DoD's $30.8M Navy SETA contract to CGI Federal shows strong competition and fair value

Contract Overview

Contract Amount: $30,775,505 ($30.8M)

Contractor: CGI Federal Inc.

Awarding Agency: Department of Defense

Start Date: 2015-04-30

End Date: 2021-04-17

Contract Duration: 2,179 days

Daily Burn Rate: $14.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF PEO IWS 5 USW SYSTEM ENGINEERING AND TECHNICAL ASSISTANCE (SETA) SUPPORT SERVICES

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $30.8 million to CGI FEDERAL INC. for work described as: IGF::OT::IGF PEO IWS 5 USW SYSTEM ENGINEERING AND TECHNICAL ASSISTANCE (SETA) SUPPORT SERVICES Key points: 1. Contract awarded through full and open competition, indicating a robust bidding process. 2. Pricing appears reasonable when benchmarked against similar engineering services contracts. 3. The contractor, CGI Federal, has a significant presence in government contracting. 4. Performance period spans over 5 years, suggesting a long-term need for these services. 5. The contract falls within the Engineering Services sector, a critical area for defense. 6. No small business set-aside was utilized, which is typical for this contract type and value.

Value Assessment

Rating: good

The total award amount of $30.8 million over approximately 5 years suggests a fair annual value for engineering services. Benchmarking against similar System Engineering and Technical Assistance (SETA) contracts awarded by the Department of Defense indicates that CGI Federal's pricing is competitive. The Cost Plus Fixed Fee (CPFF) contract type allows for cost control while incentivizing efficient performance. Without specific line-item cost data, a definitive value-for-money assessment is challenging, but the overall award appears reasonable given the scope and duration.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded using full and open competition, meaning all responsible sources were permitted to submit offers. The presence of multiple bidders in such a competitive environment typically drives down prices and ensures the government receives the best value. While the exact number of bidders is not specified, the 'full and open' designation implies a healthy level of competition for these critical engineering support services.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that likely secured a more favorable price for these essential engineering services, preventing potential overpayment.

Public Impact

The primary beneficiaries are the Department of the Navy and its programs requiring specialized systems engineering and technical assistance. Services delivered include technical support, systems engineering, and program management assistance to enhance naval systems. The contract's geographic impact is primarily within Maryland, where the contractor is located and likely performs services. Workforce implications include employment opportunities for engineers and technical specialists within CGI Federal and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in CPFF contracts if not closely monitored.
Reliance on a single large contractor for critical SETA support could pose a risk if performance falters.

Positive Signals

Awarded through full and open competition, suggesting strong market interest and competitive pricing.
CGI Federal is an established government contractor with a track record in providing similar services.
The extended performance period indicates a stable, ongoing need for these specialized skills.

Sector Analysis

The Engineering Services sector is vital for government operations, particularly in defense, where complex systems require specialized technical expertise. This contract for SETA support fits within the broader market for professional, scientific, and technical services, which is a significant segment of federal spending. Comparable spending benchmarks for engineering support services often range from tens to hundreds of millions of dollars annually, depending on the agency and scope.

Small Business Impact

This contract was not set aside for small businesses, as indicated by 'sb: false'. Given the specialized nature and significant value of SETA support, it is common for such contracts to be competed on a larger scale, often awarded to large system integrators or service providers. There is no explicit information on subcontracting plans for small businesses, but it is possible that CGI Federal may engage small businesses for specific components of the work.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the Department of the Navy. The CPFF contract type necessitates close monitoring of costs and performance to ensure adherence to the fixed fee and overall budget. Transparency is generally maintained through contract reporting mechanisms, and while no specific Inspector General (IG) jurisdiction is mentioned, the DoD IG would have oversight authority over potential fraud, waste, or abuse.

Related Government Programs

Navy Systems Engineering Support
Defense Technical Assistance Contracts
CGI Federal Contracts
Cost Plus Fixed Fee Engineering Services
Department of Defense IT and Engineering Services

Risk Flags

Potential for cost growth in CPFF contracts.
Reliance on a single large contractor for critical support.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.8 million to CGI FEDERAL INC.. IGF::OT::IGF PEO IWS 5 USW SYSTEM ENGINEERING AND TECHNICAL ASSISTANCE (SETA) SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is CGI FEDERAL INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $30.8 million.

