DoD's $12.2M RDT&E contract for engineering services awarded to Sabre Systems, LLC, lacked competition

Contract Overview

Contract Amount: $12,203,680 ($12.2M)

Contractor: Sabre Systems, LLC

Awarding Agency: Department of Defense

Start Date: 2008-02-05

End Date: 2013-05-15

Contract Duration: 1,926 days

Daily Burn Rate: $6.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: RDT&E INFRASTRUCTURE DIVISION LABOR

Place of Performance

Location: PATUXENT RIVER, ST. MARY'S County, MARYLAND, 20670

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $12.2 million to SABRE SYSTEMS, LLC for work described as: RDT&E INFRASTRUCTURE DIVISION LABOR Key points: 1. Contract awarded on a sole-source basis, raising questions about potential overpayment and lack of market-driven pricing. 2. The firm fixed-price contract type suggests cost certainty but does not guarantee value for money without competitive pressure. 3. Long contract duration of 1926 days (over 5 years) indicates a significant, ongoing need for these engineering services. 4. Awarded by the Department of the Navy, this contract falls under Research, Development, Test, and Evaluation (RDT&E) infrastructure. 5. The absence of competition limits transparency and potentially reduces the government's ability to secure the best possible pricing. 6. Contractor Sabre Systems, LLC, received a substantial award, highlighting its role in supporting critical defense infrastructure.

Value Assessment

Rating: questionable

Without a competitive bidding process, it is difficult to benchmark the value for money of this $12.2 million contract. The firm fixed-price structure provides cost certainty for the government, but the lack of competition means the government may not have benefited from the most competitive pricing available in the market. A sole-source award often implies unique capabilities or a lack of available alternatives, but without further justification, it raises concerns about whether a fair and reasonable price was achieved compared to what could have been obtained through open competition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This indicates that the Department of the Navy likely identified a single contractor, Sabre Systems, LLC, believed to possess the necessary specialized skills or capabilities for the RDT&E infrastructure engineering services. The lack of competition means there were no other bidders, and therefore no direct price comparison or negotiation leverage derived from a competitive market.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as the government does not benefit from the price reductions typically driven by competitive bidding. This limits the government's ability to ensure it is receiving the best possible value for its investment.

Public Impact

The primary beneficiaries are the Department of Defense and the Department of the Navy, receiving specialized engineering services for RDT&E infrastructure. The contract supports the development and maintenance of critical research, development, test, and evaluation infrastructure, essential for national security. The geographic impact is centered in Maryland (ST: MD, SN: MARYLAND), where the contractor is located and likely where the services are performed. The contract supports specialized engineering roles, potentially impacting the workforce in the engineering and defense contracting sectors within Maryland.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may have resulted in a higher price than could have been achieved through a competitive process.
Sole-source awards can reduce transparency and accountability in government spending.
Long contract duration without re-competition could lead to complacency or reduced incentive for cost efficiency over time.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to a single contractor suggests specialized expertise was identified as necessary for the requirement.
Contract supports critical RDT&E infrastructure, aligning with defense priorities.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS code 541330), a significant segment of the professional services market supporting government and private industry. The defense sector, in particular, relies heavily on engineering services for research, development, and infrastructure projects. Comparable spending in this area can vary widely based on project scope and duration, but contracts exceeding $10 million for specialized RDT&E support are common within large federal agencies like the Department of Defense. The market for these services is competitive, making the sole-source nature of this award notable.

Small Business Impact

There is no indication that this contract included a small business set-aside. The award was made to Sabre Systems, LLC, and the data does not specify if they are a small or large business. Furthermore, there is no information regarding subcontracting plans for small businesses. Without specific set-aside provisions or subcontracting goals, the direct impact on the small business ecosystem from this particular award is unclear, though large prime contractors often utilize small businesses for specialized support.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. As a sole-source award, it may have undergone specific justification and approval processes to ensure necessity and fair pricing, though the lack of competition limits external oversight. Transparency is reduced due to the non-competitive nature. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected or alleged during the contract's performance or closeout.

