EPA awards $43.8M contract for computer systems design services to Lockheed Martin Services, LLC

Contract Overview

Contract Amount: $43,851,062 ($43.9M)

Contractor: Lockheed Martin Services, LLC

Awarding Agency: Environmental Protection Agency

Start Date: 2003-09-15

End Date: 2008-09-30

Contract Duration: 1,842 days

Daily Burn Rate: $23.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 11

Pricing Type: COST NO FEE

Sector: IT

Place of Performance

Location: CHERRY HILL, CAMDEN County, NEW JERSEY, 08002

State: New Jersey Government Spending

Plain-Language Summary

Environmental Protection Agency obligated $43.9 million to LOCKHEED MARTIN SERVICES, LLC for work described as: Key points: 1. Contract value of $43.8 million over approximately 5 years suggests a significant investment in IT infrastructure. 2. The 'Computer Systems Design Services' category indicates a focus on IT support and development. 3. A full and open competition with 11 bidders suggests a competitive environment for this type of service. 4. The contract was awarded by the Environmental Protection Agency (EPA), aligning with its mission. 5. The duration of the contract (1842 days) points to a long-term need for these services. 6. The contract type 'COST NO FEE' implies that the contractor is reimbursed for allowable costs, with no additional profit margin. 7. The award to Lockheed Martin Services, LLC, a large defense contractor, indicates a potential for complex IT solutions.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or comparable IT service contracts from the EPA. The 'COST NO FEE' structure can sometimes lead to cost overruns if not carefully managed, but it also aims to ensure the contractor is only reimbursed for actual expenses. The total award amount of $43.8 million over nearly five years averages to approximately $8.77 million annually, which for comprehensive IT systems design services, appears within a reasonable range for a federal agency of the EPA's size and scope.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with 11 bids received. This indicates a robust bidding process where multiple vendors had the opportunity to compete for the work. A higher number of bidders generally suggests a healthy market for the services and can lead to more competitive pricing and better solutions for the government.

Taxpayer Impact: The extensive competition for this contract is beneficial for taxpayers as it likely drove down costs and ensured the EPA received a competitive offer for essential IT services.

Public Impact

The primary beneficiaries are likely EPA employees and contractors who will utilize the improved computer systems and design services. The services delivered are expected to enhance the EPA's IT infrastructure, supporting its environmental protection mission. The geographic impact is likely nationwide, as EPA operations are distributed across the United States. Workforce implications could include the need for specialized IT personnel within the EPA to manage and integrate the new systems, as well as potential employment opportunities with the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'COST NO FEE' contract type requires diligent oversight to prevent potential cost escalations and ensure that only allowable costs are reimbursed.
Reliance on a single large contractor for critical IT systems design could pose a risk if the contractor faces performance issues or financial instability.
The long duration of the contract necessitates ongoing performance monitoring to ensure continued alignment with evolving EPA needs and technological advancements.

Positive Signals

The award resulted from a full and open competition with 11 bidders, indicating a competitive process that likely yielded a strong value proposition.
The contract is with Lockheed Martin Services, LLC, a well-established company with significant experience in government contracting, suggesting a degree of reliability.
The contract's focus on computer systems design services addresses a core IT need for the agency, supporting its operational efficiency.

Sector Analysis

The Information Technology (IT) sector, particularly within government contracting, is characterized by rapid technological advancements and a constant demand for sophisticated systems design and support. Federal agencies like the EPA rely heavily on IT to manage vast amounts of data, conduct research, and implement regulatory programs. This contract fits within the broader IT services market, which includes areas like software development, systems integration, and IT consulting. Comparable spending benchmarks for IT services within federal agencies can vary widely based on agency size and specific needs, but contracts in the tens of millions of dollars for comprehensive IT support are common.

Small Business Impact

This contract was awarded under full and open competition and does not indicate any specific small business set-aside provisions. Therefore, the direct impact on small businesses is likely limited unless Lockheed Martin Services, LLC engages in significant subcontracting with small businesses. The absence of a set-aside suggests that the primary award was made to a large business based on the competitive evaluation of all offers.

Oversight & Accountability

Oversight for this contract would primarily fall under the Environmental Protection Agency's contracting officers and program managers. Given the 'COST NO FEE' structure, rigorous financial oversight and auditing would be crucial to ensure that all reimbursed costs are allowable and reasonable. Transparency would be facilitated through standard federal procurement reporting mechanisms. The Inspector General's office for the EPA would likely have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

EPA IT Modernization Projects
Federal IT Services Contracts
Computer Systems Design and Related Services
Information Technology Support Services

Risk Flags

Cost Reimbursement Oversight
Long-Term IT Dependency
Contractor Performance Monitoring

Frequently Asked Questions

What is this federal contract paying for?

Environmental Protection Agency awarded $43.9 million to LOCKHEED MARTIN SERVICES, LLC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is LOCKHEED MARTIN SERVICES, LLC.

Which agency awarded this contract?

