Army awards $111.5M contract for IT services, with Jacobs Technology Inc. as incumbent

Contract Overview

Contract Amount: $55,319,405 ($55.3M)

Contractor: Jacobs Technology Inc.

Awarding Agency: Department of Defense

Start Date: 2003-04-15

End Date: 2005-06-27

Contract Duration: 804 days

Daily Burn Rate: $68.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: 200307!003054!2100!AH01 !USA AVIATION AND MISSILE COMMAND!DAAH0103C0127 !A!N! !N! !20030415!20040414!111472226!111472226!074103508!N!SVERDRUP TECHNOLOGY, INC !6703 ODYSSEY DR NW #304 !HUNTSVILLE !AL!35806!37000!089!01!HUNTSVILLE !MADISON !ALABAMA !+000001776846!N!N!000000000000!D399!OTHER ADP & TELECOMMUNICATION SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !541511!E! !3! ! ! ! ! !99990909!B!F!N!A! !A!U!U!2!004!B! !C!N!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35806, UNITED STATES OF AMERICA

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $55.3 million to JACOBS TECHNOLOGY INC. for work described as: 200307!003054!2100!AH01 !USA AVIATION AND MISSILE COMMAND!DAAH0103C0127 !A!N! !N! !20030415!20040414!111472226!111472226!074103508!N!SVERDRUP TECHNOLOGY, INC !6703 ODYSSEY DR NW #304 !HUNTSVILLE !AL!35806!37000!089!01!HUNTSVILLE !MADISON !ALABAMA !+000001776846!N!N!000000000000!D… Key points: 1. Contract value of $111.5M over 804 days suggests a significant investment in IT support. 2. The 'Custom Computer Programming Services' category indicates a focus on specialized software development and IT solutions. 3. The contract's duration of over two years points to a need for sustained IT support and development. 4. The incumbent contractor, Jacobs Technology Inc., has prior experience with this type of service, potentially offering continuity. 5. The 'COST PLUS FIXED FEE' contract type may lead to cost overruns if not carefully managed. 6. The award to a single entity, despite full and open competition, warrants scrutiny of the bidding process and final pricing.

Value Assessment

Rating: fair

The total contract value of $111.5 million over approximately 804 days equates to roughly $139,000 per day. Benchmarking this against similar IT service contracts is challenging without more granular data on the specific services provided. However, the 'COST PLUS FIXED FEE' (CPFF) contract type can sometimes lead to higher costs than fixed-price contracts if the contractor's costs exceed initial estimates. The contract's duration and value suggest a substantial scope of work, but a detailed cost-benefit analysis would be needed to fully assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION,' indicating that all responsible sources were permitted to submit bids. The presence of 4 bids suggests a moderate level of competition. While full and open competition is generally preferred for maximizing price discovery, the fact that it resulted in a single award to Jacobs Technology Inc. warrants further investigation into the evaluation criteria and the specific technical or cost proposals submitted by the bidders.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing inherent in a full and open competition. However, the ultimate savings depend on the effectiveness of the evaluation process and the final negotiated price.

Public Impact

The primary beneficiaries are the U.S. Army units and personnel who will receive enhanced IT services and custom computer programming. Services delivered include custom computer programming, IT support, and potentially related telecommunication services. The geographic impact is likely centered around Army installations where these IT services are required, with potential for broader national defense implications. Workforce implications may include the direct employment of IT professionals by the contractor and potential indirect impacts on military personnel relying on these services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'COST PLUS FIXED FEE' contract type carries inherent risks of cost escalation if contractor expenses exceed projections.
While competed, the award to a single entity suggests potential challenges in achieving the most competitive pricing possible.
Lack of specific details on performance metrics makes it difficult to assess the contractor's efficiency and effectiveness.
The broad 'OTHER ADP & TELECOMMUNICATION SERVICES' category could mask specific service costs, hindering detailed value analysis.

Positive Signals

The contract was awarded through 'FULL AND OPEN COMPETITION,' indicating an effort to solicit bids from a wide range of potential providers.
The incumbent contractor, Jacobs Technology Inc., likely possesses institutional knowledge and established processes, potentially leading to smoother service delivery.
The contract duration of over two years suggests a stable requirement and a commitment to sustained IT support.
The award to a known entity like Jacobs Technology Inc. may indicate a strong past performance record with the agency.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on custom computer programming services. The IT services market is vast and highly competitive, with government contracts forming a significant portion. Comparable spending benchmarks for custom programming and IT support services vary widely based on complexity, duration, and specific skill sets required. The Army's significant investment reflects the critical role of advanced IT infrastructure and software development in modern military operations.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). There is no explicit information regarding subcontracting plans for small businesses. This suggests that the primary awardee is likely a large business, and the impact on the small business ecosystem would depend on whether Jacobs Technology Inc. actively engages small businesses as subcontractors for specialized services.

Oversight & Accountability

Oversight mechanisms for this contract would typically involve the U.S. Army Contracting Command and potentially the Defense Contract Management Agency (DCMA). Accountability measures are embedded in the 'COST PLUS FIXED FEE' structure, requiring detailed cost reporting and justification from the contractor. Transparency is generally facilitated through contract award databases, but specific performance reviews and audits are often internal to the agency unless flagged by an Inspector General.

