Leidos, Inc. awarded $978.8M for Research Support Services, with a significant portion allocated to West Virginia
Contract Overview
Contract Amount: $978,791,366 ($978.8M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Energy
Start Date: 2018-12-31
End Date: 2028-12-30
Contract Duration: 3,652 days
Daily Burn Rate: $268.0K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS INCENTIVE FEE
Sector: R&D
Official Description: RESEARCH SUPPORT SERVICES (RSS)
Place of Performance
Location: MORGANTOWN, MONONGALIA County, WEST VIRGINIA, 26507
Plain-Language Summary
Department of Energy obligated $978.8 million to LEIDOS, INC. for work described as: RESEARCH SUPPORT SERVICES (RSS) Key points: 1. Contract value of nearly $1 billion indicates a substantial, long-term commitment to research support. 2. The definitive contract structure suggests a need for ongoing, flexible services over an extended period. 3. A Cost Plus Incentive Fee (CPIF) pricing structure aims to balance contractor performance with cost control. 4. The contract's duration of 10 years (3652 days) points to strategic planning and sustained operational requirements. 5. The primary service area, R&D in Physical, Engineering, and Life Sciences, is critical for technological advancement. 6. The contract is not set aside for small businesses, suggesting a focus on large, capable prime contractors.
Value Assessment
Rating: good
The contract's total value of $978.8 million over 10 years averages to approximately $97.9 million annually. Benchmarking this against similar large-scale R&D support contracts is challenging without more specific service details. However, the CPIF pricing model suggests an effort to achieve value by incentivizing efficient performance. The base award amount of $268,015 appears to be an initial commitment, with the majority of the contract value being contractually authorized over time.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of two bidders suggests a competitive environment, though the specific details of the bidding process and the nature of the competition (e.g., number of proposals received, evaluation criteria) are not fully detailed here. Full and open competition generally promotes price discovery and can lead to more favorable pricing for the government.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining competitive pricing and ensures that the government is not limited to a single provider, potentially driving down costs through market forces.
Public Impact
The Department of Energy benefits from essential research support services, enabling its mission-critical scientific endeavors. The contract supports advanced research and development activities across physical, engineering, and life sciences. A significant portion of the contract's performance is expected to occur in West Virginia, potentially boosting the local economy and workforce. The contract facilitates the advancement of scientific knowledge and technological innovation within the United States.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- CPIF contracts can lead to cost overruns if not carefully managed and monitored, as the government shares in cost savings and overruns.
- The long duration of the contract may present challenges in adapting to rapidly evolving research needs and technological advancements.
- Reliance on a single large contractor for extensive research support could create vendor lock-in and limit future flexibility.
Positive Signals
- Full and open competition suggests a robust selection process, likely resulting in a qualified and capable contractor.
- The CPIF structure incentivizes the contractor to perform efficiently and effectively, potentially leading to better value.
- The long-term nature of the contract provides stability and continuity for critical research support functions.
Sector Analysis
The contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. This sector is characterized by significant government investment aimed at fostering innovation and technological progress. The total contract value of nearly $1 billion over a decade places it among substantial R&D support agreements. Comparable spending benchmarks would typically involve analyzing other large federal contracts for scientific research support, often awarded by agencies like the Department of Defense, NASA, or NIH, to gauge cost-effectiveness and market rates for similar services.
Small Business Impact
This contract was not set aside for small businesses, as indicated by `ss: false` and `sb: false`. This suggests that the scope and complexity of the research support services required are likely beyond the capacity of most small businesses to perform as prime contractors. While there is no direct small business set-aside, there may be opportunities for small businesses to participate as subcontractors to Leidos, Inc., depending on the specific requirements and subcontracting plans developed by the prime contractor.
Oversight & Accountability
Oversight for this contract would primarily reside with the Department of Energy's contracting officers and program managers. The Cost Plus Incentive Fee (CPIF) structure implies performance metrics and cost targets that will be monitored to determine incentive payouts. Transparency is generally facilitated through contract databases like FPDS.gov, which provide public access to contract awards. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's performance.
Related Government Programs
- Department of Energy Research and Development Programs
- Federal Scientific Research Support Services
- National Laboratory Support Contracts
- Advanced Technology Development Contracts
Risk Flags
- Potential for cost overruns due to CPIF structure.
- Risk of scope obsolescence over the 10-year duration.
- Vendor lock-in due to long-term commitment.
- Challenges in sustained oversight over a decade.
