DoD's $30M Space and Missile Defense Advisory contract to CAE USA Inc. shows fair value with moderate competition

Contract Overview

Contract Amount: $29,959,591 ($30.0M)

Contractor: CAE USA Inc.

Awarding Agency: Department of Defense

Start Date: 2017-08-29

End Date: 2020-08-28

Contract Duration: 1,095 days

Daily Burn Rate: $27.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF SPACE AND MISSILE DEFENSE ADVISORY AND ASSISTANCE , TASK ORDER DIRECTORATE OF TRAINING AND DOCTRINE (DOTD) SUPPORT

Place of Performance

Location: TAMPA, HILLSBOROUGH County, FLORIDA, 33634

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $30.0 million to CAE USA INC. for work described as: IGF::OT::IGF SPACE AND MISSILE DEFENSE ADVISORY AND ASSISTANCE , TASK ORDER DIRECTORATE OF TRAINING AND DOCTRINE (DOTD) SUPPORT Key points: 1. The contract's value appears reasonable when benchmarked against similar engineering services contracts. 2. Competition was limited, suggesting potential for higher pricing than a fully open market. 3. The fixed-fee structure provides some cost control, but the 'cost plus' element introduces risk. 4. Performance duration of three years allows for sustained support but requires ongoing monitoring. 5. This contract falls within the broader Defense sector, specifically supporting training and doctrine development. 6. The contractor, CAE USA Inc., has a track record in defense contracting, indicating relevant experience.

Value Assessment

Rating: good

The contract's total value of approximately $30 million over three years for advisory and assistance services in space and missile defense appears to be within a reasonable range for specialized engineering support. Benchmarking against similar Department of Defense contracts for engineering services suggests that the pricing structure, while cost-plus, is not excessively high given the technical expertise required. The fixed fee component provides a degree of cost certainty for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while competition was sought, certain sources were excluded. The presence of two bidders suggests a moderately competitive environment. This level of competition is better than a sole-source award but may not achieve the price discovery benefits of a truly open competition with multiple bidders.

Taxpayer Impact: The limited competition may have resulted in a slightly higher price for taxpayers compared to what might have been achieved in a broader, more inclusive bidding process.

Public Impact

The primary beneficiaries are the Department of Defense's Directorate of Training and Doctrine (DOTD), receiving expert advice. Services delivered include advisory and assistance to enhance space and missile defense capabilities. The geographic impact is primarily within Florida, where the contractor is based, supporting federal operations. Workforce implications include specialized engineering and advisory roles, contributing to the defense sector's skilled labor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the 'cost plus' component if not rigorously managed.
Limited competition could lead to less aggressive pricing from the awarded contractor.
Scope creep is a risk in advisory contracts if not clearly defined and monitored.

Positive Signals

The contractor, CAE USA Inc., has established experience in defense contracting.
The fixed-fee element provides some cost control and predictability.
The contract duration allows for sustained support and knowledge transfer.

Sector Analysis

This contract operates within the Defense Engineering Services sector, a critical component of the broader aerospace and defense industry. This sector is characterized by high technical barriers to entry, significant government investment, and a focus on specialized expertise. Spending in this area is driven by national security priorities, including advanced research, development, and acquisition of defense systems. Comparable spending benchmarks would involve other advisory and assistance contracts within DoD for complex systems.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, and there is no explicit information regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor voluntarily engages small business subcontractors. Further investigation into subcontracting reports would be needed to fully assess the impact.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contract management and oversight mechanisms, potentially involving the Defense Contract Management Agency (DCMA). Accountability measures are embedded in the contract's performance requirements and payment terms. Transparency is generally maintained through contract databases, though specific performance details may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Space and Missile Defense Programs
Defense Training and Education
Engineering and Technical Services
Department of Defense Advisory Services

Risk Flags

Cost Plus contract type carries inherent risk of cost overruns.
Limited competition may impact price competitiveness.
Need for ongoing monitoring of performance and costs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.0 million to CAE USA INC.. IGF::OT::IGF SPACE AND MISSILE DEFENSE ADVISORY AND ASSISTANCE , TASK ORDER DIRECTORATE OF TRAINING AND DOCTRINE (DOTD) SUPPORT

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 $30.0 million.

What is the period of performance?

Start: 2017-08-29. End: 2020-08-28.

What is CAE USA Inc.'s track record with the Department of Defense, particularly in advisory and assistance contracts?

CAE USA Inc. has a significant track record with the Department of Defense, often focusing on simulation, training, and complex systems support. Their experience in defense contracting suggests a familiarity with government procurement processes and performance expectations. For advisory and assistance contracts specifically, their past performance would indicate their capability to provide strategic guidance and technical expertise. Reviewing their contract history, including past performance evaluations and any reported issues, would provide a clearer picture of their reliability and effectiveness in similar roles. This particular contract's duration and value suggest a level of trust and established relationship with the DoD.

How does the pricing structure (Cost Plus Fixed Fee) compare to industry standards for similar advisory services?

The Cost Plus Fixed Fee (CPFF) pricing structure is common for complex projects where the exact costs are difficult to predict but a fixed profit margin is desired. For advisory and assistance services in specialized fields like space and missile defense, CPFF can be appropriate. However, it carries inherent risks for the government, as costs can escalate. Benchmarking against similar contracts would involve comparing the 'cost plus' percentage and the fixed fee amount relative to the total contract value. Industry standards suggest that for high-risk, R&D-intensive, or uncertain scope projects, CPFF is utilized. The 'good' value rating suggests that, in this instance, the structure and associated costs were deemed acceptable relative to the market and the service provided.

What are the key performance indicators (KPIs) used to measure the success of this advisory contract?

While specific KPIs are not detailed in the provided data, typical performance indicators for advisory and assistance contracts in defense include the quality and timeliness of delivered reports, recommendations, and analyses. Success is often measured by the extent to which the contractor's advice contributes to improved decision-making, enhanced program effectiveness, or cost savings for the government. For this contract supporting the Directorate of Training and Doctrine (DOTD), KPIs might relate to the clarity and actionable nature of guidance provided on space and missile defense strategies, training program improvements, or doctrine development. Performance evaluations by the government contracting officer are crucial for assessing adherence to these implicit or explicit KPIs.

What is the historical spending trend for similar advisory and assistance contracts within the DoD's space and missile defense domain?

Historical spending on advisory and assistance (A&AS) contracts within the Department of Defense, particularly for specialized domains like space and missile defense, has generally been substantial and often increasing, driven by evolving threats and technological advancements. These contracts are crucial for providing specialized expertise that may not be available in-house. Trends often show a consistent demand for A&AS services to support program management, strategic planning, technical analysis, and policy development. The approximately $10 million annual spend for this specific contract is indicative of the significant resources allocated to maintaining a technological edge and strategic advantage in this critical defense area. Fluctuations in spending can be tied to specific program lifecycles, budget appropriations, and shifts in strategic priorities.

Are there any identified risks or concerns associated with CAE USA Inc.'s performance on this specific contract?

Based on the provided summary data, there are no explicit 'red flags' or high-level risk indicators mentioned regarding CAE USA Inc.'s performance on this specific contract. The contract received a 'good' rating for value and 'limited' competition, suggesting a generally acceptable outcome. However, the 'cost plus' nature of the contract inherently carries a risk of cost escalation if not managed diligently by the government. Potential concerns could arise from the 'limited' competition, which might imply less pressure on the contractor to optimize costs. Without access to detailed performance reports or contract close-out data, a comprehensive risk assessment is challenging, but the available information does not point to significant performance failures.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: W9126013R0003

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 4908 TAMPA WEST BLVD, TAMPA, FL, 33634

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $29,959,591

Exercised Options: $29,959,591

Current Obligation: $29,959,591

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $41,210

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W9126015D0001

IDV Type: IDC

Timeline