DoD's $49.7M EDIS contract to SAIC shows strong competition and R&D focus

Contract Overview

Contract Amount: $49,699,834 ($49.7M)

Contractor: Science Applications International Corporation

Awarding Agency: Department of Defense

Start Date: 2020-07-07

End Date: 2024-06-30

Contract Duration: 1,454 days

Daily Burn Rate: $34.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS AWARD FEE

Sector: R&D

Official Description: ENGINEERING, DEVELOPMENT, INTEGRATION, SUSTAINMENT, (EDIS) POST-LEO LAUNCH TO

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $49.7 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: ENGINEERING, DEVELOPMENT, INTEGRATION, SUSTAINMENT, (EDIS) POST-LEO LAUNCH TO Key points: 1. Contract awarded through full and open competition, suggesting a competitive market. 2. Focus on R&D aligns with critical national security and scientific advancement goals. 3. The contract's duration of over 4 years indicates a long-term need for these services. 4. SAIC's role as a prime contractor highlights its significant capabilities in engineering and integration. 5. The Cost Plus Award Fee (CPAF) structure incentivizes performance and cost control. 6. The contract is categorized under Research and Development, a key area for technological progress.

Value Assessment

Rating: good

The contract's total value of $49.7 million over approximately four years suggests a moderate investment in specialized engineering and development services. Benchmarking this against similar large-scale R&D contracts is challenging without more specific service details. However, the Cost Plus Award Fee (CPAF) structure, while common for complex R&D, requires careful oversight to ensure value for money. The pricing is likely competitive given the full and open competition, but detailed cost breakdowns would be needed for a definitive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which can lead to better pricing and innovation. The agency's decision to use full and open competition suggests confidence in the market's ability to provide the required specialized services.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that is expected to drive down costs and ensure the government receives the best possible value for its investment in advanced engineering and development.

Public Impact

The primary beneficiaries are the Department of Defense and its various branches, receiving critical engineering, development, integration, and sustainment services. This contract supports the advancement of technologies and systems essential for national security and scientific research. The services delivered are likely to have a broad geographic impact, supporting defense operations and research initiatives across various locations. The contract supports a skilled workforce in engineering, research, and development, contributing to the technological capabilities of the nation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Award Fee (CPAF) contracts if not rigorously managed.
Complexity of R&D projects can lead to scope creep and schedule delays.
Dependence on a single contractor (SAIC) for critical EDIS services could pose a risk if performance falters.

Positive Signals

Awarded through full and open competition, indicating a robust market and potential for competitive pricing.
SAIC is a well-established contractor with a proven track record in defense and technology sectors.
The CPAF structure incentivizes contractor performance and cost efficiency, aligning contractor goals with government objectives.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. This is a critical area for the Department of Defense, driving innovation in areas like advanced materials, propulsion, electronics, and systems integration. The market for such specialized R&D services is competitive, with major defense contractors and specialized research firms vying for these high-value awards. Spending in this category is substantial across the federal government, reflecting a continuous need for technological superiority.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large prime contract awarded to Science Applications International Corporation (SAIC), it is likely that small businesses may participate as subcontractors. However, without specific subcontracting plans or goals detailed in the award, the direct impact on the small business ecosystem is unclear. Further analysis would be needed to determine the extent of small business involvement.

Oversight & Accountability

Oversight for this Cost Plus Award Fee (CPAF) contract would typically be managed by the contracting officer and their representatives within the Department of the Air Force. Performance metrics and award fee criteria are crucial for ensuring accountability. Transparency is generally maintained through contract award databases, though detailed performance reports are often internal. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Defense Research and Development
Engineering and Technical Services
Systems Integration
Space Launch Support Services
Advanced Technology Development

Risk Flags

Potential for cost overruns in CPAF structure.
Complexity of R&D projects leading to schedule delays.
Need for robust oversight to ensure performance metrics are met.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $49.7 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. ENGINEERING, DEVELOPMENT, INTEGRATION, SUSTAINMENT, (EDIS) POST-LEO LAUNCH TO

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 $49.7 million.

What is the period of performance?

Start: 2020-07-07. End: 2024-06-30.

