DoD's $134M professional services contract with Parsons Government Services awarded without competition

Contract Overview

Contract Amount: $13,420,400 ($13.4M)

Contractor: Parsons Government Services International Inc.

Awarding Agency: Department of Defense

Start Date: 2005-09-16

End Date: 2011-11-30

Contract Duration: 2,266 days

Daily Burn Rate: $5.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS AWARD FEE

Sector: Other

Plain-Language Summary

Department of Defense obligated $13.4 million to PARSONS GOVERNMENT SERVICES INTERNATIONAL INC. for work described as: Key points: 1. Contract awarded on a cost-plus basis, potentially leading to higher final costs than fixed-price agreements. 2. Lack of competition suggests potential for inflated pricing and reduced value for taxpayer dollars. 3. Long contract duration of over 6 years indicates a significant, ongoing need for services. 4. The 'All Other Professional, Scientific, and Technical Services' NAICS code is broad, making direct comparisons difficult. 5. Contractor, Parsons Government Services International Inc., has a substantial history with the government, implying established relationships. 6. The absence of small business set-asides raises questions about opportunities for smaller firms in this contract.

Value Assessment

Rating: questionable

The contract's cost-plus award fee structure, combined with a lack of competition, makes a definitive value assessment challenging. Without a competitive bidding process, it's difficult to benchmark pricing against market rates or similar government contracts. The extended duration and the broad nature of the services provided further complicate a precise value-for-money analysis. However, cost-plus contracts inherently carry a higher risk of cost overruns compared to fixed-price contracts, suggesting a potentially less favorable value proposition for the government.

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 among multiple vendors. This approach is typically used when only one vendor can provide the required services or in urgent situations. The lack of competition means there was no opportunity for price discovery through bidding, potentially leading to higher costs for the government and taxpayers. It also limits the government's ability to leverage market competition to secure the best possible terms and pricing.

Taxpayer Impact: Sole-source awards mean taxpayers do not benefit from the cost savings typically achieved through competitive bidding. This can result in higher overall expenditure for the services rendered.

Public Impact

The Department of the Army benefits from specialized professional, scientific, and technical services essential for its operations. The contract supports a wide range of potential services under the broad 'All Other Professional, Scientific, and Technical Services' category. The geographic impact is likely concentrated around Department of the Army installations or operational areas. The contract supports a workforce of professionals in scientific, technical, and other specialized fields.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost-plus award fee structure can incentivize increased spending.
Broad service category makes performance monitoring and value assessment more complex.
Long contract duration could indicate a lack of market alternatives or strategic sourcing issues.

Positive Signals

Contractor has a long-standing relationship with the government, suggesting familiarity and potentially efficient service delivery.
The contract addresses a specific need within the Department of the Army, indicating alignment with agency objectives.

Sector Analysis

This contract falls under the professional, scientific, and technical services sector, a broad category encompassing a wide array of specialized expertise. The market for these services is highly diverse, ranging from engineering and research to management consulting and environmental services. Government spending in this sector is substantial, driven by the need for specialized support across various agencies. Benchmarking is challenging due to the heterogeneity of services, but contracts of this magnitude often represent significant investments in critical capabilities.

Small Business Impact

The contract data indicates that this was not a small business set-aside, and there is no explicit information regarding subcontracting plans for small businesses. This suggests that opportunities for small businesses to participate in this specific contract may have been limited. Without a dedicated small business focus, the potential economic benefits for the small business ecosystem are reduced, and the government may not be fully leveraging the capabilities of smaller, specialized firms.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures would be defined within the contract's terms and conditions, particularly concerning performance standards and award fees. Transparency is often limited for sole-source contracts, especially regarding the justification for the non-competitive award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Professional Services Contracts
Army Technical Support Services
Government-wide Professional Services Schedules (if applicable)
Cost-Plus Award Fee Contracts

Risk Flags

Lack of Competition
Cost-Plus Contract Type
Broad Service Category (NAICS 541990)
Long Contract Duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.4 million to PARSONS GOVERNMENT SERVICES INTERNATIONAL INC.. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is PARSONS GOVERNMENT SERVICES INTERNATIONAL INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $13.4 million.

What is the period of performance?

Start: 2005-09-16. End: 2011-11-30.

What specific services were provided under this contract?

The contract falls under NAICS code 541990, 'All Other Professional, Scientific, and Technical Services.' This is a very broad category, and without further details from the contract award documents or agency justifications, it is difficult to pinpoint the exact services rendered. Such contracts can encompass a wide range of activities, including but not limited to research and development support, specialized engineering services, scientific analysis, technical consulting, and program management support. The 'All Other' designation implies that the services did not fit neatly into more specific professional service categories.

What was the justification for awarding this contract on a sole-source basis?

Sole-source awards are typically justified under specific circumstances outlined in federal acquisition regulations, such as the existence of only one responsible source, urgent and compelling needs, or specific national security requirements. For this contract, the justification for not competing it would have been documented by the Department of the Army at the time of award. Common reasons include unique capabilities possessed by the contractor, a critical need for continuity of services provided by the incumbent, or situations where competition is deemed not feasible or not in the government's best interest. Without access to the specific Justification for Other Than Full and Open Competition (JOFOC) document, the precise rationale remains unknown.

How does the cost-plus award fee structure typically impact contract costs compared to fixed-price contracts?

Cost-plus award fee (CPAF) contracts reimburse the contractor for allowable costs incurred, plus a fee that is composed of a base fee and an award amount. The award amount is determined based on the contractor's performance against pre-defined criteria. While CPAF contracts offer flexibility and can be useful for complex projects where scope is uncertain, they generally carry a higher risk of cost escalation than fixed-price contracts. The government bears more of the financial risk, as costs are reimbursed. The award fee component aims to incentivize performance, but the overall cost can be less predictable and potentially higher than under a fixed-price arrangement where the contractor assumes more risk.

What is the typical performance period for contracts of this nature and value?

This contract had a duration of 2,266 days, which is approximately 6.2 years, including all option periods. This is a relatively long performance period for a single contract, especially for professional services. Long durations are often seen in contracts that provide essential, ongoing support critical to an agency's mission, or where there are significant barriers to switching contractors, such as specialized knowledge or integration with existing systems. Such extended periods can be beneficial for contractor stability and knowledge retention but also necessitate robust oversight to ensure continued value and prevent complacency.

What are the potential risks associated with a broad 'All Other Professional, Scientific, and Technical Services' contract?

The primary risk associated with a broad service category like 'All Other Professional, Scientific, and Technical Services' (NAICS 541990) is a lack of specificity, which can lead to challenges in performance monitoring, scope creep, and value assessment. It can be difficult for the government to precisely define requirements and measure contractor performance when the scope is so wide. This ambiguity can also make it harder to compare the contract's pricing and effectiveness against benchmarks. Furthermore, the broadness might obscure whether the services could have been procured more efficiently through more specialized contract vehicles or competitions.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: MEDICAL SERVICES › MEDICAL, DENTAL, AND SURGICAL SVCS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: Parsons Corporation (UEI: 030866545)

Address: 100 W WALNUT ST, PASADENA, CA, 28

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline