DoD awards $120M engineering services contract to Science Applications International Corporation, continuing a prior award
Contract Overview
Contract Amount: $119,893,555 ($119.9M)
Contractor: Science Applications International Corporation
Awarding Agency: Department of Defense
Start Date: 2011-07-07
End Date: 2014-03-31
Contract Duration: 998 days
Daily Burn Rate: $120.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: CONTINUATION CONTRACT OF N00178-04-D-4143 M804
Place of Performance
Location: PATUXENT RIVER, SAINT MARYS County, MARYLAND, 20670
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $119.9 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: CONTINUATION CONTRACT OF N00178-04-D-4143 M804 Key points: 1. Contract value represents a significant investment in engineering services for the Department of the Navy. 2. The award is a continuation, suggesting a need for ongoing support and potentially stable contractor performance. 3. Engineering services are critical for defense readiness and technological advancement. 4. The contract type (Cost Plus Fixed Fee) can lead to cost overruns if not managed carefully. 5. The duration of the contract indicates a long-term requirement for these services. 6. The specific NAICS code (541330) points to a specialized engineering services market.
Value Assessment
Rating: fair
The total award amount of approximately $120 million for engineering services over a period of nearly three years warrants careful scrutiny. While specific benchmarks for this exact type of engineering support are difficult to ascertain without more granular data on the scope of work, the Cost Plus Fixed Fee (CPFF) contract type introduces inherent risk. CPFF contracts can sometimes lead to higher final costs compared to fixed-price contracts if the contractor's costs exceed initial estimates, although the fixed fee provides some predictability for the contractor's profit. Benchmarking against similar large-scale engineering service contracts within the Department of Defense would be necessary for a more definitive value assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple capable vendors had the opportunity to bid. The fact that it is a continuation of a prior award (N00178-04-D-4143 M804) suggests that the initial competition likely resulted in a qualified contractor being selected. However, the specific number of bidders for this particular delivery order is not provided, which limits the assessment of the intensity of the competition. Full and open competition is generally expected to drive competitive pricing and encourage innovation.
Taxpayer Impact: Full and open competition is the most favorable scenario for taxpayers, as it theoretically leads to the best value through a wider pool of potential offerors and a more robust price discovery process.
Public Impact
The Department of the Navy benefits from specialized engineering expertise to support its missions. This contract likely supports various naval projects, potentially including design, development, and sustainment of systems. The geographic impact is primarily centered around the contractor's location in Maryland, but the services could support naval operations globally. The contract supports a workforce of engineers and technical specialists, contributing to the skilled labor market in the defense sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee (CPFF) contract type can incentivize cost overruns if not closely monitored.
- Lack of specific details on the scope of work makes it difficult to assess true value for money.
- Continuation of a prior award might indicate a lack of new innovative solutions being sought.
Positive Signals
- Awarded under full and open competition, suggesting a competitive process.
- Science Applications International Corporation is a large, established defense contractor with significant experience.
- The contract addresses a clear need for engineering services within the Department of the Navy.
Sector Analysis
The engineering services sector within the defense industry is a substantial market, characterized by complex requirements and high barriers to entry. Companies like Science Applications International Corporation (SAIC) are key players, providing a wide range of technical and engineering support to government agencies. This contract, falling under NAICS code 541330 (Engineering Services), fits within this broader landscape. Comparable spending benchmarks would typically be assessed against other large-scale engineering support contracts awarded by the Department of Defense or other federal agencies for similar types of services.
Small Business Impact
The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a large prime contract awarded to a major defense contractor, the primary impact on small businesses would likely be through subcontracting opportunities. The extent to which SAIC engages small businesses as subcontractors for specialized services or components would determine the direct benefit to the small business ecosystem. Without specific subcontracting plans or performance data, it's difficult to quantify this impact.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. The Cost Plus Fixed Fee (CPFF) nature of the award necessitates robust financial oversight to ensure that costs are reasonable and allocable to the contract. Transparency is typically managed through contract reporting mechanisms and performance reviews. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract's execution.
Related Government Programs
- Naval Sea Systems Command (NAVSEA) Contracts
- Department of Defense Engineering Services
- Defense Contract Management Agency (DCMA) Oversight
- Cost Plus Fixed Fee Contracts
- Engineering and Technical Services
Risk Flags
- Cost Plus Fixed Fee contract type carries inherent risk of cost growth.
