DoD's $13.89M Naval Digital Transformation Contract Awarded to Delta Constellation Group

Contract Overview

Contract Amount: $13,887,439 ($13.9M)

Contractor: Delta Constellation Group, LLC

Awarding Agency: Department of Defense

Start Date: 2020-09-10

End Date: 2023-09-13

Contract Duration: 1,098 days

Daily Burn Rate: $12.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: NAVAL DIGITAL TRANSFORMATION AND INTEGRATION SYSTEMS ENGINEERING AND PLANNING FOR NAVAL DIGITAL INTEGRATION SUPPORT CELL

Place of Performance

Location: ALEXANDRIA, ALEXANDRIA CITY County, VIRGINIA, 22304

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $13.9 million to DELTA CONSTELLATION GROUP, LLC for work described as: NAVAL DIGITAL TRANSFORMATION AND INTEGRATION SYSTEMS ENGINEERING AND PLANNING FOR NAVAL DIGITAL INTEGRATION SUPPORT CELL Key points: 1. Contract focuses on R&D for naval digital integration, a critical area for modernization. 2. Awarded under full and open competition, suggesting a competitive bidding process. 3. The contract duration of approximately three years indicates a significant, ongoing effort. 4. The use of Cost Plus Fixed Fee (CPFF) pricing can present cost control challenges. 5. This award falls within the Research and Development sector, specifically physical and engineering sciences. 6. The contract is a delivery order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle or contract.

Value Assessment

Rating: fair

Benchmarking the value of this $13.89 million contract is challenging without specific deliverables or comparable R&D projects. The CPFF structure requires careful oversight to ensure costs remain reasonable and aligned with the fixed fee. While the total award amount is moderate for R&D, its effectiveness will depend on the successful integration and adoption of the digital solutions developed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating that while the initial pool of potential bidders might have been narrowed, the final award was made through a competitive process. The presence of two bids suggests some level of competition, but the specifics of the exclusion process would be needed to fully assess its breadth and impact on price discovery.

Taxpayer Impact: A competitive award process, even with initial exclusions, generally benefits taxpayers by encouraging multiple firms to offer their best pricing and technical solutions, potentially leading to a more cost-effective outcome.

Public Impact

The primary beneficiaries are the U.S. Navy and Department of Defense, gaining enhanced digital capabilities for naval operations. Services delivered include research and development for digital transformation and integration systems engineering. The geographic impact is likely centered around naval bases and operational theaters where digital integration is crucial. Workforce implications may include the need for specialized R&D personnel and integration experts within the defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contracts can incentivize contractors to increase costs to maximize their fee, requiring robust oversight.
The 'exclusion of sources' in the competition phase warrants further investigation to ensure it did not unduly limit competition.
Lack of specific performance metrics makes it difficult to assess the true value and success of the R&D effort.

Positive Signals

Awarded under full and open competition, indicating a structured procurement process.
The contract addresses a critical modernization need within the Navy's digital infrastructure.
The contractor, Delta Constellation Group, LLC, is performing work for the Department of Defense.

Sector Analysis

This contract falls under the Research and Development (R&D) sector, specifically NAICS code 541715, which covers R&D in physical, engineering, and life sciences. This sector is characterized by innovation and the pursuit of new technologies. Comparable spending in this area within the DoD is substantial, as digital transformation is a key strategic priority across all branches of the military. The market for defense R&D services is competitive, with many firms specializing in advanced engineering and scientific solutions.

Small Business Impact

The contract data indicates that small business participation (ss: false, sb: false) was not a primary set-aside consideration for this specific award. Therefore, the direct impact on small businesses through this contract is likely minimal. However, the prime contractor may engage small businesses as subcontractors, depending on the project's needs and their subcontracting plans, which are not detailed here.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the Defense Contract Management Agency (DCMA). The CPFF structure necessitates close monitoring of costs and progress to ensure adherence to the fixed fee and overall budget. Transparency is generally maintained through contract reporting requirements, but specific details on public accessibility of progress reports or audits would require further inquiry.

Related Government Programs

Naval Digital Integration
Defense R&D Spending
Systems Engineering Contracts
Digital Transformation Initiatives
Department of Defense IT Modernization

Risk Flags

Cost Overruns Risk (CPFF)
Limited Competition Due to Source Exclusion
Unclear Performance Metrics
Potential for Scope Creep

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.9 million to DELTA CONSTELLATION GROUP, LLC. NAVAL DIGITAL TRANSFORMATION AND INTEGRATION SYSTEMS ENGINEERING AND PLANNING FOR NAVAL DIGITAL INTEGRATION SUPPORT CELL

Who is the contractor on this award?

