NAVSEA IT Support Contract Awarded to Serco Inc. for $11.3 Million

Contract Overview

Contract Amount: $11,333,861 ($11.3M)

Contractor: Serco Inc

Awarding Agency: General Services Administration

Start Date: 2023-12-20

End Date: 2026-12-19

Contract Duration: 1,095 days

Daily Burn Rate: $10.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: NAVSEA PMSES IT SUPPORT SERVICES FY24

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20024

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $11.3 million to SERCO INC for work described as: NAVSEA PMSES IT SUPPORT SERVICES FY24 Key points: 1. Contract value represents a significant investment in IT infrastructure for the Naval Sea Systems Command. 2. The award was made under full and open competition, suggesting a competitive bidding process. 3. The contract type is Cost Plus Fixed Fee, which allows for cost reimbursement plus a fixed fee, potentially balancing flexibility with cost control. 4. The duration of the contract is three years, indicating a medium-term commitment to these IT services. 5. The primary service category is Computer Systems Design Services, crucial for modern naval operations. 6. The contract is managed by the General Services Administration, a common practice for IT services across federal agencies.

Value Assessment

Rating: good

The contract value of $11.3 million over three years for IT support services appears reasonable given the scope of supporting the Naval Sea Systems Command. Benchmarking against similar large-scale IT support contracts for defense agencies suggests this is within expected ranges. The Cost Plus Fixed Fee structure, while requiring careful oversight, is common for complex IT projects where exact costs may be difficult to predict upfront. Further analysis would involve comparing specific labor rates and overhead costs to industry standards.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The specific number of bidders is not provided, but the nature of the competition suggests a robust process. Full and open competition generally leads to better price discovery and a wider range of technical solutions being considered by the government.

Taxpayer Impact: Taxpayers benefit from full and open competition through potentially lower prices and higher quality services due to the pressure of multiple bidders vying for the contract.

Public Impact

The primary beneficiaries are the personnel within the Naval Sea Systems Command (NAVSEA), who will receive enhanced IT support. The services delivered include computer systems design and related support, essential for maintaining and improving NAVSEA's technological infrastructure. The geographic impact is centered in the District of Columbia, where NAVSEA's operations are likely concentrated. The contract supports the operational readiness and efficiency of the U.S. Navy's shipbuilding and systems command.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts require diligent oversight to ensure costs remain reasonable and the fixed fee is justified.
The specific performance metrics and deliverables need to be clearly defined and monitored to ensure value for money.
Potential for scope creep in Cost Plus Fixed Fee contracts if not managed tightly.

Positive Signals

Awarded under full and open competition, indicating a competitive marketplace was leveraged.
The General Services Administration's involvement suggests adherence to established procurement best practices.
The contract duration of three years provides stability for essential IT services.

Sector Analysis

This contract falls within the broader IT services sector, specifically Computer Systems Design Services. The federal IT services market is substantial, with agencies like the Department of Defense being major spenders. NAVSEA's reliance on IT support highlights the critical role of technology in modern naval operations, encompassing everything from ship design to fleet readiness. Comparable spending benchmarks for similar IT support contracts within defense agencies would typically range in the millions to tens of millions annually, depending on the scope and complexity.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses mandated by a set-aside. However, the prime contractor, Serco Inc., may engage small businesses as subcontractors, depending on their own subcontracting plans and the nature of the services required. The absence of a small business set-aside means the primary competition was open to all business sizes.

Oversight & Accountability

The General Services Administration (GSA) typically provides oversight for contracts awarded through its Federal Acquisition Service. Oversight mechanisms would include contract performance reviews, financial audits, and adherence to GSA procurement regulations. Accountability is ensured through the contract's terms and conditions, including performance standards and payment schedules. Transparency is facilitated by the public nature of contract awards, though specific performance details may be sensitive. Inspector General jurisdiction would likely fall under the GSA's IG or potentially the Department of Defense's IG, depending on the specific oversight agreements.

Related Government Programs

NAVSEA IT Modernization Programs
DoD Enterprise IT Services
GSA IT Schedule Contracts
Naval Warfare Systems Command IT Support
Defense Information Systems Agency (DISA) Services

Risk Flags

Cost Overruns Risk (CPFF)
Scope Creep Potential
Performance Monitoring Challenges
Contractor Dependency

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $11.3 million to SERCO INC. NAVSEA PMSES IT SUPPORT SERVICES FY24

Who is the contractor on this award?

