DoD's $139M courseware development contract with CAE USA Inc. awarded in 2007, ending 2014

Contract Overview

Contract Amount: $139,160,992 ($139.2M)

Contractor: CAE USA Inc.

Awarding Agency: Department of Defense

Start Date: 2007-08-31

End Date: 2014-12-31

Contract Duration: 2,679 days

Daily Burn Rate: $51.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: COURSEWARE DEVELOPMENT

Place of Performance

Location: ARLINGTON, TARRANT County, TEXAS, 76011

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $139.2 million to CAE USA INC. for work described as: COURSEWARE DEVELOPMENT Key points: 1. Value for money appears fair given the long duration and cost-plus structure, though specific performance metrics are not detailed. 2. Competition dynamics were full and open, suggesting a competitive bidding process that should have driven reasonable pricing. 3. Risk indicators include the cost-plus contract type, which can incentivize higher spending, and the extended performance period. 4. Performance context is limited without specific deliverables or success metrics, but the contract spanned over 7 years. 5. Sector positioning is within defense training and simulation, a critical area for military readiness.

Value Assessment

Rating: fair

The contract's total value of $139 million over approximately 7 years suggests an average annual spend of around $20 million. Without detailed performance data or comparison to similar courseware development contracts, a precise value-for-money assessment is challenging. The cost-plus fixed fee structure means the government pays costs plus a negotiated fee, which can lead to higher overall costs compared to fixed-price contracts if not managed tightly. Benchmarking against industry standards for similar training development would be necessary for a more definitive 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. This suggests a robust bidding environment, which typically leads to better price discovery and potentially more favorable terms for the government. The number of bidders is not specified, but the 'full and open' designation implies multiple interested parties participated.

Taxpayer Impact: A full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation from multiple vendors.

Public Impact

Military personnel across various branches likely benefited from updated and standardized courseware for training. The services delivered involved the development and potentially maintenance of digital training materials and simulation content. The geographic impact is likely widespread, supporting training needs for a globally deployed military force. Workforce implications could include specialized instructional designers, subject matter experts, and technical developers within CAE USA Inc. and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus contract type can lead to cost overruns if not closely monitored.
Long contract duration (7 years) increases the risk of scope creep and evolving technological needs not being met.
Lack of specific performance metrics makes it difficult to assess the effectiveness and efficiency of the courseware developed.

Positive Signals

Awarded through full and open competition, suggesting a competitive process.
Development of critical training materials for the Department of Defense.
Contractor has a long-standing presence in defense simulation and training.

Sector Analysis

This contract falls within the defense training and simulation sector, a significant market driven by the need for advanced and adaptable military education. The market includes providers of learning management systems, simulation software, and content development. Spending in this area is crucial for maintaining military readiness and adapting to new operational environments. Comparable spending benchmarks would involve looking at other large-scale training development contracts within the DoD or other defense agencies.

Small Business Impact

The provided data indicates that small business participation (sb) was false, and there was no specific small business set-aside (ss). This suggests the contract was not specifically targeted towards small businesses, and large prime contractors likely dominated the execution. Subcontracting opportunities for small businesses are not detailed but would depend on CAE USA Inc.'s procurement practices.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Contract Management Agency (DCMA), responsible for ensuring contractor performance and compliance. Accountability measures would be tied to the contract's terms, milestones, and deliverables. Transparency is generally facilitated through contract award databases, though detailed performance reports may be less accessible to the public.

Related Government Programs

Defense Training Systems
Military Simulation Software
Educational Content Development
Department of Defense Acquisition Programs

Risk Flags

Cost-plus contract type may lead to higher costs.
Long performance period increases risk of scope creep.
Lack of detailed performance metrics hinders value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $139.2 million to CAE USA INC.. COURSEWARE DEVELOPMENT

Who is the contractor on this award?

The obligated recipient is CAE USA 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 $139.2 million.

What is the period of performance?

Start: 2007-08-31. End: 2014-12-31.

What was the specific nature of the courseware developed under this contract?