Awarding agency: Environmental Protection Agency (Environmental Protection Agency).

What is the total obligated amount?

The obligated amount is $43.9 million.

What is the period of performance?

Start: 2003-09-15. End: 2008-09-30.

What is the track record of Lockheed Martin Services, LLC with the EPA on similar IT contracts?

Assessing Lockheed Martin Services, LLC's specific track record with the EPA on similar IT contracts requires a deep dive into historical contract data. Generally, Lockheed Martin is a large, established defense and technology contractor with extensive experience across various U.S. government agencies, including civilian ones like the EPA. Their portfolio often includes complex IT solutions, systems integration, and support services. However, the performance on any given contract can vary. For this specific contract, the 'COST NO FEE' structure suggests a focus on cost reimbursement rather than fixed-price deliverables, which can influence performance dynamics. A review of past performance evaluations, if publicly available, would provide more granular insights into their reliability, quality of service, and adherence to schedules and budgets on prior EPA engagements.

How does the $43.8 million award compare to other EPA IT contracts of similar scope?

The $43.8 million award for computer systems design services over approximately five years represents a substantial investment by the EPA. To benchmark this value, one would need to compare it against other EPA contracts for similar IT services, considering factors like the specific technologies involved, the complexity of the systems designed, and the duration of the contract. Federal procurement data often shows a wide range for IT contracts, with significant projects easily reaching tens or hundreds of millions of dollars. The average annual value of this contract is roughly $8.77 million. This figure should be evaluated against the agency's overall IT budget and the criticality of the systems being developed or maintained. Without specific details on the scope of 'computer systems design services,' a precise comparison is difficult, but the amount is consistent with significant IT modernization or support efforts within large federal agencies.

What are the primary risks associated with a 'COST NO FEE' contract structure for IT services?

The 'COST NO FEE' (CNF) contract structure, while less common than fixed-price or cost-plus-incentive-fee arrangements, primarily aims to reimburse the contractor for allowable costs incurred without an additional profit margin. The main risk for the government is the potential for cost escalation if the contractor's cost accounting and management are not rigorous. Unlike fixed-price contracts where the contractor bears cost overruns, in a CNF contract, the government is obligated to pay all reasonable and allowable costs. This necessitates robust oversight from the contracting agency to scrutinize expenses, ensure efficiency, and prevent unnecessary spending. For the contractor, the risk lies in not being able to recover all incurred costs if they are deemed unallowable or unreasonable by the government. This structure can sometimes disincentivize efficiency if not carefully monitored.

How does the number of bidders (11) influence the potential effectiveness and cost of this contract?

Having 11 bidders for this contract, awarded under full and open competition, is a strong positive indicator for both effectiveness and cost. A larger pool of bidders generally signifies a competitive marketplace where multiple companies possess the capabilities to fulfill the requirement. This competition typically drives down prices as contractors vie for the award. Furthermore, it increases the likelihood that the EPA will select a contractor offering the best combination of technical solution, past performance, and price. The diversity of approaches proposed by 11 different firms could also lead to more innovative solutions. For taxpayers, this level of competition is advantageous as it helps ensure that the government is not overpaying for the services and is receiving a high-quality outcome.

What are the implications of awarding an IT services contract to a company primarily known for defense contracting?

Awarding an IT services contract to a company like Lockheed Martin, which has a significant presence in defense contracting, is not unusual in the federal IT landscape. Large, diversified companies often have robust IT divisions capable of handling complex projects across various sectors. The implications can be mixed. On the positive side, such contractors often bring extensive experience in managing large-scale, complex projects, sophisticated project management methodologies, and a strong understanding of security protocols, which are crucial for government IT. On the other hand, their overhead structures might be higher, and their primary focus may historically have been defense-related, potentially requiring a cultural or operational shift to effectively serve civilian agencies like the EPA. However, their established infrastructure and resources can also be an advantage for delivering comprehensive IT solutions.

What is the historical spending pattern for 'Computer Systems Design Services' at the EPA?

Analyzing historical spending patterns for 'Computer Systems Design Services' at the EPA would require access to detailed federal procurement databases. Generally, agencies like the EPA have consistent needs for IT support, including systems design, development, and maintenance, to manage environmental data, regulatory compliance, and internal operations. Spending in this category can fluctuate based on major IT modernization initiatives, system upgrades, or the lifecycle of existing systems. The $43.8 million awarded here over five years suggests a significant, ongoing requirement. Comparing this award to previous years' spending on similar services would reveal trends, such as whether the EPA is increasing or decreasing its investment in this area, or if spending is relatively stable, indicating a continuous need for these capabilities.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 11

Pricing Type: COST NO FEE (S)

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 2339 ROUTE 70 W, CHERRY HILL, NJ, 01

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $42,778,339

Exercised Options: $42,778,339

Current Obligation: $43,851,062

Parent Contract

Parent Award PIID: 26301D0054

IDV Type: IDC

Timeline