- Limited detail on specific scope of work hinders comprehensive value assessment.
- Continuation contract may indicate a lack of competitive re-evaluation for new solutions.
Tags
defense, department-of-the-navy, engineering-services, cost-plus-fixed-fee, full-and-open-competition, continuation-contract, science-applications-international-corporation, maryland, delivery-order, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $119.9 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. CONTINUATION CONTRACT OF N00178-04-D-4143 M804
Who is the contractor on this award?
The obligated recipient is SCIENCE APPLICATIONS INTERNATIONAL CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $119.9 million.
What is the period of performance?
Start: 2011-07-07. End: 2014-03-31.
What is the specific scope of engineering services provided under this contract?
The provided data identifies the contract as a 'CONTINUATION CONTRACT OF N00178-04-D-4143 M804' for 'Engineering Services' under NAICS code 541330, awarded to Science Applications International Corporation (SAIC) by the Department of the Navy. However, the specific details of the engineering services rendered are not elaborated in the provided data. Typically, such contracts can encompass a wide range of activities including systems engineering, design, analysis, testing, integration, and lifecycle support for naval platforms, weapons systems, or other defense-related technologies. Without access to the contract statement of work (SOW) or delivery order details, a precise definition of the services remains elusive. The continuation aspect suggests these are ongoing requirements.
How does the pricing structure (Cost Plus Fixed Fee) compare to other engineering service contracts of similar scope?
Cost Plus Fixed Fee (CPFF) contracts are common in defense and R&D where the scope of work is not fully defined at the outset or is subject to significant change. In a CPFF contract, the government reimburses the contractor for allowable costs plus a fixed fee representing profit. Compared to fixed-price contracts, CPFF can offer more flexibility for evolving requirements but carries a higher risk of cost growth if not managed diligently. For complex, long-term engineering projects where innovation and adaptation are key, CPFF can be appropriate. However, if the scope is well-defined and risks are manageable, fixed-price contracts often provide better value by incentivizing contractor efficiency. Benchmarking requires comparing the fee percentage and total cost against similar projects with comparable risk profiles and defined scopes.
What is Science Applications International Corporation's track record with similar Department of the Navy contracts?
Science Applications International Corporation (SAIC) is a major defense contractor with extensive experience supporting the Department of the Navy across various domains. SAIC has a long history of performing complex engineering, IT, and technical services for naval programs. While this specific award is a continuation, SAIC has likely managed numerous similar contracts involving systems engineering, platform modernization, and technical support for naval assets. A detailed review of SAIC's past performance on similar contracts, including any past performance evaluations, contract modifications, and dispute history, would be necessary to fully assess their track record for this specific type of work. Generally, their large size and established presence suggest a capacity to handle such requirements.
What are the potential risks associated with this contract, and how are they being mitigated?
Key risks associated with this contract include potential cost overruns due to the Cost Plus Fixed Fee (CPFF) structure, scope creep if the requirements are not tightly managed, and performance issues if the contractor fails to deliver the expected engineering expertise. Mitigation strategies typically involve robust government oversight, including detailed cost monitoring and auditing by the Defense Contract Management Agency (DCMA) and the contracting officer's representatives (CORs). Clear definition and management of the Statement of Work (SOW), regular performance reviews, and adherence to contract milestones are crucial. The continuation of a prior award might suggest that initial risks were managed adequately, but ongoing vigilance is essential.
How does this contract's value compare to historical spending on engineering services by the Department of the Navy?
The award of approximately $120 million for engineering services represents a significant, but not extraordinary, investment for the Department of the Navy, given the scale and complexity of naval operations and systems. The Department of the Navy consistently spends billions of dollars annually on a wide array of services, including engineering, research and development, maintenance, and IT support. To provide a precise comparison, one would need to analyze historical spending trends for similar engineering services contracts (e.g., by NAICS code 541330) awarded by the Navy over several fiscal years. This contract's value should be viewed within the context of the Navy's overall budget allocation for technical and engineering support, which fluctuates based on strategic priorities and program requirements.
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: N0002411R3390
Offers Received: 1
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: $124,605,621
Exercised Options: $124,605,621
Current Obligation: $119,893,555
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0017804D4143
IDV Type: IDC
Timeline
Start Date: 2011-07-07
Current End Date: 2014-03-31
Potential End Date: 2014-03-31 00:00:00
Last Modified: 2022-08-10
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