DoD's $335.8M Engineering Services Contract with PAE Applied Technologies LLC: A Deep Dive
Contract Overview
Contract Amount: $335,787,426 ($335.8M)
Contractor: PAE Applied Technologies LLC
Awarding Agency: Department of Defense
Start Date: 2001-12-20
End Date: 2007-10-22
Contract Duration: 2,132 days
Daily Burn Rate: $157.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Place of Performance
Location: PATUXENT RIVER, SAINT MARYS County, MARYLAND, 20670
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $335.8 million to PAE APPLIED TECHNOLOGIES LLC for work described as: Key points: 1. Contract awarded through full and open competition, suggesting a robust market for these services. 2. The contract's duration of 2132 days (approx. 5.8 years) indicates a long-term need for engineering support. 3. Cost-plus-fixed-fee pricing structure may incentivize contractor efficiency to maximize profit. 4. The significant award amount suggests a high level of complexity and criticality for the engineering services provided. 5. Performance was managed by the Defense Contract Management Agency, a key oversight body for DoD contracts. 6. The contract's focus on engineering services (NAICS 541330) aligns with critical defense infrastructure and operational support needs.
Value Assessment
Rating: good
Benchmarking the value of this $335.8 million contract is challenging without specific performance metrics or comparable service details. However, the duration of over five years suggests a sustained need and potentially a competitive pricing environment at the time of award. The cost-plus-fixed-fee structure requires careful monitoring to ensure costs remain reasonable and the fixed fee is justified by the scope of work. Without more granular data on the specific engineering services rendered and their outcomes, a definitive value assessment is limited.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. This approach typically fosters a competitive environment, potentially leading to better pricing and service quality for the government. The number of bidders is not specified, but the use of full and open competition suggests a healthy market for these engineering services.
Taxpayer Impact: A full and open competition generally benefits taxpayers by promoting a wider range of offers and potentially driving down costs through market forces, ensuring the government receives the best value.
Public Impact
The Department of Defense benefits from specialized engineering expertise to support its complex operations and infrastructure. Services likely include design, analysis, testing, and technical support for various defense systems and projects. The geographic impact is likely concentrated around defense installations or operational areas requiring engineering support. The contract supports a workforce of engineers and technical specialists, contributing to the defense industrial base.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts can lead to cost overruns if not closely managed.
- Long contract durations may reduce flexibility to adapt to changing technological needs or requirements.
- The specific engineering services and their impact on mission success require ongoing evaluation.
Positive Signals
- Awarded through full and open competition, indicating a competitive market.
- Managed by the Defense Contract Management Agency, ensuring oversight.
- The contract addresses a long-term need for critical engineering services.
Sector Analysis
This contract falls within the Engineering Services sector (NAICS 541330), a critical component of the broader professional, scientific, and technical services industry. This sector is vital for national security, supporting the design, development, and maintenance of complex defense systems and infrastructure. Spending in this area is often substantial due to the intricate nature of defense projects. Comparable spending benchmarks would typically involve other large-scale engineering support contracts awarded by the Department of Defense or other federal agencies for similar complex technical requirements.
Small Business Impact
The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large-value definitive contract awarded under full and open competition, it is unlikely to have specific small business set-aside provisions. However, the prime contractor, PAE Applied Technologies LLC, may engage small businesses as subcontractors to fulfill parts of the contract, contributing to the small business ecosystem. Further analysis of subcontracting plans would be needed to assess the direct impact on small businesses.
Oversight & Accountability
The Defense Contract Management Agency (DCMA) is responsible for overseeing this contract, ensuring compliance with terms and conditions, and monitoring performance. As a definitive contract, it is subject to standard federal procurement regulations and oversight mechanisms. Transparency regarding specific deliverables and performance metrics would be key to a full assessment of accountability.
Related Government Programs
- Department of Defense Engineering Support Contracts
- Professional, Scientific, and Technical Services
- Defense Contract Management Agency Oversight
- Cost-Plus-Fixed-Fee Contracts
Risk Flags
- Potential for cost overruns inherent in CPFF contracts.