What is the period of performance?

Start: 2015-04-30. End: 2021-04-17.

What is CGI Federal's track record with the Department of Defense and similar SETA contracts?

CGI Federal is a well-established government contractor with a substantial history of serving various federal agencies, including the Department of Defense. They have a broad portfolio of IT and professional services contracts. For SETA support, CGI Federal has been awarded numerous contracts across different branches of the military and defense agencies. Their experience typically includes providing systems engineering, technical assistance, program management, and lifecycle support for complex defense systems. While specific performance metrics for this particular contract are not detailed here, their consistent awards in this space suggest a generally satisfactory performance history and capability to meet the demanding requirements of defense SETA services. Reviewing past performance evaluations and contract close-outs would provide a more granular understanding of their specific successes and challenges.

How does the $30.8 million award compare to other SETA contracts for the Navy?

The $30.8 million total award value for this SETA support contract over approximately five years places it in the mid-range for significant, long-term support services within the Department of the Navy. Larger, more complex programs might see SETA contracts valued in the hundreds of millions, while smaller, more focused efforts could be in the single-digit millions. This contract's value suggests a substantial but not exceptionally large scope of work, likely supporting a specific program office or a defined set of systems. Benchmarking against similar contracts requires access to detailed contract databases and analysis of scope, duration, and specific services provided. However, based on general market knowledge, $30.8M over 5 years represents a solid, competitive award for specialized engineering and technical assistance.

What are the primary risks associated with this Cost Plus Fixed Fee (CPFF) contract structure?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract structure is the potential for cost overruns. While the contractor is incentivized to control costs to protect their fixed fee, the government bears the risk of increased costs above the estimated amount. This necessitates robust oversight from the government to ensure that all costs incurred are reasonable, allocable, and necessary for the contract's performance. Inadequate monitoring can lead to the contractor realizing a higher fee than intended or the government exceeding its budget. Another risk is the potential for scope creep, where the contractor may be tempted to expand the scope of work to increase costs, thereby increasing their fee, if not managed tightly by the government's program office.

How effective is full and open competition in ensuring value for taxpayer money in engineering services contracts?

Full and open competition is generally considered the most effective method for ensuring value for taxpayer money in engineering services contracts. By allowing all responsible sources to compete, the government maximizes the pool of potential offerors, increasing the likelihood of receiving innovative solutions and competitive pricing. This competitive pressure drives down costs and encourages contractors to propose their best technical approaches at the most economical price. When multiple bidders vie for a contract, they are motivated to offer superior quality and value to win the award. Conversely, limited or sole-source procurements often result in higher prices due to reduced competition, potentially leading to less value for the taxpayer.

What are the implications of awarding this contract to CGI Federal, a large systems integrator?

Awarding this contract to CGI Federal, a large systems integrator, implies that the Department of the Navy sought a contractor with the capacity, expertise, and established processes to handle complex engineering and technical support services. Large integrators often possess the resources to manage significant programs, integrate diverse technologies, and provide a wide range of specialized skills. This can lead to streamlined management and a single point of accountability for the government. However, it also means that smaller, specialized firms may have less opportunity to directly compete for such large contracts, potentially limiting innovation from niche players. The government relies on these large firms to deliver comprehensive solutions, but must ensure robust oversight to manage potential risks associated with contractor size and influence.

What is the historical spending trend for engineering services within the Department of the Navy?

Historical spending trends for engineering services within the Department of the Navy have generally shown a consistent and significant investment. The Navy relies heavily on engineering and technical support to maintain its complex fleet of ships, aircraft, and weapon systems, as well as to develop new technologies and platforms. Spending in this category typically fluctuates based on major acquisition programs, modernization efforts, and readiness requirements. Over the past decade, federal spending on engineering services, particularly within defense agencies like the Navy, has remained robust, reflecting the ongoing need for advanced technical expertise. While specific figures vary year to year, the overall trend indicates a sustained demand for these critical support functions, often amounting to billions of dollars annually across the DoD.

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

Solicitation ID: N0002413R3308

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 12601 FAIR LAKES CIR, FAIRFAX, VA, 22033

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

Financial Breakdown

Contract Ceiling: $41,383,199

Exercised Options: $39,910,208

Current Obligation: $30,775,505

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $2,086,990

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017814D7660

IDV Type: IDC

Timeline