Related Government Programs

Department of Defense RDT&E Spending
Navy Engineering and Technical Services Contracts
Sole-Source Defense Contract Awards
Infrastructure Support Services Contracts

Risk Flags

Sole-source award
Lack of competition
Potential for inflated pricing
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.2 million to SABRE SYSTEMS, LLC. RDT&E INFRASTRUCTURE DIVISION LABOR

Who is the contractor on this award?

The obligated recipient is SABRE SYSTEMS, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $12.2 million.

What is the period of performance?

Start: 2008-02-05. End: 2013-05-15.

What specific engineering services were provided under this contract?

The contract data indicates the service category as 'RDT&E INFRASTRUCTURE DIVISION LABOR' and the NAICS code 541330 points to 'Engineering Services'. While specific details are not provided in the summary data, this typically encompasses a range of activities such as design, analysis, testing, and technical support related to the infrastructure used for Research, Development, Test, and Evaluation (RDT&E) purposes within the Department of the Navy. This could include support for facilities, equipment, systems, or processes integral to defense research and development efforts.

Why was this contract awarded on a sole-source basis?

The provided data states the contract was 'NOT COMPETED', indicating a sole-source award. Specific justifications for sole-source awards typically include that only one responsible source is available or capable of providing the required services, or that there is a compelling urgency. For RDT&E infrastructure, this could stem from highly specialized technical requirements, proprietary knowledge, or a unique integration need with existing systems that only Sabre Systems, LLC could fulfill. A formal justification and approval document (J&A) would normally be required to document the rationale for bypassing full and open competition.

How does the $12.2 million award compare to typical spending on similar engineering services by the Navy?

The $12.2 million total award for a contract spanning over 5 years (1926 days) represents a significant investment in engineering services. While 'typical' spending varies greatly depending on the specific nature of RDT&E infrastructure and the scope of services, this amount is substantial. Without access to a broader dataset of comparable Navy RDT&E engineering contracts, a precise benchmark is difficult. However, given the sole-source nature and the duration, it suggests a critical and potentially unique requirement. The average annual value is approximately $2.4 million, which is a considerable sum for specialized engineering labor.

What is the track record of Sabre Systems, LLC with the Department of Defense?

Sabre Systems, LLC has a history of contracting with the Department of Defense. While this specific contract highlights a sole-source award for RDT&E infrastructure labor, the company likely holds other contracts across various defense agencies and branches. A comprehensive review of their contract history would reveal the types of services they provide, their performance ratings on past contracts (if available), and the total value of contracts awarded to them over time. This information would provide a clearer picture of their overall track record and capabilities within the defense sector.

What are the potential risks associated with a sole-source contract of this duration?

The primary risks associated with a sole-source contract, especially one lasting over five years, include potential cost overruns if pricing was not adequately negotiated, reduced incentive for the contractor to innovate or improve efficiency, and a lack of market validation for the services provided. There's also a risk that the government becomes overly reliant on a single provider. Furthermore, without competition, the government misses opportunities to discover potentially more cost-effective solutions or alternative providers that may emerge over the contract's life.

Does the firm fixed-price contract type mitigate the risks of cost overruns?

A firm fixed-price (FFP) contract is designed to provide cost certainty for the government, meaning the price is set and generally not subject to adjustment based on the contractor's cost experience. This shifts the risk of cost overruns to the contractor. However, in a sole-source scenario, the initial fixed price itself could be inflated if not rigorously negotiated against market benchmarks or competitive offers. Therefore, while the FFP structure protects against cost increases *after* the price is set, it does not guarantee the initial price was the best possible value without competition.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0042108R0022

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 65 W ST RD STE A 200, WARMINSTER, PA, 01

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $17,793,235

Exercised Options: $17,793,235

Current Obligation: $12,203,680

Contract Characteristics

Cost or Pricing Data: YES

Timeline