DoD's $31.4M Engineering Services Contract Awarded to MAG DS Corp via Full and Open Competition

Contract Overview

Contract Amount: $31,411,926 ($31.4M)

Contractor: MAG DS Corp

Awarding Agency: Department of Defense

Start Date: 2014-04-24

End Date: 2018-10-23

Contract Duration: 1,643 days

Daily Burn Rate: $19.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF RAPID RESPONSE (R2) TASK ORDER 0009 IS AWARDED ON A COST-PLUS-FIXED-FEE (CPFF), SUPPORT SERVICES.

Place of Performance

Location: ABERDEEN PROVING GROUND, HARFORD County, MARYLAND, 21005

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $31.4 million to MAG DS CORP for work described as: IGF::OT::IGF RAPID RESPONSE (R2) TASK ORDER 0009 IS AWARDED ON A COST-PLUS-FIXED-FEE (CPFF), SUPPORT SERVICES. Key points: 1. Contract awarded on a Cost-Plus-Fixed-Fee basis, indicating potential for cost overruns if not managed closely. 2. Full and open competition suggests a robust bidding process, likely leading to competitive pricing. 3. The contract duration of 1643 days (approx. 4.5 years) indicates a significant, long-term need for engineering services. 4. Awarded by the Department of the Army, this contract falls under a critical defense sector. 5. The North American Industry Classification System (NAICS) code 541330 points to specialized engineering services. 6. The contract was awarded as a Delivery Order, suggesting it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without more detailed service descriptions and comparable contract data. However, the Cost-Plus-Fixed-Fee (CPFF) structure means the government pays actual costs plus a fixed fee, which can sometimes lead to higher overall costs compared to fixed-price contracts if cost controls are not stringent. The total award amount of $31.4 million over approximately 4.5 years suggests a substantial investment in engineering services.

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 a bid. The presence of 2 bids suggests a moderate level of competition for this specific delivery order. While full and open competition is generally preferred for maximizing price discovery and ensuring fair access to government contracts, the limited number of bidders for this particular order warrants attention to ensure the competition was truly robust.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and improve service quality. The fact that this contract was competed openly suggests that the government sought the best value available in the market.

Public Impact

The primary beneficiaries are likely components within the Department of the Army requiring specialized engineering support. The services delivered are categorized under Engineering Services, crucial for defense infrastructure and operations. The geographic impact is likely concentrated within areas where the Department of the Army operates or has facilities. This contract supports a workforce skilled in various engineering disciplines, contributing to the defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

CPFF contract type can lead to cost overruns if not closely monitored.
Limited number of bidders (2) for a full and open competition may indicate specific market constraints or high barriers to entry.
The long duration of the contract could pose risks if requirements change significantly over time.

Positive Signals

Awarded through full and open competition, suggesting a fair and transparent procurement process.
The contract is for essential engineering services supporting national defense.
The fixed-fee component of the CPFF contract provides some level of cost predictability for the fee portion.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the broader professional, scientific, and technical services industry. This sector is characterized by specialized expertise and often supports large government procurements, particularly in defense, infrastructure, and research and development. The market size for engineering services is substantial, with government contracts forming a significant portion. This specific award aligns with typical defense spending patterns for specialized technical support.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. However, the prime contractor, MAG DS Corp, may engage small businesses as subcontractors, which would be detailed in their subcontracting plan, if applicable.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program management office within the Department of the Army. Accountability measures are inherent in the CPFF structure, requiring detailed cost reporting and justification. Transparency is facilitated through contract award databases, though specific performance details may be sensitive. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Defense Engineering Services
Army Support Contracts
Cost-Plus-Fixed-Fee Contracts
Professional, Scientific, and Technical Services

Risk Flags

Cost Overrun Potential (CPFF)
Limited Competition (2 Bidders)
Long Contract Duration Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $31.4 million to MAG DS CORP. IGF::OT::IGF RAPID RESPONSE (R2) TASK ORDER 0009 IS AWARDED ON A COST-PLUS-FIXED-FEE (CPFF), SUPPORT SERVICES.

Who is the contractor on this award?

The obligated recipient is MAG DS CORP.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $31.4 million.

What is the period of performance?

Start: 2014-04-24. End: 2018-10-23.

What is the track record of MAG DS Corp in performing similar engineering services contracts for the Department of Defense?

Assessing MAG DS Corp's track record requires a deeper dive into their contract history beyond this single award. Information on past performance, including successful completion of similar engineering services, adherence to schedules and budgets, and client satisfaction, would be crucial. Government contract databases and past performance reviews (if publicly available) can provide insights. A review of their portfolio would indicate if they have a history of managing complex, large-scale engineering projects, particularly within the defense sector, and whether they have a pattern of cost overruns or successful cost management on CPFF contracts.

How does the Cost-Plus-Fixed-Fee (CPFF) structure compare to other contract types for similar engineering services, and what are the implications for value?

The CPFF structure is often used when the scope of work is not precisely defined, or when there is significant uncertainty in the cost of performance, such as in research and development or complex engineering projects. It allows the contractor to recover all allowable costs plus a predetermined fixed fee representing profit. Compared to fixed-price contracts, CPFF offers flexibility but can lead to higher costs for the government if cost controls are weak, as the contractor is incentivized to incur costs to increase the fee base (though the fee itself is fixed). For value, it depends heavily on the government's ability to effectively monitor costs and ensure the contractor is performing efficiently. Fixed-price contracts, conversely, place more cost risk on the contractor but can offer better price certainty if the scope is well-defined.

What specific engineering services were procured under this contract, and how do they align with the Army's strategic objectives?

The provided data only specifies 'Engineering Services' under NAICS code 541330. To understand the alignment with Army strategic objectives, a detailed review of the Statement of Work (SOW) or Performance Work Statement (PWS) for this delivery order is necessary. These documents would outline the specific tasks, deliverables, and technical requirements. For example, the services could range from design and analysis of military equipment, infrastructure development, systems engineering for new technologies, or technical support for existing platforms. Understanding these specifics would reveal how they contribute to modernization, readiness, or other key Army priorities.

Given the $31.4M award value and 1643-day duration, what is the approximate average annual spending rate, and how does this compare to historical Army spending on similar engineering services?

The total award value is $31,411,925.79 over 1643 days. To calculate the average annual spending rate, we can divide the total value by the duration in years (1643 days / 365.25 days/year ≈ 4.5 years). This yields an approximate annual spending rate of $31,411,925.79 / 4.5 years ≈ $6.98 million per year. Comparing this to historical Army spending requires access to aggregated data on engineering services contracts. Benchmarking this rate against similar-sized projects or programs within the Army's budget for engineering support would provide context on whether this represents a typical or outlier investment.

What are the potential risks associated with a CPFF contract awarded via full and open competition with only two bidders?

A CPFF contract inherently carries risks related to cost control and potential for scope creep, as the government bears the cost risk. When combined with full and open competition that yields only two bidders, the risk profile can be amplified. While full and open competition aims for broad participation, a low number of bidders might suggest that the technical requirements are highly specialized, the contract value is not sufficiently attractive to a wider market, or there are significant barriers to entry (e.g., security clearances, specific certifications). This limited competition could potentially reduce the government's leverage in negotiating favorable terms or ensuring the most competitive pricing, even within the CPFF structure. It warrants closer scrutiny of the solicitation process and the evaluation criteria to ensure the selected contractor truly offers the best value.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1 RADAR WAY, TINTON FALLS, NJ, 07724

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $43,613,332

Exercised Options: $32,089,496

Current Obligation: $31,411,926

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W15P7T10DD421

IDV Type: IDC

Timeline