DoD's $17.6M Land Warrior support contract awarded to Viatech, Inc. raises value and competition questions

Contract Overview

Contract Amount: $17,558,763 ($17.6M)

Contractor: Viatech, Inc.

Awarding Agency: Department of Defense

Start Date: 2008-05-23

End Date: 2010-08-31

Contract Duration: 830 days

Daily Burn Rate: $21.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: Defense

Official Description: LAND WARRIOR NEXT GENERATION SUPPORT

Place of Performance

Location: EATONTOWN, MONMOUTH County, NEW JERSEY, 07724, UNITED STATES OF AMERICA

State: New Jersey Government Spending

Plain-Language Summary

Department of Defense obligated $17.6 million to VIATECH, INC. for work described as: LAND WARRIOR NEXT GENERATION SUPPORT Key points: 1. Contract value appears high relative to duration and scope, warranting further value-for-money assessment. 2. Limited public information on performance metrics makes it difficult to gauge effectiveness. 3. The contract's 'Full and Open Competition' status is positive, but the number of bidders is not specified. 4. Engineering services sector is competitive, but specific benchmarks for this type of support are needed. 5. Contract awarded under 'Other Direct Costs' (ODC) with Time and Materials pricing may lead to cost overruns. 6. Geographic location of performance in New Jersey is noted.

Value Assessment

Rating: fair

The contract's total value of approximately $17.6 million over a roughly 2.5-year period suggests a significant annual spend. Without detailed performance metrics or a breakdown of services rendered, it's challenging to benchmark the value against similar support contracts for complex defense systems. The Time and Materials pricing structure, while flexible, can sometimes lead to higher costs than fixed-price contracts if not managed rigorously. Further analysis of the specific engineering services provided and their necessity would be required for a more definitive value assessment.

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. However, the number of bids received (3) is relatively low for a full and open competition, which could suggest potential limitations in the market reach or the attractiveness of the contract terms. A low number of bidders can sometimes result in less competitive pricing.

Taxpayer Impact: While full and open competition is generally beneficial for taxpayers, a low number of bidders may mean that the government did not secure the most competitive pricing possible.

Public Impact

The primary beneficiaries are the Department of Defense, specifically units utilizing the Land Warrior system, receiving engineering and support services. Services delivered likely include technical support, system maintenance, and potentially upgrades or modifications for the Land Warrior system. Geographic impact is concentrated in New Jersey, where the contractor is based and services were likely performed. Workforce implications include employment for engineers and technical staff at Viatech, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials (T&M) pricing can lead to unpredictable costs and potential overruns if not closely monitored.
A low number of bidders (3) in a full and open competition might indicate less robust market competition than ideal.
Lack of publicly available performance data makes it difficult to assess the contractor's effectiveness and the contract's success.
The 'Other Direct Costs' (ODC) component of the award needs further scrutiny to understand its nature and necessity.

Positive Signals

Awarded through 'Full and Open Competition,' suggesting an effort to maximize the pool of potential offerors.
The contractor, Viatech, Inc., was selected through a competitive process, implying they met the government's requirements.
The contract duration of over two years allowed for sustained support of the Land Warrior system.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), which is a significant part of the federal procurement landscape, particularly for defense applications. The market for defense engineering services is substantial, with numerous companies offering specialized expertise. Benchmarking this contract's value would require comparing it to similar support contracts for advanced soldier systems, considering factors like system complexity, required expertise, and contract duration. The total federal spending on engineering services is in the tens of billions annually.

Small Business Impact

There is no indication that this contract included small business set-asides, nor is there information suggesting subcontracting opportunities for small businesses. The award to Viatech, Inc., a single entity, does not inherently signal a focus on integrating small businesses into the supply chain for this specific contract. Further investigation into subcontracting plans would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of Defense's contracting and program management offices, potentially involving the Defense Contract Management Agency (DCMA) given the stated 'SA'. Accountability measures would be tied to the contract's performance clauses and deliverables. Transparency is limited by the availability of public data on performance and detailed cost breakdowns. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Land Warrior Program
Soldier Systems Modernization
Defense Engineering Services
Department of Defense IT and Support Contracts

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Limited competition indicated by a low number of bidders.
Lack of publicly available performance data hinders effectiveness assessment.
Need for detailed cost breakdown and service justification.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.6 million to VIATECH, INC.. LAND WARRIOR NEXT GENERATION SUPPORT

Who is the contractor on this award?

The obligated recipient is VIATECH, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $17.6 million.

What is the period of performance?

