DoD's $11.5M Modeling and Simulation Support Contract Awarded to BAE Systems

Contract Overview

Contract Amount: $11,465,607 ($11.5M)

Contractor: BAE Systems Technology Solutions & Services Inc.

Awarding Agency: Department of Defense

Start Date: 2016-02-01

End Date: 2021-01-15

Contract Duration: 1,810 days

Daily Burn Rate: $6.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF MODELING AND SIMULATION SUPPORT

Place of Performance

Location: PANAMA CITY BEACH, BAY County, FLORIDA, 32407

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $11.5 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. for work described as: IGF::OT::IGF MODELING AND SIMULATION SUPPORT Key points: 1. Contract value represents a significant investment in advanced engineering services. 2. BAE Systems, a major defense contractor, secured this award. 3. The contract duration of 1810 days indicates a long-term need for these services. 4. The award was made under full and open competition, suggesting a robust bidding process. 5. The cost-plus-fixed-fee pricing structure requires careful monitoring of expenditures. 6. This contract falls within the engineering services sector, supporting critical defense capabilities.

Value Assessment

Rating: good

The contract value of approximately $11.5 million over five years for modeling and simulation support appears reasonable given the specialized nature of the services and the contractor's expertise. Benchmarking against similar large-scale engineering support contracts within the Department of Defense suggests that pricing is competitive. The cost-plus-fixed-fee structure, while requiring oversight, is common for complex projects where final costs are not easily predictable at the outset. The value delivered is tied to the critical nature of simulation and modeling for defense system development and testing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The presence of four bids suggests a healthy level of competition for this significant engineering services contract. This competitive process is expected to drive more favorable pricing and ensure the selection of a capable provider for the Department of the Navy's modeling and simulation needs.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that typically leads to better value and more efficient use of public funds. The open competition ensures that the government explores a range of options and pricing, preventing potential overspending.

Public Impact

The Department of the Navy benefits from advanced modeling and simulation capabilities, crucial for system design, testing, and training. This contract supports the development and sustainment of sophisticated defense technologies. The services delivered are essential for ensuring the effectiveness and readiness of naval assets. The contract is geographically focused in Florida, potentially impacting the local high-tech workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can incentivize cost overruns if not closely managed.
The long duration of the contract may lead to scope creep if not clearly defined and monitored.
Reliance on a single large contractor for critical simulation support could pose a risk if performance falters.

Positive Signals

Award to a reputable contractor with a strong track record in defense technology.
Full and open competition suggests a thorough vetting of capabilities and pricing.
The contract addresses a critical need for advanced modeling and simulation in defense.
Long-term nature of the contract provides stability for essential support services.

Sector Analysis

The contract falls within the Engineering Services sector (NAICS 541330), a critical component of the defense industrial base. This sector is characterized by high technical expertise, significant R&D investment, and close ties to government procurement. The market for defense engineering services is substantial, with major players like BAE Systems competing for large, long-term contracts that support the development and sustainment of complex military systems. This specific contract for modeling and simulation support is vital for ensuring technological superiority and operational effectiveness in the defense sector.

Small Business Impact

This contract was awarded through full and open competition and does not indicate any specific small business set-aside provisions. While BAE Systems is a large prime contractor, there may be opportunities for small businesses to participate as subcontractors, particularly in specialized areas of modeling and simulation. The extent of small business subcontracting would depend on BAE Systems' procurement strategy and the specific technical requirements of the contract.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Navy's contracting officers and program managers. They are responsible for monitoring performance, ensuring compliance with contract terms, and managing expenditures, especially given the cost-plus-fixed-fee structure. The Inspector General's office for the Department of Defense may also conduct audits or investigations to ensure accountability and prevent fraud, waste, and abuse. Transparency is facilitated through contract award databases and reporting requirements.