The obligated recipient is SERCO INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $11.3 million.

What is the period of performance?

Start: 2023-12-20. End: 2026-12-19.

What is Serco Inc.'s track record with similar federal IT support contracts?

Serco Inc. has a substantial history of performing IT support and related services for various U.S. federal agencies, including defense and civilian departments. Their portfolio often includes complex system integration, network management, and technical support. While specific performance metrics for past contracts are not detailed here, their continued awards suggest a generally satisfactory performance history. However, like many large government contractors, Serco has faced scrutiny and contract disputes on occasion. A deeper dive into their past performance evaluations, such as Contractor Performance Assessment Reporting System (CPARS) data, would provide a more granular understanding of their reliability and effectiveness in delivering IT services.

How does the $11.3 million contract value compare to previous NAVSEA IT support spending?

Without historical spending data specifically for NAVSEA's IT support services, a direct comparison is challenging. However, the $11.3 million award over three years ($3.77 million annually) for computer systems design services is a moderate-sized contract within the federal IT landscape. Large commands like NAVSEA often have multiple, overlapping IT contracts for various functions. This specific award likely represents a portion of their overall IT budget. To provide a robust comparison, one would need to analyze NAVSEA's historical IT spending trends, identify similar contracts awarded in previous fiscal years, and assess whether this award represents an increase, decrease, or stable level of investment in this particular service area.

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

The primary risks with CPFF contracts, especially for IT services, revolve around cost control and potential for contractor inefficiency. While the fixed fee provides the contractor with an incentive to control costs, the government bears the risk of reimbursing actual costs incurred. This can lead to cost overruns if the project scope is not well-defined or if the contractor's cost management is weak. For IT services, which can be complex and subject to evolving requirements, there's a risk of scope creep, where the project expands beyond its initial definition, driving up costs. Effective oversight, detailed work breakdown structures, and robust change management processes are crucial to mitigate these risks.

How effective is GSA's oversight in ensuring value for money on IT contracts like this?

The General Services Administration (GSA) employs various oversight mechanisms to ensure value for money on IT contracts. These include establishing procurement schedules (like IT Schedule 70, though this was awarded via other means), developing acquisition policies, and providing contract administration support. GSA's Federal Acquisition Service, which managed this award, is experienced in IT procurements. However, the effectiveness of oversight can vary depending on the specific contract, the level of resources dedicated to its administration, and the agency's internal controls. For CPFF contracts, rigorous monitoring of costs, performance, and deliverables by the GSA contracting officer's representative (COR) is paramount to ensuring the government receives fair value and avoids unnecessary expenditures.

What is the potential impact of this contract on the competitive landscape for IT support services in the DC area?

This contract award to Serco Inc. for $11.3 million contributes to the overall IT services market activity in the Washington D.C. metropolitan area, a major hub for federal contracting. While this specific award was competed fully and openly, it represents a significant contract secured by one provider. This could potentially make it more challenging for smaller or less established firms to compete for similar, large-scale NAVSEA contracts in the future, although it also signifies a healthy demand for such services. The presence of large contracts like this can also spur subcontracting opportunities, potentially benefiting small and medium-sized businesses if Serco chooses to engage them.

Are there specific performance indicators or KPIs tied to this contract to measure success?

The provided data does not specify the Key Performance Indicators (KPIs) or specific performance metrics tied to this contract. However, for a Cost Plus Fixed Fee contract, especially one involving IT support services, performance is typically measured against defined deliverables, service level agreements (SLAs), and technical requirements outlined in the contract's Statement of Work (SOW). These might include system uptime, response times for technical support, successful implementation of system upgrades, and adherence to security protocols. The effectiveness of the contract hinges on the clarity and measurability of these performance standards and the rigor with which they are monitored by the government contracting officer's representative (COR).

Industry Classification

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

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - IT MANAGEMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 47QFDA23Q0037

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 12930 WORLDGATE DR STE 600, HERNDON, VA, 20170

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

Financial Breakdown

Contract Ceiling: $23,154,332

Exercised Options: $13,474,780

Current Obligation: $11,333,861

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $1,487,284

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: 47QTCK18D0041

IDV Type: GWAC

Timeline