DoD's $18.9M Engineering Services Contract with VSOLVIT LLC Shows Fair Value Amidst Full Competition

Contract Overview

Contract Amount: $18,939,359 ($18.9M)

Contractor: Vsolvit LLC

Awarding Agency: Department of Defense

Start Date: 2018-09-07

End Date: 2024-12-31

Contract Duration: 2,307 days

Daily Burn Rate: $8.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF

Place of Performance

Location: NORCO, RIVERSIDE County, CALIFORNIA, 92860

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $18.9 million to VSOLVIT LLC for work described as: IGF::OT::IGF Key points: 1. Contract awarded through full and open competition, suggesting competitive pricing. 2. The contract duration of approximately 6.3 years provides long-term support. 3. Engineering services are critical for defense readiness and modernization. 4. The contract's value is moderate within the broader defense engineering sector. 5. Performance is tracked under the Navy's strategic acquisition framework. 6. No small business set-aside indicates a focus on large-scale capabilities.

Value Assessment

Rating: good

The contract's value of approximately $18.9 million over its period of performance appears reasonable when benchmarked against similar large-scale engineering services contracts awarded by the Department of Defense. The cost-plus-fixed-fee (CPFF) pricing structure, while offering flexibility, requires careful oversight to ensure costs remain controlled. Without specific performance metrics or detailed cost breakdowns, a definitive value-for-money assessment is challenging, but the competitive award process provides a baseline for fair pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders were likely solicited and evaluated. This approach generally fosters a competitive environment, driving down prices and encouraging innovation. The presence of a single award for this delivery order suggests VSOLVIT LLC was the most advantageous offer, but the initial competition likely involved several capable firms.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it maximizes the potential for obtaining the best value through a wide range of offers, leading to more efficient use of public funds.

Public Impact

The Department of the Navy benefits from specialized engineering expertise to support its operations and maintenance. This contract delivers essential engineering services crucial for naval readiness and technological advancement. The geographic impact is primarily within California, where the contractor is based, but services may extend to various naval installations. 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

Potential for cost overruns inherent in CPFF contracts if not rigorously managed.
Reliance on a single contractor for a significant duration could pose risks if performance degrades.
Limited visibility into the specific technical challenges and their cost implications without detailed reporting.

Positive Signals

Awarded through full and open competition, indicating a robust selection process.
Contractor has a track record with the government, suggesting familiarity with requirements.
Long contract duration allows for sustained focus and development of specialized knowledge.

Sector Analysis

The engineering services sector within the federal government is substantial, encompassing a wide array of technical support for defense, infrastructure, and research. This $18.9 million contract falls within the mid-range for specialized engineering support for defense agencies. Comparable spending often involves large prime contractors and numerous subcontractors, reflecting the complexity and breadth of defense engineering needs. The NAICS code 541330 (Engineering Services) is a broad category, and this contract likely represents a specific niche within naval engineering.

Small Business Impact

The absence of small business set-aside provisions for this contract suggests that the scope and complexity of the engineering services required were deemed best met by larger, potentially more specialized firms. While VSOLVIT LLC may utilize small businesses as subcontractors, the primary award was not designated for small business participation. This approach is common for contracts requiring extensive resources or highly specialized expertise that may be more readily available from larger entities.

Oversight & Accountability

Oversight for this contract is likely managed by the Department of the Navy's contracting and program management offices. Accountability measures would include performance reviews, milestone tracking, and financial audits, particularly given the Cost Plus Fixed Fee structure. Transparency is generally maintained through contract award databases and reporting requirements, though specific operational details may be sensitive. The Inspector General's office for the Department of Defense would have jurisdiction for audits and investigations if any irregularities were suspected.