Tags
research-and-development, department-of-energy, definitive-contract, cost-plus-incentive-fee, full-and-open-competition, large-contract, long-term-contract, scientific-research, west-virginia, leidos-inc
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $978.8 million to LEIDOS, INC.. RESEARCH SUPPORT SERVICES (RSS)
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $978.8 million.
What is the period of performance?
Start: 2018-12-31. End: 2028-12-30.
What is the historical spending pattern for Research Support Services (RSS) by the Department of Energy?
Analyzing historical spending patterns for Research Support Services (RSS) by the Department of Energy requires access to detailed historical contract data. Without specific historical figures for this contract or similar RSS contracts, it's difficult to provide precise figures. However, the current award of $978.8 million over 10 years suggests a significant and sustained investment in R&D support. Agencies like the DOE typically have consistent needs for research infrastructure, technical expertise, and administrative support to manage their extensive research portfolios. Fluctuations in historical spending might be influenced by shifts in national research priorities, budget allocations, and the lifecycle of major research projects. A comprehensive review would involve examining annual outlays for RSS contracts over several fiscal years to identify trends, peak spending periods, and the average contract values within this category.
How does the Cost Plus Incentive Fee (CPIF) structure for this contract compare to other R&D support contracts?
The Cost Plus Incentive Fee (CPIF) structure is a common contract type used for R&D and services where performance outcomes and costs are somewhat uncertain but can be influenced by contractor effort. In a CPIF contract, the final profit is adjusted based on whether the final cost is below or above a target cost, and performance targets are met. Compared to other R&D support contracts, CPIF aims to provide a balance: it allows for flexibility in scope and cost, which is crucial for research, while incentivizing the contractor to achieve cost efficiencies and performance goals. Other contract types might include Cost Plus Fixed Fee (CPFF), which offers less incentive for cost control, or Firm-Fixed-Price (FFP), which is less suitable for R&D due to inherent uncertainties. The suitability of CPIF depends on the government's ability to define clear performance objectives and cost targets that can be objectively measured.
What are the potential risks associated with a 10-year contract for research support services?
A 10-year contract for research support services presents several potential risks. Firstly, the rapid pace of technological advancement in R&D means that the services required could evolve significantly over the contract's lifespan, potentially making the initial scope of work outdated or insufficient. This could lead to costly contract modifications or a need for renegotiation. Secondly, long-term reliance on a single contractor can lead to vendor lock-in, reducing the government's flexibility to switch providers or adopt new technologies if the incumbent contractor is slow to adapt or becomes less competitive. Thirdly, maintaining consistent oversight and performance management over such an extended period requires sustained institutional knowledge and resources within the contracting agency. Finally, economic or political shifts could impact funding levels, potentially leading to contract disputes or early termination if budgets are cut.
How does the geographic concentration in West Virginia impact the contract's value and performance?
The mention of West Virginia (WV) as the state of performance suggests a significant operational footprint there. This geographic concentration can impact the contract's value by potentially lowering travel costs if the primary research facilities or personnel are located there. It could also lead to economic benefits for the local region through job creation and local procurement. From a performance perspective, having a concentrated workforce and facilities in one area can foster team cohesion and streamline operations. However, it also introduces risks related to local economic conditions, natural disasters, or regulatory changes specific to West Virginia. The value proposition is enhanced if leveraging local expertise or facilities provides a cost or performance advantage, but it necessitates careful management of any localized risks.
What is Leidos, Inc.'s track record with large federal R&D support contracts?
Leidos, Inc. has a substantial track record as a major government contractor, including significant involvement in research and development support across various federal agencies. They are known for providing a wide range of services, from scientific research and engineering to IT solutions and logistics, often supporting complex, large-scale programs. Their experience typically includes managing large workforces, handling sensitive data, and operating within stringent regulatory environments. While specific details of their performance on past R&D support contracts would require deeper analysis of contract performance reports and past performance evaluations, Leidos is generally considered a capable and experienced provider for contracts of this magnitude and complexity. Their history suggests an ability to manage multi-year, multi-billion dollar programs.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: DE-SOL-0010762
Offers Received: 2
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 700 N FREDERICK AVE, GAITHERSBURG, MD, 20879
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $1,200,000,000
Exercised Options: $1,200,000,000
Current Obligation: $978,791,366
Actual Outlays: $732,842,783
Subaward Activity
Number of Subawards: 1135
Total Subaward Amount: $1,373,946,579
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2018-12-31
Current End Date: 2028-12-30
Potential End Date: 2028-12-30 00:00:00
Last Modified: 2026-04-13
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