Related Government Programs

Department of Defense Modeling and Simulation Programs
Naval Air Systems Command (NAVAIR) Support Contracts
Engineering and Technical Services Contracts
Cost-Plus-Fixed-Fee Contracts in Defense

Risk Flags

Cost-plus-fixed-fee contract requires diligent oversight to manage potential cost escalations.
Long contract duration necessitates clear scope management to prevent creep.
Reliance on a single large contractor for critical support functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.5 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC.. IGF::OT::IGF MODELING AND SIMULATION SUPPORT

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $11.5 million.

What is the period of performance?

Start: 2016-02-01. End: 2021-01-15.

What is BAE Systems' track record with similar modeling and simulation contracts for the Department of Defense?

BAE Systems has a substantial and well-documented track record of providing complex engineering, technical, and simulation support services to the Department of Defense across various branches, including the Navy, Army, and Air Force. They are known for their expertise in areas such as virtual prototyping, wargaming, training simulations, and systems integration. Their past performance often includes large, multi-year contracts requiring advanced modeling capabilities for aircraft, naval vessels, and ground systems. While specific details of past contract performance metrics are often proprietary, BAE Systems' consistent presence as a prime contractor on major defense programs indicates a generally positive and reliable performance history in delivering these critical services.

How does the $11.5 million value compare to other modeling and simulation support contracts awarded by the DoD?

The $11.5 million contract value for modeling and simulation support awarded to BAE Systems is within a common range for specialized engineering services supporting major defense programs. However, the DoD procures a wide spectrum of modeling and simulation services, with contract values varying significantly based on scope, duration, and complexity. Some contracts, particularly those involving large-scale system development or enterprise-wide simulation infrastructure, can reach hundreds of millions or even billions of dollars. Conversely, smaller, more focused support tasks might be in the low millions. This particular contract appears to be a mid-sized award, reflecting a specific, long-term need for specialized expertise rather than a broad, foundational program.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract structure for this type of service?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract structure, like the one awarded to BAE Systems, is the potential for cost overruns. While the 'fixed fee' provides the contractor with a guaranteed profit margin, the 'cost plus' element means the government reimburses the contractor for allowable costs incurred. If costs escalate beyond initial estimates due to inefficiencies, scope creep, or unforeseen technical challenges, the total expenditure for the government can increase significantly. This necessitates robust oversight from the contracting agency to scrutinize costs, ensure efficiency, and prevent unnecessary spending. The contractor, conversely, has less incentive to control costs compared to fixed-price contracts, as their fee remains constant regardless of the final cost.

How effective is modeling and simulation in supporting the development and testing of new defense technologies?

Modeling and simulation (M&S) are exceptionally effective and increasingly indispensable tools in the development and testing of new defense technologies. They allow for the virtual testing of systems under a vast array of conditions that might be too dangerous, expensive, or time-consuming to replicate in the physical world. M&S can accelerate design cycles, identify potential flaws early in the development process, optimize system performance, and reduce the need for costly physical prototypes. Furthermore, simulations are crucial for training personnel, evaluating operational tactics, and assessing the integration of new technologies into existing platforms. The DoD heavily relies on M&S to maintain a technological edge and ensure the readiness and effectiveness of its forces.

What has been the historical spending trend for engineering services (NAICS 541330) by the Department of the Navy?

The Department of the Navy consistently allocates significant funding towards engineering services, categorized under NAICS code 541330. Historical spending data indicates a steady and often increasing trend in this category over the past decade, driven by modernization efforts, platform sustainment, research and development for new capabilities, and complex system integration projects. While specific annual figures fluctuate based on budgetary priorities and acquisition cycles, engineering services represent a substantial portion of the Navy's overall contract obligations. This reflects the ongoing need for specialized technical expertise to design, build, maintain, and upgrade its diverse fleet of ships, aircraft, and associated systems.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering 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

Solicitation ID: N0002415R3093

Offers Received: 4

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Ball Corporation

Address: 520 GAITHER ROAD, ROCKVILLE, MD, 20850

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $16,639,480

Exercised Options: $16,639,480

Current Obligation: $11,465,607

Subaward Activity

Number of Subawards: 12

Total Subaward Amount: $6,596,177

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4018

IDV Type: IDC

Timeline