated with the sole-source award of this R&D contract?

The primary risk of a sole-source award is the lack of competitive pressure, which can lead to inflated pricing and reduced innovation. Without competing offers, the government may not secure the best value or the most advanced technological solution available. There's also a risk that the contractor may not be as motivated to control costs or adhere strictly to timelines as they would be in a competitive environment. Furthermore, sole-source awards can sometimes be perceived as less transparent, potentially raising concerns about fairness and the efficient use of taxpayer funds, especially if the justification for the sole-source nature is not robust.

What historical spending patterns exist for similar R&D efforts within the Department of the Air Force?

Historical spending patterns for similar R&D efforts within the Department of the Air Force are extensive and varied, reflecting the broad spectrum of technological advancements pursued. The Air Force consistently invests heavily in areas such as aerospace technology, C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance), electronic warfare, and advanced materials. Spending can range from small, targeted research grants to multi-billion dollar programs for major weapon systems. Analyzing past R&D expenditures under NAICS code 541715 and similar codes, particularly for prototype development and advanced technology integration, would provide context for the $21.3 million award, though direct comparisons are challenging due to the unique nature of each R&D project.

What are the implications of the contract's long duration (over 6 years) on program management and cost control?

A contract duration of over six years for an R&D project presents both opportunities and challenges. On the positive side, it allows for sustained focus and development, crucial for complex technological advancements where breakthroughs may not be immediate. It can foster a deeper partnership between the government and the contractor. However, such a long duration also increases the risk of cost escalation due to inflation, changes in technology, or evolving program requirements. Program management becomes critical to ensure milestones are met, scope creep is managed, and the fixed fee remains appropriate throughout the contract's life. Regular reviews and potential contract modifications will be essential to control costs and adapt to new information or technological shifts.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: HR001121R0002

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, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $49,629,174

Exercised Options: $49,629,174

Current Obligation: $21,308,870

Actual Outlays: $378,617

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $77,618

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline