DoD awards $18.9M contract for space operations software, with a 5-year performance period

Contract Overview

Contract Amount: $18,875,968 ($18.9M)

Contractor: Tech7 Consulting, LLC

Awarding Agency: Department of Defense

Start Date: 2023-09-27

End Date: 2027-11-26

Contract Duration: 1,521 days

Daily Burn Rate: $12.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: AGILE USSF SPACE OPERATIONS SOFTWARE APPLICATIONS FOR MULTI-DOMAIN OPERATIONS (SOPSSW)

Place of Performance

Location: MONUMENT, EL PASO County, COLORADO, 80132

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $18.9 million to TECH7 CONSULTING, LLC for work described as: AGILE USSF SPACE OPERATIONS SOFTWARE APPLICATIONS FOR MULTI-DOMAIN OPERATIONS (SOPSSW) Key points: 1. Contract awarded to TECH7 CONSULTING, LLC for research and development in physical sciences. 2. The contract has a total value of $18.9 million over its duration. 3. Performance period spans over 4 years, from September 2023 to November 2027. 4. This contract falls under the Research and Development in the Physical, Engineering, and Life Sciences NAICS code. 5. The contract type is Cost Plus Fixed Fee, indicating potential for cost overruns. 6. Awarded under full and open competition, suggesting a competitive bidding process.

Value Assessment

Rating: fair

The contract value of $18.9 million for R&D in space operations software appears moderate for a 4-year period. Benchmarking against similar contracts is difficult without more specific details on the scope of work and deliverables. The Cost Plus Fixed Fee (CPFF) contract type suggests that costs are reimbursed, plus a fixed fee for profit, which can sometimes lead to higher overall costs compared to fixed-price contracts if not managed tightly. However, CPFF is often used for R&D where the scope is not fully defined at the outset.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The data shows 2 bids were received, which suggests a moderate level of competition for this specific R&D effort. While competition is present, a higher number of bidders could potentially drive prices lower and encourage more innovative solutions.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the best value through a competitive process, potentially leading to more cost-effective solutions.

Public Impact

The primary beneficiaries are the Department of Defense and the U.S. Space Force, who will receive advanced software applications for space operations. The services delivered will enhance multi-domain operations capabilities. The geographic impact is likely national, supporting U.S. space defense infrastructure. Workforce implications may include specialized software developers and engineers, potentially creating or sustaining high-skilled jobs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type may lead to cost overruns if not closely monitored.
Limited competition (2 bidders) might not have yielded the absolute lowest price.
The specific deliverables and success metrics for the R&D are not detailed, posing a risk to performance evaluation.

Positive Signals

Awarded under full and open competition, ensuring a broad search for qualified contractors.
The contractor, TECH7 CONSULTING, LLC, is likely selected based on demonstrated capabilities in R&D.
The contract duration of over 4 years allows for sustained development and integration of complex software.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on software applications for space operations. The market for defense-related R&D is highly specialized, with significant government investment. Comparable spending benchmarks are difficult to establish without knowing the precise technological advancements sought, but R&D contracts of this magnitude are common within the defense industry for developing cutting-edge capabilities.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside. The primary contractor, TECH7 CONSULTING, LLC, is likely a mid-to-large-sized entity given the contract value. The impact on the broader small business ecosystem would depend on whether TECH7 CONSULTING, LLC voluntarily engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Air Force, under the purview of the Department of Defense. Accountability measures will be tied to the Cost Plus Fixed Fee structure, requiring detailed cost reporting and performance metrics. Transparency will be facilitated through contract award databases and potentially through reporting requirements within the contract itself. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Space Operations Software Development
DoD Research and Development Programs
Multi-Domain Operations Technologies
Air Force Software Acquisition

Risk Flags

Cost Overrun Risk (CPFF)
Limited Competition
Uncertain R&D Outcomes

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $18.9 million to TECH7 CONSULTING, LLC. AGILE USSF SPACE OPERATIONS SOFTWARE APPLICATIONS FOR MULTI-DOMAIN OPERATIONS (SOPSSW)

Who is the contractor on this award?

The obligated recipient is TECH7 CONSULTING, 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 $18.9 million.

What is the period of performance?

Start: 2023-09-27. End: 2027-11-26.

What is the track record of TECH7 CONSULTING, LLC with government contracts, particularly in R&D and space operations?

A review of federal procurement data would be necessary to fully assess TECH7 CONSULTING, LLC's track record. Key metrics to examine would include the number of previous contracts awarded, their total value, the agencies they have served, and their performance ratings on past projects. Specifically, identifying prior R&D contracts, especially those related to software development for defense or space applications, would provide crucial context. Understanding their history with Cost Plus Fixed Fee contracts and their ability to manage costs effectively would also be important. Without this specific data, it's difficult to definitively assess their suitability and past performance beyond the current award.

How does the $18.9 million value compare to similar R&D contracts for space operations software?

Determining if $18.9 million is a typical value requires benchmarking against comparable contracts. This involves identifying other DoD or agency contracts for the development of space operations software, particularly those with similar scope, complexity, and duration (approximately 4 years). Factors such as the specific technologies involved (e.g., AI, cybersecurity, data analytics for space), the number of bidders, and the contract type (e.g., CPFF, FFP) influence pricing. If similar contracts for comparable R&D efforts are consistently valued higher or lower, it could indicate that this award is either a good deal or potentially overpriced. A detailed market analysis would be needed to provide a precise comparison.

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

The primary risk with a CPFF contract, especially in R&D, is the potential for cost overruns. While the contractor receives a fixed fee, the government reimburses all allowable costs. If the R&D effort proves more complex or time-consuming than initially estimated, the total cost to the government can escalate significantly beyond initial projections. This necessitates robust oversight and rigorous cost tracking by the procuring agency to ensure that expenditures are reasonable and allocable to the contract's objectives. For R&D, where the path to success is often uncertain, CPFF can be appropriate for exploring innovative solutions, but it places a premium on the government's ability to manage and control costs effectively throughout the contract's lifecycle.

What are the key performance indicators (KPIs) likely to be used to measure the success of this software development contract?

Key performance indicators (KPIs) for this contract would likely focus on both technical performance and project management. Technical KPIs could include software functionality meeting specified requirements, system reliability and uptime, integration success with existing platforms, cybersecurity robustness, and performance benchmarks (e.g., processing speed, data throughput). Project management KPIs would involve adherence to schedule milestones, effective budget management (especially crucial for CPFF), quality of deliverables, and responsiveness to government feedback. The specific KPIs would be detailed in the contract's Performance Work Statement (PWS) and would be essential for evaluating TECH7 CONSULTING, LLC's progress and overall success.

How has spending on space operations software R&D evolved within the Department of Defense over the past five years?

Analyzing historical spending trends for space operations software R&D within the DoD over the past five years would reveal patterns of investment and evolving priorities. This would involve aggregating data from similar contracts and programs to identify growth or decline in funding. Factors influencing these trends could include geopolitical shifts, technological advancements (e.g., advancements in satellite technology, AI for space situational awareness), and strategic directives like the focus on multi-domain operations. Understanding this historical context helps in evaluating whether the current $18.9 million award aligns with broader spending patterns and strategic investments in this critical area.

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: BASIC RESEARCH

Solicitation ID: FA875021S7004

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 705 WINDING HILLS RD, MONUMENT, CO, 80132

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Hispanic American Owned Business, Limited Liability Corporation, Minority Owned Business, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $25,425,342

Exercised Options: $25,425,342

Current Obligation: $18,875,968

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline