GSA awards $487.8M cyber ops contract to Peraton, highlighting engineering services for ARCYBER

Contract Overview

Contract Amount: $487,767,432 ($487.8M)

Contractor: Peraton Technology Services Inc.

Awarding Agency: General Services Administration

Start Date: 2019-02-11

End Date: 2024-02-11

Contract Duration: 1,826 days

Daily Burn Rate: $267.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: IGF::OT::IGF TASK ORDER AWARD FOR ARCYBER CYBERSPACE OPS REQUIREMENT

Place of Performance

Location: FORT GEORGE G MEADE, ANNE ARUNDEL County, MARYLAND, 20755

State: Maryland Government Spending

Plain-Language Summary

General Services Administration obligated $487.8 million to PERATON TECHNOLOGY SERVICES INC. for work described as: IGF::OT::IGF TASK ORDER AWARD FOR ARCYBER CYBERSPACE OPS REQUIREMENT Key points: 1. Contract value of $487.8M over 5 years suggests significant investment in cyber capabilities. 2. Awarded under full and open competition, indicating a broad market search. 3. Cost Plus Award Fee (CPAF) structure allows for performance-based incentives. 4. Task order awarded by GSA's Federal Acquisition Service, a common procurement channel. 5. Contract duration of 1826 days (5 years) points to long-term strategic needs. 6. Engineering services (NAICS 541330) are critical for complex cyberspace operations.

Value Assessment

Rating: good

The contract's value of $487.8M over five years for cyberspace operations is substantial. Benchmarking against similar large-scale engineering and IT support contracts for defense agencies reveals this is within a typical range for complex, long-term requirements. The CPAF pricing structure, while potentially leading to higher costs if performance is exceptional, also incentivizes efficiency and effectiveness, suggesting a focus on value for money rather than just lowest price. Without specific performance metrics or detailed cost breakdowns, a precise value-for-money assessment is challenging, but the competitive award process provides some assurance.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit offers. The data indicates three bidders participated in this competition. A competitive environment with multiple bidders generally fosters price discovery and can lead to more favorable pricing for the government. The fact that three bids were received suggests sufficient market interest and capability for this type of specialized cyber operations support.

Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down costs through market forces and ensuring the government receives offers from a wide range of qualified providers, maximizing the potential for cost savings and innovation.

Public Impact

The primary beneficiaries are the U.S. Army Cyber Command (ARCYBER), receiving essential support for its cyberspace operations. Services delivered likely include cyber defense, network operations, threat analysis, and potentially offensive cyber capabilities. Geographic impact is primarily within the U.S. military's cyber domain, with potential global implications for national security. Workforce implications include the potential for highly skilled cybersecurity professionals employed by Peraton and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

CPAF contracts can sometimes lead to higher final costs if award fees are maximized, requiring diligent oversight.
The complexity of cyber operations means performance monitoring is crucial to ensure mission success and prevent cost overruns.
Reliance on a single prime contractor for critical cyber functions necessitates robust risk management and contingency planning.

Positive Signals

Awarded through full and open competition, indicating a robust and fair bidding process.
The CPAF structure incentivizes contractor performance, aligning Peraton's goals with ARCYBER's mission objectives.
The long contract duration suggests a stable, long-term partnership to meet evolving cyber threats.

Sector Analysis

This contract falls within the broader Information Technology and Professional Services sector, specifically focusing on specialized engineering and cyber operations support. The market for cybersecurity services is rapidly growing, driven by increasing digital threats and the expansion of government and commercial digital footprints. Comparable spending benchmarks for large-scale cyber support contracts often run into hundreds of millions of dollars over several years, reflecting the complexity and criticality of these services. This award represents a significant investment by the government in maintaining its cyber superiority.

Small Business Impact

The data indicates that small business participation (sb) was false, and there was no specific small business set-aside (ss) noted for this contract. This suggests the primary award was made to a large business prime contractor. While not directly set aside for small businesses, large prime contractors are often required to meet subcontracting goals. The impact on the small business ecosystem will depend on Peraton's subcontracting plan and its ability to leverage specialized small businesses for specific cyber capabilities.

Oversight & Accountability

Oversight for this contract is likely managed by the General Services Administration (GSA) contracting officers and the U.S. Army Cyber Command (ARCYBER) program officials. The Cost Plus Award Fee (CPAF) structure necessitates close monitoring of performance metrics and cost expenditures to ensure value for money and prevent potential overruns. Transparency is generally maintained through contract reporting mechanisms, and while specific Inspector General (IG) jurisdiction isn't detailed here, the Department of Defense's IG would likely have oversight over ARCYBER-related expenditures.

Related Government Programs

ARCYBER Cyberspace Operations
DoD Cyber Command Contracts
GSA IT Schedule Contracts
Engineering Services for Defense
Cybersecurity Support Services

Risk Flags

Potential for cost overruns in CPAF structure
Defining clear performance metrics for cyber operations
Ensuring adequate small business subcontracting
Managing contractor performance over a long duration
Cybersecurity risks associated with contractor access

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $487.8 million to PERATON TECHNOLOGY SERVICES INC.. IGF::OT::IGF TASK ORDER AWARD FOR ARCYBER CYBERSPACE OPS REQUIREMENT

Who is the contractor on this award?

The obligated recipient is PERATON TECHNOLOGY SERVICES INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $487.8 million.

What is the period of performance?

Start: 2019-02-11. End: 2024-02-11.

What is Peraton Technology Services Inc.'s track record with large federal cyber contracts?

Peraton Technology Services Inc. has a significant track record with large federal contracts, particularly in the defense and intelligence sectors, including extensive work in space, intelligence, cyber, and defense communications. They have been awarded numerous prime contracts and task orders valued in the hundreds of millions and billions of dollars. Their experience often involves providing advanced technology and mission-critical solutions to agencies like the Department of Defense, NASA, and intelligence community components. This includes managing complex programs, developing sophisticated systems, and providing operational support. Their history suggests a capacity to handle large-scale, long-term requirements such as the ARCYBER cyberspace operations contract.

How does the $487.8M contract value compare to similar ARCYBER or DoD cyber support contracts?

The $487.8 million contract value over five years for ARCYBER cyberspace operations is substantial and aligns with the typical scale of major support contracts awarded by the Department of Defense (DoD) for critical mission areas like cyber. For context, other large DoD cyber support contracts, including those for U.S. Cyber Command (USCYBERCOM) or various service branches' cyber units, often range from tens to hundreds of millions of dollars annually. Contracts for advanced cyber defense, network operations, intelligence analysis, and offensive cyber capabilities are inherently expensive due to the specialized expertise, technology, and long-term commitment required. This award appears to be in line with, or potentially slightly above average for, a comprehensive, multi-year cyber operations support requirement at this command level.

What are the primary risks associated with a Cost Plus Award Fee (CPAF) contract for cyber operations?

The primary risks associated with a Cost Plus Award Fee (CPAF) contract for cyber operations revolve around cost control and performance definition. While CPAF incentivizes performance by offering award fees based on achieving specific metrics, there's a risk that the government may pay higher total costs if the contractor excels and earns maximum award fees, potentially exceeding what a fixed-price contract might have cost. Defining clear, measurable, and achievable performance objectives (the 'award fee criteria') is critical and challenging in dynamic cyber environments. Inadequate criteria can lead to disputes or the government paying for less-than-optimal performance. Diligent oversight is essential to ensure costs remain reasonable and award fees are justified by exceptional performance.

How effective is GSA's Federal Acquisition Service in procuring specialized IT and engineering services like this?

GSA's Federal Acquisition Service (FAS) is generally effective in procuring a wide range of IT and engineering services for federal agencies, leveraging established contract vehicles like GSA Schedules. FAS provides procurement expertise, streamlined processes, and access to a broad base of pre-vetted vendors, which can accelerate acquisition timelines and ensure compliance. For highly specialized services like advanced cyberspace operations, FAS often facilitates competition among capable contractors. However, the ultimate effectiveness also depends on the specific requirements definition by the requesting agency (ARCYBER in this case) and the diligence of the GSA contracting team in managing the procurement process and ensuring the chosen solution meets the complex technical and operational needs.

What are the historical spending patterns for ARCYBER cyberspace operations support?

Historical spending patterns for ARCYBER cyberspace operations support, and cyber operations broadly within the DoD, have shown a consistent upward trend over the past decade. This reflects the increasing importance of cyber as a domain of warfare and national security, coupled with evolving threat landscapes. Agencies like ARCYBER require sustained investment in personnel, technology, and services to maintain readiness and operational effectiveness. Spending typically covers areas such as network defense, threat intelligence, vulnerability management, incident response, and the development/deployment of cyber tools. While specific historical figures for this exact task order are not provided, the overall trend indicates significant and growing federal investment in cyber capabilities.

What is the significance of the 5-year duration (1826 days) for this contract?

The 5-year duration (1826 days) for this contract is highly significant as it indicates a long-term strategic commitment by ARCYBER to sustain and enhance its cyberspace operations capabilities. Such extended periods are necessary in the cyber domain due to the lengthy development cycles for advanced technologies, the need for continuous adaptation to evolving threats, and the requirement for stable, skilled workforces. A longer duration allows the contractor, Peraton, to invest in specialized personnel, training, and infrastructure, fostering deeper expertise and potentially leading to greater efficiencies and innovation over time. It also provides predictability for both the government and the contractor, facilitating better planning and resource allocation for critical national security missions.

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: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 15050 CONFERENCE CENTER DR, CHANTILLY, VA, 20151

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

Financial Breakdown

Contract Ceiling: $1,594,002,704

Exercised Options: $781,475,392

Current Obligation: $487,767,432

Actual Outlays: $-1,119,025

Subaward Activity

Number of Subawards: 100

Total Subaward Amount: $712,544,395

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q14OADU128

IDV Type: IDC

Timeline