DoD's $76.3M C5ISR contract awarded to SAIC for R&D in systems engineering and cyber security

Contract Overview

Contract Amount: $76,338,478 ($76.3M)

Contractor: Science Applications International Corporation

Awarding Agency: Department of Defense

Start Date: 2023-11-13

End Date: 2028-11-12

Contract Duration: 1,826 days

Daily Burn Rate: $41.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: SYSTEMS ENGINEERING, CYBER SECURITY (CS), SYSTEM MODERNIZATION, AND LIFECYCLE LOGISTICS RESEARCH, DEVELOPMENT, AND DEPLOYMENT FOR C5ISR CENTER, ESI DIRECTORATE, QRC BRANCH

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $76.3 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: SYSTEMS ENGINEERING, CYBER SECURITY (CS), SYSTEM MODERNIZATION, AND LIFECYCLE LOGISTICS RESEARCH, DEVELOPMENT, AND DEPLOYMENT FOR C5ISR CENTER, ESI DIRECTORATE, QRC BRANCH Key points: 1. Contract focuses on critical C5ISR capabilities, including cyber security and system modernization. 2. SAIC, a large defense contractor, holds this significant R&D award. 3. The contract duration of five years suggests a long-term need for these services. 4. Awarded under full and open competition, indicating a broad market search. 5. The contract type (Cost Plus Fixed Fee) allows for flexibility in R&D but requires careful cost oversight. 6. Virginia is the primary state for contract performance, potentially impacting the local tech workforce.

Value Assessment

Rating: good

The contract value of $76.3 million over five years for R&D in advanced C5ISR capabilities appears reasonable given the scope. Benchmarking against similar large-scale R&D contracts for complex systems integration and cyber security would provide a more precise value-for-money assessment. The Cost Plus Fixed Fee structure, while common for R&D, necessitates robust oversight to ensure costs remain aligned with the fixed fee and project objectives. Without specific comparable contract data, it's difficult to definitively state if the pricing is aggressive, but the competitive award process suggests a degree of market validation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that the Department of Defense actively sought proposals from a wide range of qualified contractors. The presence of multiple bidders (indicated by 'no': 3, though this likely refers to the number of offers received for this specific delivery order, not the total number of potential bidders in the market) is a positive sign for price discovery. A competitive process generally drives down costs and encourages innovation as contractors vie for the award.

Taxpayer Impact: Taxpayers benefit from a competitive award process that aims to secure the best value for the government by fostering a market where contractors offer their most competitive pricing and technical solutions.

Public Impact

The primary beneficiaries are the Department of Defense, specifically the C5ISR Center, ESI Directorate, QRC Branch, who will receive advanced research, development, and deployment services. Services delivered include critical advancements in systems engineering, cyber security, system modernization, and lifecycle logistics. The geographic impact is primarily centered in Virginia, where the contract is performed, potentially creating or sustaining high-tech jobs in the region. The contract supports the modernization and enhancement of command, control, communications, computers, cyber, intelligence, surveillance, and reconnaissance (C5ISR) capabilities, crucial for national security.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can lead to cost overruns if not managed diligently, as the contractor is reimbursed for allowable costs plus a fixed fee.
The complexity of C5ISR systems and cyber security presents inherent technical risks that could impact project timelines and outcomes.
Reliance on a single large contractor like SAIC for such critical R&D could raise concerns about long-term vendor lock-in or reduced future competition.

Positive Signals

SAIC is a well-established contractor with significant experience in defense R&D and C5ISR, suggesting a strong capability to execute the contract.
The award under full and open competition indicates a robust market assessment and a potentially competitive pricing environment.
The five-year duration allows for sustained focus and development of complex technologies, which is beneficial for long-term strategic goals.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The C5ISR domain is a critical and rapidly evolving area within the defense industry, characterized by significant government investment. The market for C5ISR solutions is substantial, driven by the need for technological superiority in intelligence, surveillance, and reconnaissance. Comparable spending benchmarks would likely be found in other large-scale R&D contracts for advanced defense systems, cyber security solutions, and complex system integration projects, often running into tens or hundreds of millions of dollars.

Small Business Impact

This contract was not awarded as a small business set-aside (ss: false, sb: false). Science Applications International Corporation (SAIC) is a large business. While there are no direct set-aside provisions for small businesses in this prime contract, SAIC, as a large prime contractor, may be required to meet subcontracting goals for small businesses. The extent to which small businesses will participate as subcontractors will depend on SAIC's subcontracting plan and the specific needs of the R&D work, potentially offering opportunities for specialized small businesses in areas like cyber security or niche engineering services.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract will likely be managed by the Department of the Air Force contracting officers and technical representatives. Robust oversight will be crucial to monitor allowable costs, ensure the fixed fee is justified, and track progress against R&D milestones. Transparency will be maintained through regular reporting requirements from SAIC. While specific Inspector General (IG) jurisdiction isn't detailed here, the DoD IG typically has oversight over major defense contracts to investigate fraud, waste, and abuse.

