DoD's $37.3M Peraton Contract for Atmosphere & Space Systems Support Faces Scrutiny
Contract Overview
Contract Amount: $37,266,906 ($37.3M)
Contractor: Peraton Inc.
Awarding Agency: Department of Defense
Start Date: 2022-02-01
End Date: 2026-12-31
Contract Duration: 1,794 days
Daily Burn Rate: $20.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: MISSION SYSTEM SUPPORT SERVICES FOR ATMOSPHERE AND SPACE SYSTEMS (MSS 2) BASIC CONTRACT IN SUPPORT OF AFTAC
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20171
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $37.3 million to PERATON INC. for work described as: MISSION SYSTEM SUPPORT SERVICES FOR ATMOSPHERE AND SPACE SYSTEMS (MSS 2) BASIC CONTRACT IN SUPPORT OF AFTAC Key points: 1. Contract awarded to Peraton Inc. for critical mission system support. 2. The contract is a Cost Plus Fixed Fee (CPFF) type, potentially leading to cost overruns. 3. Lack of small business participation noted. 4. The contract falls under Custom Computer Programming Services (NAICS 541511).
Value Assessment
Rating: questionable
The Cost Plus Fixed Fee (CPFF) contract type can incentivize contractors to increase costs, as their fee is a percentage of the total cost. Without strong oversight, this can lead to inefficient spending compared to fixed-price contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the CPFF structure may still allow for price escalation beyond initial expectations.
Taxpayer Impact: Taxpayer funds are at risk of being spent inefficiently due to the CPFF contract type, which could lead to higher overall costs than anticipated.
Public Impact
Ensures continued operation of vital atmosphere and space systems for the Air Force. Supports national security by maintaining critical technological infrastructure. Potential for cost overruns impacts the efficient use of taxpayer dollars.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- CPFF contract type
- No small business participation
- Potential for cost overruns
Positive Signals
- Full and open competition
- Supports critical national security systems
Sector Analysis
This contract falls within the IT services sector, specifically custom computer programming. Spending in this area is substantial across the government, with benchmarks varying widely based on complexity and service level agreements.
Small Business Impact
The contract explicitly states no small business participation (ss: false, sb: false). This indicates a missed opportunity to support small businesses and potentially leverage specialized capabilities they offer.
Oversight & Accountability
The CPFF contract type necessitates robust oversight from the Department of the Air Force to ensure costs are reasonable and the fixed fee is justified. Monitoring contractor performance and expenditures is crucial for accountability.
Related Government Programs
- Custom Computer Programming Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Cost Plus Fixed Fee (CPFF) contract type incentivizes higher spending.
- Lack of small business participation.
- Potential for cost overruns impacting taxpayer value.
- Critical systems support requires stringent oversight to mitigate performance risks.
Tags
custom-computer-programming-services, department-of-defense, va, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $37.3 million to PERATON INC.. MISSION SYSTEM SUPPORT SERVICES FOR ATMOSPHERE AND SPACE SYSTEMS (MSS 2) BASIC CONTRACT IN SUPPORT OF AFTAC
Who is the contractor on this award?
The obligated recipient is PERATON INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $37.3 million.
What is the period of performance?
Start: 2022-02-01. End: 2026-12-31.
What is the projected total cost of the contract given the CPFF structure and the contract's duration?
The base contract value is $37.3 million, with an estimated completion date in late 2026, spanning nearly five years. The Cost Plus Fixed Fee (CPFF) structure means the final cost is not fixed and depends on actual expenses incurred by Peraton Inc., plus a predetermined fee. Without detailed cost breakdowns and rigorous oversight, predicting the final expenditure is challenging, but it is likely to exceed the initial $37.3 million.
What are the specific risks associated with Peraton Inc. managing these critical systems under a CPFF contract?
The primary risk with a CPFF contract is the contractor's incentive to increase costs, as their fee is a percentage of those costs. This can lead to less cost-consciousness and potential inefficiencies. For critical systems, any performance issues or delays could have significant national security implications, compounded by the difficulty in controlling costs.
How effectively does this contract ensure the long-term value and technological advancement of the Atmosphere and Space Systems?
The CPFF structure inherently prioritizes service delivery over cost efficiency, potentially limiting long-term value if costs escalate significantly. While the contract ensures continuity of operations, it doesn't explicitly incentivize innovation or cost-saving technological advancements. The Air Force must actively manage the contract to ensure value and push for modernization within the existing framework.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: FA702221R0001
Offers Received: 2
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 12975 WORLDGATE DR STE 7322, HERNDON, VA, 20170
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $47,053,957
Exercised Options: $37,943,885
Current Obligation: $37,266,906
Actual Outlays: $6,510,576
Subaward Activity
Number of Subawards: 2
Total Subaward Amount: $1,341,055
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2022-02-01
Current End Date: 2026-12-31
Potential End Date: 2027-11-30 00:00:00
Last Modified: 2025-12-18
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