Related Government Programs

Department of Defense Engineering Services
Naval Sea Systems Command Contracts
Defense Professional Services
Engineering and Technical Support Services

Risk Flags

Cost Plus Fixed Fee contract structure requires diligent oversight to manage potential cost overruns.
Long contract duration could pose performance continuity risks if contractor performance declines.
Lack of specific performance metrics in provided data limits detailed value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $18.9 million to VSOLVIT LLC. IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is VSOLVIT 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 $18.9 million.

What is the period of performance?

Start: 2018-09-07. End: 2024-12-31.

What is VSOLVIT LLC's past performance record with the Department of Defense, particularly on similar engineering services contracts?

VSOLVIT LLC has a history of performing contracts with the Department of Defense, including various engineering and technical support services. While specific details on past performance metrics for this particular contract are not publicly detailed in the provided data, government contracting databases often contain performance evaluations (e.g., CPARS reports) that inform future award decisions. A review of these reports would indicate their track record in meeting cost, schedule, and technical requirements on previous engagements. Generally, contractors with a positive performance history are favored in competitive procurements, suggesting VSOLVIT's prior success likely played a role in securing this award.

How does the estimated cost per year for this contract compare to industry benchmarks for similar engineering services?

The contract's total value of approximately $18.9 million over roughly 6.3 years (from September 2018 to December 2024) equates to an average annual cost of about $3 million. Benchmarking this against industry standards for specialized engineering services within the defense sector requires detailed analysis of the specific services rendered. Factors such as the level of expertise required, security clearances, and the complexity of the naval systems involved significantly influence per-year costs. Generally, for highly specialized defense engineering, this annual figure appears within a reasonable range, especially considering the competitive award process. However, a precise comparison would necessitate a detailed breakdown of labor categories, hours, and overhead rates against market data for comparable roles and services.

What are the primary risks associated with this Cost Plus Fixed Fee (CPFF) contract structure for the government?

The primary risk for the government with a CPFF contract is the potential for cost overruns. While the contractor is paid their actual allowable costs plus a fixed fee, the 'cost' component is variable. If the contractor's costs exceed initial estimates, the government bears that expense. This necessitates robust government oversight to ensure costs are reasonable, allocable, and allowable. The fixed fee provides an incentive for the contractor to control costs to some extent, as it does not increase with actual costs, but the government still assumes the bulk of the cost risk. Effective management requires diligent monitoring of expenditures, regular audits, and clear communication to prevent scope creep and manage unforeseen technical challenges.

What is the strategic importance of these engineering services to the Department of the Navy's mission?

Engineering services are fundamental to the Department of the Navy's mission, underpinning the design, development, maintenance, and modernization of its complex platforms and systems. This contract likely supports critical functions such as naval architecture, systems engineering, combat systems integration, or lifecycle support for naval vessels and equipment. Ensuring the operational readiness, technological superiority, and safety of naval assets relies heavily on the quality and timeliness of engineering expertise. Therefore, securing reliable and competent engineering support through contracts like this is strategically vital for maintaining naval power projection capabilities and adapting to evolving threats.

How has spending on engineering services within the Department of the Navy trended over the past five years?

Spending on engineering services within the Department of the Navy has generally remained substantial over the past five years, reflecting ongoing modernization efforts, fleet maintenance requirements, and the development of new platforms and technologies. While specific aggregate figures fluctuate based on budget allocations and program priorities, the demand for specialized engineering expertise remains consistently high. Trends often show increased investment in areas like cybersecurity, artificial intelligence integration, and advanced materials, alongside traditional naval engineering disciplines. The overall trend indicates a sustained commitment to leveraging external engineering capabilities to support its vast and complex operational needs.

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 › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N6426718R3009

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 4171 MARKET STREET SUITE 2, VENTURA, CA, 93003

Business Categories: 8(a) Program Participant, Category Business, DoT Certified Disadvantaged Business Enterprise, Economically Disadvantaged Women Owned Small Business, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $19,087,336

Exercised Options: $19,087,336

Current Obligation: $18,939,359

Actual Outlays: $3,697,860

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017815D8491

IDV Type: IDC

Timeline