The obligated recipient is DELTA CONSTELLATION GROUP, LLC.

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 $13.9 million.

What is the period of performance?

Start: 2020-09-10. End: 2023-09-13.

What is the track record of Delta Constellation Group, LLC with DoD contracts, particularly in R&D and digital transformation?

Delta Constellation Group, LLC has a history of performing contracts for the Department of Defense. While specific details on their track record in R&D and digital transformation require a deeper dive into contract databases, their award for this Naval Digital Transformation and Integration Systems Engineering project suggests they possess relevant capabilities. Analyzing past performance reviews, contract values, and the types of services rendered on previous DoD engagements would provide a clearer picture of their expertise, reliability, and success in delivering complex technical solutions within the defense sector. It is important to note that this contract is a delivery order, implying it may be part of a larger IDIQ vehicle, which could indicate a pre-existing relationship or qualification with the DoD.

How does the $13.89 million award compare to similar R&D contracts for naval digital transformation?

The $13.89 million award for naval digital transformation and integration systems engineering is a moderate-sized contract within the broader defense R&D landscape. However, direct comparisons are difficult without knowing the specific scope, deliverables, and duration of comparable contracts. Naval digital transformation is a complex and evolving field, and R&D efforts can vary significantly in scale and cost. Larger, more comprehensive digital overhaul projects could easily exceed this amount, while smaller, more focused research initiatives might be valued lower. Benchmarking would ideally involve looking at other contracts awarded under similar NAICS codes (541715) for naval or broader DoD digital initiatives, considering factors like the number of bidders, contract type (e.g., CPFF, FFP), and the specific technological areas addressed.

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

The primary risk for the DoD with a CPFF contract structure is the potential for cost overruns. While the 'fixed fee' provides a ceiling for the contractor's profit, the 'cost plus' element means the government reimburses the contractor for all allowable costs incurred. This can incentivize contractors to incur higher costs, as their fee is a percentage of or fixed amount on top of these costs. Effective risk mitigation requires robust government oversight, including detailed cost tracking, auditing of expenses, and clear definition of allowable costs. Without stringent management, the total project cost could exceed initial estimates, diminishing the value for money.

How effective is the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' in ensuring optimal value for taxpayers?

The effectiveness of 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' in ensuring optimal value for taxpayers is nuanced. On one hand, it signifies a move towards broader competition than a sole-source award, which generally benefits taxpayers by fostering price discovery and innovation. However, the 'exclusion of sources' implies that certain potential bidders were not considered from the outset. The degree to which this exclusion limits competition is critical. If the exclusion was based on legitimate technical qualifications or specific requirements that only a few could meet, it might be justifiable. But if it arbitrarily narrows the field, it could reduce competitive pressure, potentially leading to higher prices or less innovative solutions than might have been achieved with wider participation. Thorough documentation justifying the exclusion is key to assessing its impact on taxpayer value.

What are the potential long-term implications of this contract for the Navy's digital capabilities?

This contract has the potential to significantly enhance the Navy's digital capabilities by focusing on transformation and integration. Successful R&D in this area could lead to more efficient data sharing, improved command and control systems, enhanced cybersecurity, and better operational readiness. The integration of digital systems is crucial for modern naval warfare, enabling faster decision-making and more effective deployment of assets. The long-term implications depend heavily on the successful implementation and adoption of the technologies developed, as well as the Navy's ability to sustain and upgrade these systems over time. It represents an investment in future operational effectiveness and technological superiority.

Are there any specific performance metrics or KPIs associated with this contract that indicate success?

The provided data does not include specific performance metrics or Key Performance Indicators (KPIs) for this contract. For R&D contracts, especially those using a CPFF structure, success is often measured by the achievement of defined research objectives, the successful development of prototypes or technologies, and the ability to transition these developments into operational systems. Without access to the contract's Statement of Work (SOW) or Performance Work Statement (PWS), it is impossible to ascertain the specific KPIs. Typically, these would outline technical milestones, delivery schedules for research outputs, and potentially measures of system performance or efficiency gains once implemented.

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: RESEARCH AND DEVELOPMENT › OTHER RESEARCH/DEVELOPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1100 NEW JERSEY AVE SE STE 400, WASHINGTON, DC, 20003

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $13,887,439

Exercised Options: $13,887,439

Current Obligation: $13,887,439

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA807519D0022

IDV Type: IDC

Timeline