DoD's $60M Contract for Program Management and IT Services Awarded to Serco Inc

Contract Overview

Contract Amount: $59,989,475 ($60.0M)

Contractor: Serco Inc

Awarding Agency: Department of Defense

Start Date: 2021-06-30

End Date: 2026-10-14

Contract Duration: 1,932 days

Daily Burn Rate: $31.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: NON-PERSONAL CONTRACTOR SERVICES TO PROVIDE PROGRAM MANAGEMENT, ACQUISITION, ENGINEERING, TECHNICAL, TEST AND EVALUATION, PRODUCTION MANAGEMENT, INFORMATION TECHNOLOGY, AND POST-DELIVERY IN SUPPORT OF PMS 317'S MISSION AND OBJECTIVES.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20003

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $60.0 million to SERCO INC for work described as: NON-PERSONAL CONTRACTOR SERVICES TO PROVIDE PROGRAM MANAGEMENT, ACQUISITION, ENGINEERING, TECHNICAL, TEST AND EVALUATION, PRODUCTION MANAGEMENT, INFORMATION TECHNOLOGY, AND POST-DELIVERY IN SUPPORT OF PMS 317'S MISSION AND OBJECTIVES. Key points: 1. Significant contract value of $59.9M for comprehensive support services. 2. Serco Inc. is the sole awardee under full and open competition. 3. Contract spans multiple critical areas including program management, IT, and engineering. 4. Potential for cost overruns given the Cost Plus Fixed Fee structure.

Value Assessment

Rating: fair

The Cost Plus Fixed Fee (CPFF) contract type allows for costs to exceed estimates, with the fee remaining fixed. This can lead to higher overall spending than anticipated if costs are not well-managed. Benchmarking CPFF contracts for similar services is difficult without detailed cost breakdowns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a robust price discovery process. However, the specific award mechanism (Delivery Order) within a larger contract framework needs further examination to understand the competitive landscape for this specific order.

Taxpayer Impact: Taxpayer funds are being used for extensive support services. The CPFF structure necessitates vigilant oversight to ensure cost efficiency and prevent unnecessary expenditure.

Public Impact

Ensures critical program management and technical expertise for naval missions. Supports advanced capabilities in IT, engineering, and acquisition. Potential impact on the efficiency and effectiveness of naval program execution.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) structure can lead to cost overruns.
Lack of small business participation noted.
Long contract duration (over 4 years) increases risk exposure.

Positive Signals

Awarded under full and open competition.
Provides comprehensive support across multiple critical domains.
Supports a key Department of Defense mission.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), supporting the Department of Defense. Spending in this sector is substantial, driven by complex defense acquisition programs requiring specialized technical and managerial expertise.

Small Business Impact

The data indicates that small businesses were not involved in this specific award (ss: false, sb: false). This represents a missed opportunity to leverage small business capabilities and potentially foster innovation within the defense contracting ecosystem.

Oversight & Accountability

The CPFF contract type requires robust oversight to manage costs effectively. The Department of the Navy must ensure stringent monitoring of expenditures and performance to hold Serco Inc. accountable for delivering value within the fixed fee.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Cost Overruns Risk (CPFF)
Lack of Small Business Participation
Long Contract Duration
Potential for Scope Creep
Dependency on Contractor Performance

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $60.0 million to SERCO INC. NON-PERSONAL CONTRACTOR SERVICES TO PROVIDE PROGRAM MANAGEMENT, ACQUISITION, ENGINEERING, TECHNICAL, TEST AND EVALUATION, PRODUCTION MANAGEMENT, INFORMATION TECHNOLOGY, AND POST-DELIVERY IN SUPPORT OF PMS 317'S MISSION AND OBJECTIVES.

Who is the contractor on this award?

The obligated recipient is SERCO 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 $60.0 million.

What is the period of performance?

Start: 2021-06-30. End: 2026-10-14.

What specific program management and technical challenges does this contract aim to address for PMS 317?

This contract is designed to provide comprehensive support for PMS 317's mission, encompassing program management, acquisition, engineering, technical services, test and evaluation, production management, IT, and post-delivery support. It aims to ensure the efficient and effective execution of complex naval programs by leveraging specialized contractor expertise in these critical areas.

How will the Department of the Navy mitigate the inherent cost risks associated with a Cost Plus Fixed Fee contract?

Mitigation strategies likely involve rigorous cost tracking, performance metrics, and regular audits. The Navy will need to closely monitor all incurred costs against the fixed fee, ensuring that Serco Inc. operates efficiently and justifies all expenditures. Clear performance standards and deliverables are crucial for accountability.

What is the expected impact of this contract on the overall effectiveness of PMS 317's objectives?

The contract is expected to enhance PMS 317's effectiveness by providing essential expertise and manpower that may not be available internally. By outsourcing these specialized functions, the Navy can potentially accelerate program timelines, improve technical outcomes, and ensure the successful delivery of critical naval capabilities.

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: N0016419R3502

Offers Received: 4

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 12930 WORLDGATE DR STE 600, HERNDON, VA, 20170

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

Financial Breakdown

Contract Ceiling: $69,363,878

Exercised Options: $69,363,878

Current Obligation: $59,989,475

Subaward Activity

Number of Subawards: 12

Total Subaward Amount: $24,876,814

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017819D8498

IDV Type: IDC

Timeline