Related Government Programs

Army IT Support Services
Custom Software Development Contracts
Defense Information Technology Services
ADP and Telecommunication Services
IT Services for Military Branches

Risk Flags

Cost Overrun Risk (CPFF)
Limited Competition Outcome
Lack of Specific Performance Metrics
Broad Service Category Definition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $55.3 million to JACOBS TECHNOLOGY INC.. 200307!003054!2100!AH01 !USA AVIATION AND MISSILE COMMAND!DAAH0103C0127 !A!N! !N! !20030415!20040414!111472226!111472226!074103508!N!SVERDRUP TECHNOLOGY, INC !6703 ODYSSEY DR NW #304 !HUNTSVILLE !AL!35806!37000!089!01!HUNTSVILLE !MADISON !ALABAMA !+000001776846!N!N!000000000000!D399!OTHER ADP & TELECOMMUNICATION SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !541511!E! !3! ! ! ! ! !99990909!B!F!N!A! !A!U!U!2!004!B! !C!N!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Who is the contractor on this award?

The obligated recipient is JACOBS TECHNOLOGY INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $55.3 million.

What is the period of performance?

Start: 2003-04-15. End: 2005-06-27.

What is the specific breakdown of services provided under this contract, and how do they align with the contractor's core competencies?

The contract is broadly categorized under 'OTHER ADP & TELECOMMUNICATION SERVICES' with a specific North American Industry Classification System (NAICS) code of 541511 for 'Custom Computer Programming Services.' This suggests a primary focus on developing, modifying, and maintaining software tailored to the Army's unique requirements. Services could include software design, coding, testing, debugging, and system integration. While Jacobs Technology Inc. has a broad portfolio, the specific alignment would depend on their internal divisions and expertise in areas like defense-specific software, network programming, or data management solutions. A detailed statement of work (SOW) would provide the precise breakdown.

How does the awarded price of $111.5 million compare to market rates for similar custom computer programming services?

Directly comparing the total contract value of $111.5 million to market rates is difficult without knowing the exact scope, duration, and specific technical requirements. However, we can infer an approximate daily rate of $139,000 ($111.5M / 804 days). For custom programming, rates can vary significantly based on the complexity of the technology, the required security clearances, and the geographic location of the work. Industry benchmarks for senior software engineers can range from $150-$300+ per hour, translating to $240,000-$480,000+ per year per individual. The $139,000 daily rate likely encompasses a team of professionals, project management, overhead, and profit. The 'COST PLUS FIXED FEE' structure means the government pays the actual costs incurred by the contractor plus a negotiated fixed fee, making direct price benchmarking complex without detailed cost breakdowns.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract?

The provided data does not explicitly detail the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. Typically, for custom computer programming and IT services, KPIs and SLAs would be defined in the contract's Statement of Work (SOW). These might include metrics related to software defect rates, system uptime, response times for bug fixes, project milestone completion, adherence to security protocols, and user satisfaction. The 'COST PLUS FIXED FEE' structure often includes performance incentives or penalties tied to achieving specific outcomes. Without access to the SOW, a precise assessment of performance expectations and measurement is not possible.

What is the track record of Jacobs Technology Inc. in delivering similar IT services to the Department of Defense?

Jacobs Technology Inc. (now part of Jacobs Solutions Inc.) has a substantial history of providing engineering, technology, and professional services to various government agencies, including the Department of Defense. Their experience spans areas like aerospace, infrastructure, and IT solutions. For the Department of the Army specifically, they have been involved in numerous contracts related to base operations, facilities engineering, and IT support. Their incumbency on this particular contract suggests a satisfactory performance history with the Army for similar services. A deeper dive into their past performance reviews, contract awards, and any reported issues would provide a more comprehensive understanding of their track record.

How has spending on 'Custom Computer Programming Services' (NAICS 541511) by the Department of the Army evolved over the past five years?

Analyzing the evolution of spending on NAICS code 541511 by the Department of the Army requires access to historical contract databases. Generally, spending in this category has seen a significant increase across the federal government as agencies modernize IT systems, develop new digital capabilities, and enhance cybersecurity. The Army, in particular, has been investing heavily in digital transformation, cloud computing, artificial intelligence, and data analytics, all of which rely on custom programming services. While specific figures for the Army's NAICS 541511 spending over the last five years are not provided here, it is reasonable to assume a growing trend, reflecting the increasing reliance on specialized IT solutions for defense operations and readiness.

What are the potential risks associated with the 'COST PLUS FIXED FEE' (CPFF) contract type for this specific service?

The 'COST PLUS FIXED FEE' (CPFF) contract type presents several risks. Primarily, it shifts some of the cost risk to the government. While the contractor is reimbursed for allowable costs, the 'fixed fee' component is negotiated upfront and remains constant regardless of the final cost. This can incentivize contractors to incur higher costs if the fee is a small percentage of the total projected cost, as their profit margin remains the same. For the government, the risk is that the total cost of performance could significantly exceed initial estimates, potentially leading to a less cost-effective outcome compared to a fixed-price contract. Effective oversight, detailed cost monitoring, and robust auditing are crucial to mitigate these risks and ensure the government receives good value.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 4

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Jacobs Engineering Group Inc (UEI: 074103508)

Address: 6703 ODYSSEY DR NW #304, HUNTSVILLE, AL, 35806

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

Contract Characteristics

Cost or Pricing Data: NO

Timeline