Start: 2008-05-23. End: 2010-08-31.

What specific engineering services were provided under this contract, and how did they contribute to the Land Warrior system's functionality?

The provided data indicates the contract was for 'LAND WARRIOR NEXT GENERATION SUPPORT' and falls under the 'Engineering Services' NAICS code (541330). Specific services likely included technical analysis, system integration, software support, hardware maintenance, and potentially research and development for future iterations of the Land Warrior system. These services are crucial for ensuring the operational readiness and effectiveness of advanced soldier systems, which integrate various technologies like communications, navigation, and situational awareness tools. Without detailed contract line item numbers (CLINs) or a statement of work (SOW), the precise nature and scope of the engineering tasks remain generalized. However, the 'Next Generation' designation suggests a focus on evolving the system beyond its initial capabilities.

How does the awarded amount of approximately $17.6 million compare to similar contracts for soldier system support?

Benchmarking this $17.6 million contract requires comparing it to similar support and engineering services for advanced soldier systems. Contracts for programs like Nett Warrior, Integrated Visual Augmentation System (IVAS), or other soldier modernization efforts could serve as comparators. Factors such as contract duration (approximately 2.5 years here), the specific technologies involved, the level of engineering expertise required, and the number of systems supported are critical. Given the complexity and evolving nature of soldier systems, $17.6 million over this period might be within a reasonable range, but without detailed performance metrics and scope of work, a definitive value-for-money assessment is difficult. A higher number of bidders in a competitive process would typically drive prices down, making the current award value a point for further scrutiny.

What are the potential risks associated with the Time and Materials (T&M) pricing structure used for this contract?

The Time and Materials (T&M) pricing structure used for this contract presents several potential risks. Primarily, T&M contracts can lead to cost uncertainty and potential overruns because the government pays for the actual labor hours and materials used, plus a fixed fee or percentage. This structure provides less incentive for the contractor to control costs efficiently compared to fixed-price contracts. For the government, effective oversight and management are crucial to ensure that hours are reasonable and necessary, and that material costs are fair. Without stringent monitoring, T&M contracts can become significantly more expensive than initially anticipated, impacting the overall value for taxpayers. The 'Other Direct Costs' (ODC) component also needs careful management under T&M.

What does the low number of bidders (3) in a 'Full and Open Competition' imply for price discovery and taxpayer value?

A 'Full and Open Competition' is designed to attract the widest possible range of qualified bidders to foster robust price discovery and ensure the government receives the best value. When only three bids are received in such a competition, it can suggest several possibilities. The market for this specific type of engineering support might be limited, or the contract's requirements, terms, or anticipated profit margins may not have been attractive enough to draw more competition. A lower number of bidders generally leads to less intense price competition, potentially resulting in higher prices than if five or more firms had competed. This could mean that taxpayers did not benefit from the most aggressive pricing achievable in a more crowded field.

What is Viatech, Inc.'s track record with similar Department of Defense contracts, particularly in soldier systems support?

Information on Viatech, Inc.'s specific track record with similar Department of Defense contracts, especially in soldier systems support, is not detailed in the provided data. To assess their performance and reliability, one would need to examine their contract history, including past performance evaluations, any awards or penalties received, and the types of services they have previously delivered to the DoD. Understanding their experience with complex engineering services for defense programs like Land Warrior is crucial. A review of federal procurement databases (like FPDS or SAM.gov) and past performance information repositories would be necessary to build a comprehensive picture of Viatech's capabilities and history in this domain.

How has federal spending on engineering services for defense programs evolved over the past decade?

Federal spending on engineering services for defense programs has generally been substantial and has seen fluctuations over the past decade, influenced by geopolitical events, technological advancements, and budget priorities. The Department of Defense consistently represents a significant portion of the federal government's expenditure on engineering services, covering areas from R&D and system design to testing, evaluation, and sustainment. While specific figures vary year to year, the trend reflects a continuous need for specialized engineering expertise to maintain and modernize complex military platforms and systems. Factors like the increasing sophistication of threats and the drive for technological superiority ensure sustained demand for these services, often amounting to tens of billions of dollars annually across the federal government, with defense being a primary driver.

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: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: D & S Consultants Inc. (UEI: 792244097)

Address: 615 HOPE RD STE 3A, EATONTOWN, NJ, 07724

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

Financial Breakdown

Contract Ceiling: $17,558,763

Exercised Options: $17,558,763

Current Obligation: $17,558,763

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W15P7T06DE407

IDV Type: IDC

Timeline