Navy training system development contract awarded to Cape Henry Associates for over $44 million

Contract Overview

Contract Amount: $44,031,690 ($44.0M)

Contractor: Cape Henry Associates, Inc

Awarding Agency: Department of Defense

Start Date: 2014-09-29

End Date: 2017-09-25

Contract Duration: 1,092 days

Daily Burn Rate: $40.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::CT::IGF CONTRACTOR SHALL PROVIDE NAVY TRAINING SYSTEM PLAN (NTSP) DEVELOPMENT, TRAINING FRONT END ANALYSIS (FEA), MANPOWER AND WORKLOAD ANALYSIS, TRAINING DEVELOPMENT, PERSONNEL QUALIFICATION STANDARDS (PQS)/JOB QUALIFICATION REQUIREMENTS (JQR) DEVELOPMENT,LOGISTICS SUPPORT AND PROGRAM MANAGEMENT SUPPORT FOR SHIPBOARD HULL, MECHANICAL AND ELECTRICAL (HM&E)EQUIPMENT. THESE PRODUCTS AND PROCESSES ARE TO COMPLY WITH CHIEF OF NAVAL OPERATIONS AND DEPARTMENT OF DEFENSE ACQUISITION GUIDANCE AND INSTRUCTIONS.

Place of Performance

Location: VIRGINIA BEACH, VIRGINIA BEACH CITY County, VIRGINIA, 23451

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $44.0 million to CAPE HENRY ASSOCIATES, INC for work described as: IGF::CT::IGF CONTRACTOR SHALL PROVIDE NAVY TRAINING SYSTEM PLAN (NTSP) DEVELOPMENT, TRAINING FRONT END ANALYSIS (FEA), MANPOWER AND WORKLOAD ANALYSIS, TRAINING DEVELOPMENT, PERSONNEL QUALIFICATION STANDARDS (PQS)/JOB QUALIFICATION REQUIREMENTS (JQR) DEVELOPMENT,LOGISTICS SUPPORT … Key points: 1. Contract focuses on critical training system development for Navy HM&E equipment. 2. Performance period spans nearly three years, indicating a substantial project. 3. The contract type (Cost Plus Fixed Fee) suggests potential for cost overruns. 4. Competition was full and open, implying a robust bidding process. 5. The award value is significant, requiring careful oversight of deliverables. 6. This contract supports the Navy's operational readiness and personnel development.

Value Assessment

Rating: fair

The contract value of $44 million over approximately three years for training system development appears substantial. Benchmarking against similar large-scale training development contracts within the Department of Defense would be necessary for a precise value-for-money assessment. The Cost Plus Fixed Fee (CPFF) contract type, while allowing for flexibility, can sometimes lead to higher final costs if not managed tightly, posing a risk to optimal value realization.

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 three bidders suggests a reasonable level of competition for this specialized service. This competitive environment is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it encourages multiple companies to bid, driving down prices and increasing the likelihood of securing the best value for the government's investment.

Public Impact

Naval personnel will benefit from improved training systems for HM&E equipment. Services delivered include training system plan development, front-end analysis, and logistics support. The geographic impact is primarily within the Navy's operational training infrastructure. Workforce implications include the need for skilled personnel in training development and program management.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type can lead to cost escalation if not closely monitored.
The duration of the contract requires sustained oversight to ensure performance remains on track.
Specific performance metrics and quality control measures need to be rigorously enforced.

Positive Signals

Full and open competition suggests a competitive bidding process, potentially leading to better pricing.
The contract addresses critical training needs for naval operations, contributing to readiness.
The contractor is expected to provide comprehensive support, from development to program management.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting defense-related training and simulation. The market for defense training systems is substantial, driven by the continuous need for advanced and updated training solutions for military personnel. This contract represents a significant investment in maintaining the technological edge and operational effectiveness of naval forces.

Small Business Impact

The provided data does not indicate any small business set-aside or subcontracting requirements for this contract. Therefore, the direct impact on the small business ecosystem is not evident from this award alone. Further analysis would be needed to determine if small businesses were involved as subcontractors.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Navy's contracting and program management offices. Accountability measures would be tied to the contract's performance work statement and delivery schedules. Transparency is generally maintained through contract award databases, though detailed performance reporting may be internal.