Related Government Programs

DoD C5ISR Modernization Programs
Cyber Security Research and Development Initiatives
Advanced Systems Engineering Contracts
Logistics and Lifecycle Support Services
Department of the Air Force R&D Spending

Risk Flags

Cost Overrun Risk (CPFF Contract Type)
Technical Complexity and Execution Risk
Cyber Security Vulnerabilities
Long-Term Dependency on Contractor

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $76.3 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. SYSTEMS ENGINEERING, CYBER SECURITY (CS), SYSTEM MODERNIZATION, AND LIFECYCLE LOGISTICS RESEARCH, DEVELOPMENT, AND DEPLOYMENT FOR C5ISR CENTER, ESI DIRECTORATE, QRC BRANCH

Who is the contractor on this award?

The obligated recipient is SCIENCE APPLICATIONS INTERNATIONAL CORPORATION.

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 $76.3 million.

What is the period of performance?

Start: 2023-11-13. End: 2028-11-12.

What is Science Applications International Corporation's (SAIC) track record with similar C5ISR and cyber security R&D contracts for the Department of Defense?

SAIC has a substantial track record with the Department of Defense, including extensive work in C5ISR, cyber security, and systems engineering. They are a prime contractor on numerous large-scale defense contracts, often involving complex research, development, and integration efforts. For example, SAIC has been involved in modernizing communication systems, developing advanced sensor technologies, and providing cyber security solutions across various military branches. Their experience typically includes managing large teams, adhering to strict security protocols, and delivering cutting-edge technological advancements. Reviewing their past performance on similar contracts, including any past performance evaluations or award fees received, would provide further insight into their capability to successfully execute this specific $76.3 million award.

How does the $76.3 million contract value compare to historical spending on C5ISR R&D by the Department of the Air Force?

The $76.3 million contract value represents a significant investment in C5ISR R&D over its five-year period. To contextualize this, one would need to examine the Department of the Air Force's historical budget allocations and contract awards specifically for C5ISR research and development. The Air Force, like other branches, invests heavily in maintaining technological superiority in this domain due to its critical role in modern warfare. Annual spending on C5ISR R&D can fluctuate based on strategic priorities and emerging threats, often ranging from hundreds of millions to billions of dollars across the entire service. This specific contract, while substantial, is likely one component of a broader C5ISR modernization strategy. Comparing its value to the average annual spend on similar R&D efforts or to the total budget for the C5ISR Center would provide a clearer picture of its relative scale.

What are the primary risks associated with the Cost Plus Fixed Fee (CPFF) contract type for this R&D effort?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract type for research and development is the potential for cost overruns. In a CPFF structure, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing their profit. If the R&D effort encounters unforeseen technical challenges, scope creep, or inefficiencies, the total costs can escalate significantly beyond initial estimates. While the fixed fee provides the government with some cost certainty regarding profit, the overall contract cost is variable. This necessitates rigorous oversight from the government to ensure that all costs claimed by the contractor are reasonable, allocable, and necessary for the project. Effective management of the CPFF contract requires close monitoring of expenditures, regular audits, and proactive communication to control costs and ensure the project stays within budget expectations.

How does the 'Research and Development in the Physical, Engineering, and Life Sciences' NAICS code (541715) inform the nature of the services being procured?

The North American Industry Classification System (NAICS) code 541715, 'Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology),' indicates that this contract is for fundamental and applied research and experimental development. This involves systematic study to gain new knowledge, with the expectation that the knowledge gained will be used to develop new or improve existing products, processes, or services. For this C5ISR contract, it means the work likely involves exploring novel concepts, designing and testing prototypes, and advancing the state-of-the-art in areas like advanced sensor technology, secure communication protocols, artificial intelligence for intelligence analysis, or sophisticated cyber defense mechanisms. It is distinct from routine engineering services or product manufacturing, focusing instead on innovation and scientific discovery within the specified fields.

What is the significance of this contract being awarded to Science Applications International Corporation (SAIC) under 'Full and Open Competition'?

Awarding this contract to SAIC under 'Full and Open Competition' signifies that the Department of Defense followed a process designed to maximize competition and ensure the best possible value for the government. This means that all responsible sources were permitted to submit a bid, and the contract was awarded to the responsible offeror whose proposal, conforming to the solicitation, was most advantageous to the government, price and other factors considered. For SAIC, it means they successfully competed against other potential bidders in an open market. For the government and taxpayers, it suggests that the selection process was robust, likely resulting in competitive pricing and innovative solutions, as multiple companies had the opportunity to propose their best offerings. This contrasts with sole-source or limited competition awards, where the pool of potential contractors is restricted.

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 › C – National Defense R&D 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: 12010 SUNSET HILLS RD, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $231,838,278

Exercised Options: $231,838,278

Current Obligation: $76,338,478

Actual Outlays: $2,337,019

Subaward Activity

Number of Subawards: 61

Total Subaward Amount: $56,874,094

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA807518D0007

IDV Type: IDC

Timeline