DoD awards $112M engineering services task order to Torch Technologies Inc. under full and open competition

Contract Overview

Contract Amount: $112,339,949 ($112.3M)

Contractor: Torch Technologies Inc

Awarding Agency: Department of Defense

Start Date: 2012-09-19

End Date: 2017-05-01

Contract Duration: 1,685 days

Daily Burn Rate: $66.7K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: TIME AND MATERIALS

Sector: Defense

Official Description: TASK ORDER FOR PROFESSIONAL ENGINEERING SERVICES

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35898

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $112.3 million to TORCH TECHNOLOGIES INC for work described as: TASK ORDER FOR PROFESSIONAL ENGINEERING SERVICES Key points: 1. Contract value represents a significant investment in specialized engineering support for the Department of Defense. 2. Full and open competition suggests a robust bidding process, potentially leading to competitive pricing. 3. The contract duration of over 4 years indicates a long-term need for these engineering services. 4. Performance is located in Alabama, suggesting a regional economic impact. 5. The task order was awarded under a broader contract vehicle, implying a pre-vetted selection process. 6. The use of Time and Materials pricing requires careful monitoring to ensure cost efficiency.

Value Assessment

Rating: good

The contract value of $112.3 million over approximately 4.7 years (1685 days) for engineering services appears reasonable given the scope. Benchmarking against similar large-scale engineering support contracts within the DoD is challenging without more specific service details. However, the duration and the nature of 'professional engineering services' suggest a substantial requirement. The Time and Materials (T&M) pricing structure necessitates diligent oversight to prevent cost overruns and ensure value for money, as it can be less predictable than fixed-price contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. This suggests a competitive environment where multiple companies likely vied for the opportunity. The specific number of bidders is not provided, but the designation implies a broad solicitation process, which is generally favorable for price discovery and achieving market-based rates.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it maximizes the pool of potential offerors, fostering competition that can drive down prices and improve the quality of services received.

Public Impact

The Department of Defense benefits from specialized professional engineering services crucial for its operations and technological advancements. The contract supports the development, analysis, and sustainment of defense systems and infrastructure. The geographic impact is concentrated in Alabama, where the contractor is located and services are likely performed. The contract supports skilled engineering jobs within the aerospace and defense sector in Alabama.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials (T&M) contract type can lead to cost uncertainty if not closely managed, potentially exceeding initial estimates.
Lack of specific performance metrics or deliverables in the provided data makes it difficult to assess the efficiency and effectiveness of the engineering services.
The broad nature of 'professional engineering services' could encompass a wide range of activities, making it hard to pinpoint specific areas of potential cost escalation without further detail.

Positive Signals

Awarded under full and open competition, suggesting a competitive bidding process that likely resulted in a fair market price.
The contractor, Torch Technologies Inc., has secured a significant contract, indicating a level of trust and capability recognized by the DoD.
The long duration of the contract (over 4 years) suggests a stable, ongoing need for these critical engineering services, providing continuity.
The contract is for professional engineering services, which are essential for maintaining and advancing complex defense systems.

Sector Analysis

The engineering services sector within the federal government is substantial, supporting a wide array of agencies, particularly the Department of Defense. This contract falls under the North American Industry Classification System (NAICS) code 541330 (Engineering Services). Spending in this category is driven by the need for specialized technical expertise in areas such as systems design, analysis, testing, and integration for complex projects. The market includes numerous firms, ranging from large defense contractors to specialized engineering consultancies. This specific award to Torch Technologies Inc. represents a portion of the broader federal investment in defense-related engineering capabilities.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Torch Technologies Inc. is likely a mid-to-large-sized business. While there's no direct small business set-aside, the prime contractor may engage small businesses as subcontractors to fulfill specific aspects of the engineering services required. The extent of small business subcontracting is not detailed here, but it is a common practice in larger federal contracts to meet small business utilization goals.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) within the Department of the Army. The Time and Materials (T&M) nature of the contract necessitates robust oversight to track labor hours, material costs, and ensure that work performed aligns with the contract's objectives and is performed efficiently. Transparency is generally maintained through contract reporting requirements and potential audits by agencies like the Defense Contract Audit Agency (DCAA) or the Inspector General (IG) if specific concerns arise.

