DoD awards $31.8M engineering services task order to SMARTRONIX, LLC for 4-year period

Contract Overview

Contract Amount: $31,774,719 ($31.8M)

Contractor: Smartronix, LLC

Awarding Agency: Department of Defense

Start Date: 2022-07-01

End Date: 2026-06-30

Contract Duration: 1,460 days

Daily Burn Rate: $21.8K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: TARCES NON-DOD TASK ORDER

Place of Performance

Location: SAINT INIGOES, SAINT MARYS County, MARYLAND, 20684

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $31.8 million to SMARTRONIX, LLC for work described as: TARCES NON-DOD TASK ORDER Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. Task order is for engineering services, a critical support function for defense operations. 3. The contract type is Cost Plus Fixed Fee, which can incentivize cost control but requires robust oversight. 4. The duration of 4 years indicates a significant, long-term need for these services. 5. The awardee, SMARTRONIX, LLC, is a known entity in the federal contracting space. 6. The contract is a delivery order under a larger contract vehicle, typical for task-based work. 7. No small business set-aside was utilized for this specific task order.

Value Assessment

Rating: fair

Benchmarking the value of this $31.8 million task order requires comparison to similar engineering services contracts within the Department of Defense. Given the Cost Plus Fixed Fee (CPFF) structure, assessing true value-for-money is challenging without detailed cost breakdowns and performance metrics. CPFF contracts can sometimes lead to higher costs if not managed tightly, as the contractor is reimbursed for allowable costs plus a fixed fee. Without specific performance data or comparable bids, it's difficult to definitively state if this represents excellent value, but it falls within a typical range for specialized engineering support.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This task order was awarded under a full and open competition, indicating that all responsible sources were permitted to submit bids. The specific number of bidders is not provided, but this approach generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. The open competition suggests the Navy sought the best possible solution from the widest range of qualified contractors.

Taxpayer Impact: A full and open competition is generally favorable for taxpayers as it maximizes the potential for competitive pricing and ensures the government receives the best value by considering all qualified offerors.

Public Impact

The Department of the Navy benefits from specialized engineering expertise to support its missions. Services delivered likely include design, analysis, testing, and technical support for naval systems or infrastructure. The geographic impact is centered in Maryland, where the contractor is located and likely where services will be performed or managed. This contract supports a portion of the defense industrial workforce, including engineers and technical specialists.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts require diligent oversight to ensure costs remain reasonable and the fixed fee is justified by performance.
Lack of specific performance metrics in the provided data makes it difficult to assess the contractor's historical performance on this specific task order.
The duration of the contract (4 years) presents a long-term financial commitment that warrants ongoing review.

Positive Signals

Awarded through full and open competition, indicating a potentially competitive pricing structure.
The contractor, SMARTRONIX, LLC, is an established entity in the federal contracting market, suggesting experience.
The task order is for engineering services, which are crucial for maintaining and advancing defense capabilities.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), a significant segment of the federal market supporting various government agencies, particularly Defense. The federal government spends billions annually on engineering and technical services, encompassing areas like aerospace, naval, and systems engineering. This task order represents a specific instance of the Department of Defense procuring specialized expertise to fulfill its operational and developmental requirements, fitting within the broader landscape of defense contracting.

Small Business Impact

This task order was not awarded as a small business set-aside, nor does it indicate any specific subcontracting goals for small businesses in the provided data. Therefore, its direct impact on the small business ecosystem is likely limited unless SMARTRONIX, LLC voluntarily engages small businesses as subcontractors. The absence of set-aside provisions means larger, established companies were primarily considered.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract would typically be managed by the contracting officer and the assigned contract specialist or administrative contracting officer (ACO) within the Department of the Navy. Robust oversight would involve regular reviews of incurred costs, justification for the fixed fee, performance monitoring, and adherence to contract terms. Transparency is generally maintained through contract reporting systems, though detailed cost breakdowns may be proprietary. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Engineering Services
Naval Sea Systems Command (NAVSEA) Contracts
Cost Plus Fixed Fee Contracts
Engineering and Technical Services

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight.
Long contract duration (4 years) necessitates ongoing performance monitoring.
Lack of specific performance metrics provided.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $31.8 million to SMARTRONIX, LLC. TARCES NON-DOD TASK ORDER

Who is the contractor on this award?

The obligated recipient is SMARTRONIX, 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 $31.8 million.