Related Government Programs

Navy Training Systems
Defense Acquisition Programs
HM&E Equipment Training
Naval Operations Support
Engineering Services Contracts

Risk Flags

Cost Plus Fixed Fee contract type carries inherent cost overrun risk.
Need for rigorous performance monitoring to ensure quality and timeliness of deliverables.
Potential for scope creep if requirements are not clearly defined and managed.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.0 million to CAPE HENRY ASSOCIATES, INC. IGF::CT::IGF CONTRACTOR SHALL PROVIDE NAVY TRAINING SYSTEM PLAN (NTSP) DEVELOPMENT, TRAINING FRONT END ANALYSIS (FEA), MANPOWER AND WORKLOAD ANALYSIS, TRAINING DEVELOPMENT, PERSONNEL QUALIFICATION STANDARDS (PQS)/JOB QUALIFICATION REQUIREMENTS (JQR) DEVELOPMENT,LOGISTICS SUPPORT AND PROGRAM MANAGEMENT SUPPORT FOR SHIPBOARD HULL, MECHANICAL AND ELECTRICAL (HM&E)EQUIPMENT. THESE PRODUCTS AND PROCESSES ARE TO COMPLY WITH CHIEF OF NAVAL OPERATIONS AND DEPARTMENT OF DEFENSE ACQUISITION GUIDANCE AND I

Who is the contractor on this award?

The obligated recipient is CAPE HENRY ASSOCIATES, 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 $44.0 million.

What is the period of performance?

Start: 2014-09-29. End: 2017-09-25.

What is the track record of Cape Henry Associates, Inc. with similar Department of Defense contracts?

Cape Henry Associates, Inc. has a history of performing contracts for the Department of Defense, often in areas related to training, simulation, and technical support. Analyzing their past performance on similar contracts, particularly those involving complex training system development or program management for naval systems, would provide insight into their reliability and capability. Reviewing past performance evaluations and any reported issues or successes on prior DoD awards would be crucial. This includes examining their ability to meet deadlines, stay within budget constraints (especially relevant for CPFF contracts), and deliver quality products and services as defined by the contract requirements. A detailed review of their contract history can highlight any patterns of excellence or areas that may warrant closer scrutiny for this current award.

How does the value of this contract compare to other Navy training system development contracts?

The award value of approximately $44 million for this training system development contract is substantial. To benchmark its value, it would be necessary to compare it against similar contracts awarded by the Department of the Navy or other branches of the DoD for comparable services. Factors to consider include the scope of work (e.g., complexity of systems, number of training modules developed), the duration of the contract, and the specific technologies or methodologies employed. Contracts for developing training systems for complex platforms like naval HM&E equipment often command higher values due to the specialized knowledge and rigorous development processes required. A comparative analysis would help determine if this contract represents a fair market price for the services rendered, considering the specific requirements and the competitive landscape.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for this type of service?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract for training system development is the potential for cost escalation. While the fixed fee provides the contractor with a guaranteed profit margin, the 'cost plus' component means the government reimburses the contractor for allowable costs incurred. If the contractor's costs exceed initial estimates, the government bears that burden. This can occur due to unforeseen technical challenges, scope creep, or inefficient cost management by the contractor. For the government, the risk is paying more than anticipated for the final product. Effective oversight, stringent cost controls, and clear definition of allowable costs are critical to mitigating these risks and ensuring the government receives good value. Regular audits and performance reviews are essential to monitor expenditures and contractor efficiency.

How effective are the oversight mechanisms for ensuring the successful delivery of training system plans and support?

The effectiveness of oversight mechanisms for this contract hinges on the Department of the Navy's program management and contracting offices. Robust oversight typically involves regular progress meetings, detailed performance reporting requirements, site inspections, and potentially independent verification and validation of deliverables. For a CPFF contract, financial oversight is particularly crucial to ensure that costs are reasonable, allocable, and allowable. The presence of an Inspector General's office within the DoD also provides an additional layer of accountability and audit capability. The success of these mechanisms depends on the diligence of the government personnel assigned to manage the contract and their ability to identify and address performance issues or cost variances promptly.

What is the historical spending pattern for Navy training system development and related engineering services?

Historical spending patterns for Navy training system development and related engineering services reveal a consistent and significant investment by the Department of the Navy. This category of spending is driven by the need to maintain a technologically advanced and well-trained fleet, requiring continuous updates and development of training programs for new and existing platforms. Spending in this area can fluctuate based on shipbuilding schedules, modernization efforts, and evolving operational requirements. Analyzing historical data can reveal trends in contract types utilized (e.g., CPFF, Firm-Fixed-Price), average award values, and the primary contractors involved. Such analysis helps in understanding the long-term commitment to training infrastructure and identifying potential areas for cost efficiencies or strategic sourcing.

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 FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 2877 GUARDIAN LN SE 300, VIRGINIA BEACH, VA, 23452

Business Categories: Category Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $56,940,934

Exercised Options: $56,940,934

Current Obligation: $44,031,690

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017814D8009

IDV Type: IDC

Timeline