- Long contract duration may limit adaptability to evolving technological needs.
- Need for robust oversight to ensure cost efficiency and performance.
Tags
defense, department-of-defense, engineering-services, definitive-contract, full-and-open-competition, cost-plus-fixed-fee, maryland, large-contract, professional-scientific-and-technical-services, dcma
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $335.8 million to PAE APPLIED TECHNOLOGIES LLC. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is PAE APPLIED TECHNOLOGIES LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $335.8 million.
What is the period of performance?
Start: 2001-12-20. End: 2007-10-22.
What was the specific nature of the engineering services provided under this contract?
The contract falls under NAICS code 541330, which designates 'Engineering Services.' While the specific details are not provided in the abbreviated data, this typically encompasses a wide range of activities such as research and development, design, analysis, testing, and technical support for military systems, platforms, and infrastructure. Given the substantial award amount and the Department of Defense as the agency, these services likely supported complex defense projects, potentially involving weapon systems, aerospace, naval engineering, or critical infrastructure development and maintenance. The 'DEFINITIVE CONTRACT' type suggests it was used to procure a broad range of services over its duration, rather than a single, specific project.
How does the $335.8 million award compare to similar engineering services contracts within the Department of Defense?
The $335.8 million award for engineering services is a significant sum, indicative of a large-scale, long-term requirement. Within the Department of Defense, contracts of this magnitude are not uncommon for major system support, research, development, and sustainment activities. To provide a precise comparison, one would need to analyze the average award values for similar NAICS codes (541330) over comparable contract durations (over 5 years) awarded by the DoD in the same period. However, generally speaking, contracts in the hundreds of millions of dollars for specialized engineering support are typical for major defense programs requiring extensive technical expertise and long-term commitment.
What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract of this size and duration?
The primary risk with a Cost Plus Fixed Fee (CPFF) contract, especially one valued at $335.8 million over nearly six years, is the potential for cost overruns. While the 'fixed fee' component provides a ceiling on the contractor's profit, the government bears the risk of all allowable costs incurred. If the contractor is inefficient or encounters unforeseen complexities, the total cost to the government can escalate significantly beyond initial projections. Effective oversight by the Defense Contract Management Agency (DCMA) is crucial to scrutinize allowable costs, prevent waste, and ensure the contractor exercises due diligence in managing expenses. Another risk is scope creep, where the definition of 'allowable costs' might expand over time without adequate adjustments to the overall value or fee.
What does the contract's duration of 2132 days imply about the nature of the engineering services required?
A contract duration of 2132 days, approximately 5.8 years, strongly suggests that the engineering services required were for long-term support, sustainment, or development programs rather than short-term projects. This extended timeframe implies a stable, ongoing need for specialized technical expertise. It could relate to the lifecycle support of a major defense system, continuous research and development efforts, or the provision of ongoing engineering services integral to the operational readiness or strategic planning of the Department of Defense. Such durations often indicate complex requirements that cannot be fulfilled within a shorter period and necessitate a sustained relationship with the contractor.
How does the 'full and open competition' award type influence the potential value for taxpayers?
Awarding a contract through 'full and open competition' is generally beneficial for taxpayers. It means that the government solicited bids from all responsible sources, maximizing the pool of potential offerors. This increased competition typically drives down prices as contractors vie for the award. It also encourages innovation and efficiency, as companies strive to present the most compelling technical and cost proposals. For taxpayers, this process increases the likelihood that the government will secure the required engineering services at a fair and reasonable price, thereby optimizing the use of public funds and ensuring the best possible value is obtained for the $335.8 million investment.
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
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Contractor Details
Address: 1320 N COURTHOUSE RD STE 700, ARLINGTON, VA, 22201
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2001-12-20
Current End Date: 2007-10-22
Potential End Date: 2007-10-22 00:00:00
Last Modified: 2024-11-05
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