Commerce Department awards $49M IT contract to Science Applications International Corp. for USPTO systems design

Contract Overview

Contract Amount: $49,084,734 ($49.1M)

Contractor: Science Applications International Corporation

Awarding Agency: Department of Commerce

Start Date: 2021-09-01

End Date: 2026-05-31

Contract Duration: 1,733 days

Daily Burn Rate: $28.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: LABOR HOURS

Sector: IT

Official Description: BUCKET I FRAMEWORK ID#: 1PT.103 & 1PT.102

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Commerce obligated $49.1 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: BUCKET I FRAMEWORK ID#: 1PT.103 & 1PT.102 Key points: 1. Contract value of $49.1 million over approximately 5.7 years suggests a moderate annual spend. 2. Full and open competition indicates a broad market search, potentially leading to competitive pricing. 3. The contract is a delivery order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle. 4. The primary service is computer systems design, a critical function for modern government operations. 5. The contract's duration and value warrant scrutiny for cost-effectiveness and performance over its lifecycle. 6. Virginia is the stated location, potentially indicating a concentration of IT services within that region.

Value Assessment

Rating: good

The contract value of $49.1 million over nearly five years averages to approximately $8.6 million annually. Without specific benchmarks for similar USPTO IT system design contracts, a direct comparison is difficult. However, the labor hours pricing structure (PT: LABOR HOURS) suggests that costs are tied to effort expended, which can be efficient if managed well. The award amount appears reasonable for a contract of this scope and duration, assuming the labor rates are competitive.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, meaning all responsible sources were permitted to submit offers. This approach typically fosters a competitive environment, encouraging multiple bidders to vie for the contract. The number of bidders is not specified, but the 'full and open' designation suggests a robust competition was intended and likely achieved, which is generally positive for price discovery and innovation.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it increases the likelihood of securing the best value through competitive pricing and diverse technical solutions.

Public Impact

The U.S. Patent and Trademark Office (USPTO) is the primary beneficiary, receiving essential IT systems design services. This contract supports the modernization and efficiency of patent and trademark application processing. The geographic impact is primarily within Virginia, where the contractor is located, potentially supporting local IT jobs. The services delivered are crucial for the USPTO's mission of promoting innovation and economic growth.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if labor hours are not closely monitored and managed.
Risk of scope creep if requirements are not clearly defined and controlled throughout the contract period.
Dependence on a single contractor for critical IT systems design could pose continuity risks if not managed proactively.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that should yield good value.
The contractor, Science Applications International Corporation (SAIC), is a large and experienced federal IT provider.
The contract duration allows for sustained support and development of critical USPTO systems.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on computer systems design services. The IT services market for the federal government is substantial, with significant spending allocated to software development, system integration, and IT support. Contracts like this are essential for agencies to maintain and upgrade their technological infrastructure, ensuring operational efficiency and the ability to deliver services. Benchmarking this contract's value against similar IT system design contracts within the federal space would provide further context on its cost-effectiveness.

Small Business Impact

The data indicates this contract was not set aside for small businesses (SS: false, SB: false). As a large contract awarded to a major IT provider, there are implications for subcontracting opportunities. While the primary awardee is a large business, there may be opportunities for small businesses to participate as subcontractors, depending on SAIC's subcontracting plan and the specific needs of the IT systems design work. Further analysis of SAIC's subcontracting performance on similar contracts would be beneficial.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program officials within the Department of Commerce and the U.S. Patent and Trademark Office. Accountability measures are usually embedded in the contract terms, including performance metrics, delivery schedules, and quality standards. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

IT Systems Design Services
Computer Systems Design and Related Services
Federal IT Modernization Programs
U.S. Patent and Trademark Office IT Support

Risk Flags

Potential for cost overruns due to labor hour pricing
Risk of scope creep in delivery order tasking
Technological obsolescence over the contract's long duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $49.1 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. BUCKET I FRAMEWORK ID#: 1PT.103 & 1PT.102

Who is the contractor on this award?

The obligated recipient is SCIENCE APPLICATIONS INTERNATIONAL CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Commerce (U.S. Patent and Trademark Office).

What is the total obligated amount?

The obligated amount is $49.1 million.

What is the period of performance?

Start: 2021-09-01. End: 2026-05-31.

What is the track record of Science Applications International Corporation (SAIC) in delivering similar IT systems design services to federal agencies?