The contract, valued at approximately $139 million, was for 'COURSEWARE DEVELOPMENT' for the Department of Defense. While the specific subject matter is not detailed in the provided data, courseware development in a defense context typically involves creating instructional materials, simulations, and training modules for military personnel. This could range from tactical procedures and equipment operation to strategic planning and leadership development. The duration of the contract (over 7 years) suggests a comprehensive and potentially evolving scope of work, possibly encompassing multiple training domains or updates to existing curricula to reflect changing military needs and technologies.

How does the $139 million total obligation compare to similar courseware development contracts within the DoD?

Comparing the $139 million total obligation for this 7-year courseware development contract requires context regarding the scope, complexity, and specific technologies involved. Large-scale defense training and simulation contracts can range significantly. For instance, contracts for developing advanced flight simulators or complex virtual training environments can easily reach hundreds of millions of dollars. Conversely, contracts focused solely on digital content creation for specific systems might be smaller. Without knowing the exact deliverables and the number of systems or personnel the courseware was intended for, a direct comparison is difficult. However, $139 million over seven years ($~20M/year) is a substantial investment, indicative of a significant training requirement within the DoD.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for courseware development?

The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for courseware development revolve around cost control and contractor incentive. In a CPFF structure, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. The main risk for the government is that the contractor has less financial incentive to control costs, as their profit is fixed regardless of the final project cost. This can lead to potential cost overruns if not rigorously managed through detailed oversight, auditing of expenses, and clear definition of allowable costs. For courseware development, this could mean higher expenses related to personnel, software licenses, or development tools than might be incurred under a fixed-price contract.

Given the 'full and open competition' award, what does this imply about the contractor's track record prior to this award?

An award resulting from 'full and open competition' implies that the bidding process was open to all responsible sources, and the selection was based on the best value offered. While this doesn't guarantee a flawless track record, it suggests that CAE USA Inc. was deemed capable of meeting the government's requirements and offered a competitive proposal. Agencies typically evaluate past performance as part of the source selection process. Therefore, CAE USA Inc. likely had a relevant track record in simulation, training, or courseware development that met or exceeded the DoD's criteria for technical capability, management approach, and potentially past performance on similar contracts, allowing them to successfully compete against other potential bidders.

How has spending on defense courseware development evolved since this contract's award in 2007?

Spending on defense courseware development has likely evolved significantly since 2007, driven by technological advancements and changing military doctrines. The rise of immersive technologies like virtual reality (VR) and augmented reality (AR), sophisticated AI-driven adaptive learning platforms, and the increasing demand for cybersecurity training have reshaped the landscape. While traditional digital courseware remains relevant, there's a greater emphasis on interactive, personalized, and performance-based training solutions. Furthermore, the push towards cloud-based learning management systems and mobile learning capabilities has also influenced development approaches and spending priorities. The DoD's overall training budget and specific allocations for courseware development would reflect these shifts, potentially moving towards more agile and technologically advanced solutions than might have been envisioned in 2007.

What is the significance of the contract ending in December 2014, and were there subsequent contracts for similar services?

The contract's end date of December 2014 signifies the completion of the defined period of performance for the courseware development services procured under this specific award. Following its conclusion, the Department of Defense would have reassessed its ongoing courseware needs. It is highly probable that subsequent contracts were awarded for similar or updated services, reflecting the continuous requirement for training materials. These follow-on contracts could have been awarded to CAE USA Inc. or other competitors, potentially incorporating new technologies, different contract structures (e.g., fixed-price if cost issues arose), or addressing evolving training requirements. Tracking subsequent contract awards would provide insight into the long-term strategy for defense courseware development.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Other Commercial and Service Industry Machinery Manufacturing

Product/Service Code: TRAINING AIDS AND DEVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N6133907R0035

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Parent Company: CAE Inc

Address: 2200 ARLINGTON DOWNS RD, ARLINGTON, TX, 76011

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $165,168,743

Exercised Options: $165,168,743

Current Obligation: $139,160,992

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6133903D5017

IDV Type: IDC

Timeline