Related Government Programs

Department of Defense Research and Development Contracts
Defense Engineering Support Services
Army Professional Services Contracts
Aerospace Engineering Services
Systems Engineering and Technical Assistance (SETA) Contracts

Risk Flags

Potential for cost overruns due to Time and Materials pricing structure.
Lack of specific performance metrics in provided data hinders effectiveness assessment.
Scope creep risk inherent in broad 'professional engineering services' definition.
Contract duration requires sustained oversight to ensure continued value.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $112.3 million to TORCH TECHNOLOGIES INC. TASK ORDER FOR PROFESSIONAL ENGINEERING SERVICES

Who is the contractor on this award?

The obligated recipient is TORCH TECHNOLOGIES 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 $112.3 million.

What is the period of performance?

Start: 2012-09-19. End: 2017-05-01.

What is the track record of Torch Technologies Inc. in performing similar engineering services contracts for the DoD?

Torch Technologies Inc. has a history of securing contracts with the Department of Defense, often in specialized engineering and technical support roles. While the specific details of past performance on contracts of this exact magnitude and scope are not provided here, their ability to win this $112 million task order suggests a demonstrated capability and a positive past performance record recognized by the Army. Further investigation into their contract history, including any performance reviews or past issues, would be necessary for a comprehensive assessment. However, winning a large, competitively awarded contract typically implies a baseline level of competence and reliability.

How does the awarded amount compare to typical spending on similar engineering services by the Department of the Army?

The awarded amount of $112.3 million for professional engineering services is substantial, reflecting a significant investment. The Department of the Army procures a wide range of engineering services, from basic design to complex systems integration and sustainment. Without specific details on the exact nature of the 'professional engineering services' rendered under this task order, direct comparison is difficult. However, large-scale engineering support contracts for major defense programs can easily reach tens or hundreds of millions of dollars over their lifecycle. This award appears to be within the expected range for significant, long-term engineering support requirements within a major military branch like the Army.

What are the primary risks associated with a Time and Materials (T&M) contract of this size and duration?

The primary risk with a Time and Materials (T&M) contract, especially one valued at $112 million over nearly five years, is cost escalation. Unlike fixed-price contracts, T&M contracts pay the contractor for the actual labor hours and material costs incurred. This structure can incentivize longer project durations or less efficient work if not rigorously monitored. Key risks include: uncontrolled labor hours, inflated material costs, scope creep without adequate change order management, and potential for the contractor to prioritize billable hours over efficient task completion. Effective oversight, clear task definitions, and strong performance management are crucial to mitigate these risks and ensure value for taxpayer money.

How does the 'full and open competition' award mechanism impact the value proposition for the government?

Awarding a contract under 'full and open competition' generally enhances the value proposition for the government. This mechanism maximizes the number of potential bidders by allowing all responsible sources to participate, thereby increasing the likelihood of receiving competitive proposals. Increased competition typically drives down prices, encourages innovation, and leads to higher quality services as contractors vie for the award. For taxpayers, this means a greater chance that the government is obtaining services at a fair market price and that the chosen contractor offers the best overall value, balancing cost, technical merit, and past performance.

What is the historical spending trend for engineering services (NAICS 541330) by the Department of Defense?

The Department of Defense (DoD) is consistently one of the largest federal purchasers of engineering services, as defined by NAICS code 541330. Historical spending data shows a significant and often increasing trend in this category, driven by modernization efforts, sustainment of existing platforms, and research and development activities. Annual spending by the DoD on engineering services typically runs into the tens of billions of dollars across all its branches and agencies. Factors influencing this spending include geopolitical conditions, technological advancements, and the lifecycle stage of various defense programs. This $112 million task order represents a fraction of the DoD's overall annual expenditure in this critical sector.

Are there specific performance metrics or deliverables associated with this task order that can be used to gauge success?

The provided data does not include specific performance metrics or deliverables for this task order. Task orders issued under larger indefinite-delivery/indefinite-quantity (IDIQ) contracts often reference the performance work statement (PWS) or statement of work (SOW) of the parent contract, or may have their own specific PWS/SOW attached. Without access to these documents, it is impossible to determine the specific success criteria. For a Time and Materials contract, success is often measured by adherence to budget, timely completion of defined tasks, and the quality of the engineering solutions provided, all of which would be detailed in the PWS/SOW and monitored by the COR.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 4035 CHRIS DR SW STE C, HUNTSVILLE, AL, 35802

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business

Financial Breakdown

Contract Ceiling: $210,672,811

Exercised Options: $112,339,949

Current Obligation: $112,339,949

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W31P4Q08A0019

IDV Type: IDC

Timeline