What is Science Applications International Corporation's (SAIC) track record with similar large-scale R&D contracts for the Department of Defense?

Science Applications International Corporation (SAIC) has a substantial track record with the Department of Defense (DoD) and other federal agencies, frequently securing large prime contracts for complex engineering, IT, and R&D services. Their history includes numerous awards for systems engineering, integration, sustainment, and research across various defense platforms and domains. SAIC is known for its ability to manage large, multi-faceted programs. While specific performance metrics for past R&D contracts are not publicly detailed in this award, their consistent selection as a prime contractor for significant DoD initiatives suggests a generally positive performance history and capability to meet demanding technical requirements. However, like any large contractor, they may have faced scrutiny or challenges on specific projects, which would require deeper investigation into individual contract performance reports.

How does the $49.7 million value of this EDIS contract compare to other similar R&D contracts awarded by the Air Force or DoD?

The $49.7 million total value for this Engineering, Development, Integration, and Sustainment (EDIS) contract, spanning approximately four years, positions it as a moderately sized award within the broader DoD R&D landscape. The Air Force and other DoD branches frequently award R&D contracts ranging from tens of millions to billions of dollars, depending on the scope and criticality of the research. For instance, major platform development or advanced technology research programs can easily exceed hundreds of millions or even billions. This particular contract's value suggests a focused effort on specific engineering and development tasks rather than a comprehensive platform overhaul. It is competitive within its niche but not among the largest R&D investments made by the DoD.

What are the primary risks associated with a Cost Plus Award Fee (CPAF) contract structure for R&D services?

Cost Plus Award Fee (CPAF) contracts, while incentivizing performance, carry inherent risks, particularly in R&D. A primary risk is the potential for cost overruns, as the contractor is reimbursed for allowable costs plus a fee that includes a base amount and an award amount tied to performance. If performance targets are not clearly defined or if oversight is lax, costs can escalate beyond initial projections. Another risk is 'scope creep,' where project requirements evolve or expand without adequate adjustments to cost and schedule, potentially driven by the pursuit of award fees. Furthermore, the contractor might prioritize activities that maximize the award fee, potentially at the expense of other critical, albeit less fee-generating, aspects of the project. Rigorous monitoring of expenditures, clear performance metrics, and strong program management are essential to mitigate these risks.

How effective is the 'full and open competition' procurement method in ensuring value for money for taxpayers in the R&D sector?

Full and open competition is generally considered the most effective method for ensuring value for money for taxpayers, especially in sectors like R&D where innovation and cost-efficiency are paramount. By allowing all responsible sources to submit bids, it maximizes the pool of potential offerors, thereby increasing the likelihood of receiving competitive pricing and innovative technical solutions. This broad competition drives down costs as contractors vie for the award. In the R&D context, it encourages companies to propose novel approaches and efficient methodologies to win contracts. While the Cost Plus Award Fee (CPAF) structure requires careful management, the initial competitive bidding process under full and open competition sets a strong foundation for achieving favorable outcomes and ensuring that taxpayer funds are used judiciously to acquire cutting-edge capabilities.

What are the implications of the NAICS code 541715 (Physical, Engineering, and Life Sciences R&D) for the type of services being procured?

The North American Industry Classification System (NAICS) code 541715 signifies that this contract is for Research and Development in the Physical, Engineering, and Life Sciences, excluding Nanotechnology and Biotechnology. This classification indicates that the services procured are highly specialized and focused on scientific inquiry and technological advancement. It suggests the contract involves activities such as basic and applied research, experimental development, and the creation of new or improved products, processes, or services within these scientific domains. This could encompass areas like aerospace engineering, materials science, advanced manufacturing processes, energy systems research, or complex simulation and modeling. The R&D focus implies a degree of uncertainty and innovation, requiring contractors with deep technical expertise and the ability to navigate complex scientific challenges.

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: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS AWARD FEE (R)

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: $64,835,896

Exercised Options: $64,835,796

Current Obligation: $49,699,834

Actual Outlays: $69,807

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $1,527,800

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA881820D0009

IDV Type: IDC

Timeline