What is the period of performance?

Start: 2022-07-01. End: 2026-06-30.

What is the track record of SMARTRONIX, LLC with the Department of Defense, particularly in engineering services?

SMARTRONIX, LLC has a significant history of contracting with the Department of Defense across various agencies and service branches. They have been awarded numerous contracts, including task orders and delivery orders, for a range of services that often include IT, cybersecurity, engineering, and professional support. Their experience with the DoD suggests familiarity with defense requirements, acquisition processes, and security protocols. Analyzing their past performance ratings, any contract disputes, and the types of engineering services they have previously provided to the DoD would offer further insight into their capabilities and reliability for this specific task order. Specific details on their performance on similar engineering services contracts would be crucial for a comprehensive assessment.

How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types for engineering services in terms of value for money?

The Cost Plus Fixed Fee (CPFF) contract type reimburses the contractor for allowable costs incurred, plus a predetermined fixed fee representing profit. This structure is often used when the scope of work is not precisely defined or involves a high degree of uncertainty, making fixed-price contracts impractical. While CPFF can provide flexibility, it carries inherent risks for the government. Unlike fixed-price contracts, where the contractor bears cost overruns, CPFF shifts much of that risk to the government. The 'value for money' is highly dependent on the government's ability to effectively monitor costs, ensure efficiency, and negotiate a reasonable fixed fee. If oversight is weak, costs can escalate beyond what might be achieved with a firm-fixed-price contract, potentially diminishing value. However, for complex, R&D-intensive, or evolving engineering needs, CPFF can ensure the government accesses necessary expertise without stifling innovation due to rigid cost constraints.

What are the potential risks associated with a 4-year engineering services contract awarded via full and open competition?

A significant risk with a 4-year engineering services contract, even one awarded through full and open competition, is the potential for cost growth beyond initial estimates, particularly with a CPFF structure. While competition aims for best value, unforeseen technical challenges, scope creep, or changes in government requirements over four years can lead to increased costs. Another risk is contractor performance degradation over time or a decline in the quality of services if not continuously monitored. Furthermore, the market for specialized engineering talent can fluctuate; if the contractor struggles to retain key personnel, service continuity could be jeopardized. Finally, the government risks locking into a specific technological approach or vendor for an extended period, potentially missing out on more innovative or cost-effective solutions that emerge later in the contract lifecycle.

How does the engineering services spending by the Department of the Navy compare to other branches or agencies?

The Department of the Navy consistently represents a substantial portion of the Department of Defense's overall spending, and this includes significant investment in engineering and technical services. Compared to other branches like the Army or Air Force, the Navy's unique operational environment (maritime) necessitates specialized engineering expertise for shipbuilding, naval aviation, submarine technology, and shore infrastructure. While all branches require extensive engineering support, the Navy's focus on complex platforms like aircraft carriers, submarines, and surface vessels often translates into large-scale, long-term engineering contracts. Benchmarking this $31.8 million task order against the Navy's total engineering services budget, or comparing it to similar contracts awarded by NAVSEA or Naval Air Systems Command, would provide better context on its relative scale and importance within the Navy's overall procurement strategy.

What are the implications of awarding a delivery order versus a standalone contract for engineering services?

Awarding this as a delivery order (DO) under a larger contract vehicle (like an IDIQ - Indefinite Delivery/Indefinite Quantity contract) has several implications. It signifies that the foundational contract, under which this DO was issued, likely underwent a broader competition and established terms and conditions. Delivery orders allow agencies to procure specific quantities of supplies or services as needed, offering flexibility and faster acquisition compared to initiating a new standalone contract for each requirement. For taxpayers, this can mean more efficient procurement processes and potentially better pricing if the underlying contract vehicle was competitively awarded. However, it also means the oversight and value assessment need to consider both the specific DO and the overarching contract it falls under. The existence of a parent contract suggests a pre-established relationship and framework for service delivery.

Industry Classification

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

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - NETWORK

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0042121R0116

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 44150 SMARTRONIX WAY STE 200, HOLLYWOOD, MD, 20636

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $36,240,426

Exercised Options: $36,240,284

Current Obligation: $31,774,719

Actual Outlays: $2,177,625

Subaward Activity

Number of Subawards: 24

Total Subaward Amount: $309,758,458

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0042122D0005

IDV Type: IDC

Timeline