Science Applications International Corporation (SAIC) is a well-established and experienced federal contractor with a significant history of providing IT services, including systems design, integration, and support, across various government agencies. They have held numerous large-scale IT contracts, particularly within the defense and civilian sectors. Their track record generally indicates a capacity to manage complex projects and deliver on technical requirements. However, like any large contractor, specific contract performance can vary. A detailed review of SAIC's past performance on contracts with similar scope, complexity, and agency type (e.g., civilian agencies like the USPTO) would be necessary to fully assess their suitability and reliability for this specific award. This would involve examining past performance evaluations, any documented issues or disputes, and their success in meeting key performance indicators on prior engagements.

How does the annual value of this contract compare to typical IT system design contracts for agencies of the USPTO's size and mission?

The annual value of this contract, approximately $8.6 million ($49.1M / 5.7 years), needs to be benchmarked against comparable IT system design contracts. Federal agencies, especially those with significant intellectual property processing functions like the USPTO, often require substantial IT investments. The USPTO's mission involves managing vast amounts of data and complex workflows, necessitating robust and modern IT systems. While $8.6 million annually might seem substantial, it could be considered moderate or even lean depending on the specific systems being designed, the complexity of the integration, the number of users supported, and the prevailing market rates for skilled IT professionals in the Washington D.C. metropolitan area. Without access to specific USPTO IT budget allocations for system design or comparative data from similar agencies (e.g., other intellectual property offices or large civilian agencies with complex data management needs), it is challenging to definitively state if this represents high or low spending. However, the 'full and open' competition suggests an effort to achieve market-driven pricing.

What are the primary risks associated with a contract structured as a delivery order under an IDIQ vehicle for IT systems design?

Contracts structured as delivery orders under an Indefinite Delivery/Indefinite Quantity (IDIQ) vehicle, like this one appears to be (indicated by 'AW: DELIVERY ORDER'), carry specific risks. A primary risk is the potential for 'scope creep' if the requirements for each delivery order are not meticulously defined and controlled. This can lead to increased costs and extended timelines beyond initial expectations. Another risk is the potential for less competitive pricing on individual delivery orders compared to a standalone, competitively solicited contract, especially if the IDIQ vehicle itself was not competed rigorously or if follow-on orders are placed without sufficient market research. Furthermore, reliance on a single IDIQ vehicle for multiple needs can concentrate risk; if the chosen contractor under the IDIQ experiences performance issues, it can impact multiple projects. Effective management by the government, including clear task orders and vigilant oversight, is crucial to mitigate these risks.

What is the significance of the contract being awarded on a 'Labor Hours' basis?

The 'Labor Hours' (PT: LABOR HOURS) pricing structure means that the government pays the contractor based on the actual hours worked by the contractor's personnel at pre-negotiated hourly rates, plus any agreed-upon indirect costs or fee. This structure is often used when the scope of work is not precisely defined at the outset, or when the level of effort is difficult to estimate accurately. For IT systems design, where requirements can evolve, this provides flexibility. However, it also shifts some risk to the government, as the total cost is directly tied to the amount of labor expended. Effective management requires diligent tracking of hours, ensuring that work is efficient and necessary, and that the labor mix (e.g., senior vs. junior staff) aligns with project needs to control costs.

How does the duration of this contract (over 5 years) impact the assessment of value for money?

A contract duration of over five years (1733 days, approximately 5.7 years) for IT systems design services allows for sustained development, implementation, and potential refinement of critical systems. This extended period can be beneficial for value for money if it enables the contractor to gain deep institutional knowledge, leading to more efficient and effective solutions over time. It also provides stability for the agency in its IT planning. However, a longer duration also increases the risk of technological obsolescence if the systems designed are not adaptable to future advancements. Furthermore, it necessitates robust oversight throughout the period to ensure continued cost-effectiveness and performance alignment with evolving agency needs. The government must actively manage the contract to prevent complacency and ensure that the contractor remains incentivized to deliver optimal value throughout the entire term.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design 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: 1

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 12010 SUNSET HILLS RD FL 4, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $49,084,734

Exercised Options: $49,084,734

Current Obligation: $49,084,734

Subaward Activity

Number of Subawards: 10

Total Subaward Amount: $27,163,364

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 47QTCK18D0001

IDV Type: GWAC

Timeline