DoD awards $42.3M engineering services contract to Science Applications International Corp. via full and open competition

Contract Overview

Contract Amount: $42,304,839 ($42.3M)

Contractor: Science Applications International Corporation

Awarding Agency: Department of Defense

Start Date: 2007-09-25

End Date: 2024-01-25

Contract Duration: 5,966 days

Daily Burn Rate: $7.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: NON-PERSONAL ENGINEERING, MANAGEMENT, SCIENTIFIC AND TECHNICAL SUPPORT SERVICES.

Place of Performance

Location: ANDOVER, ESSEX County, MASSACHUSETTS, 01810

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $42.3 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: NON-PERSONAL ENGINEERING, MANAGEMENT, SCIENTIFIC AND TECHNICAL SUPPORT SERVICES. Key points: 1. Contract value of $42.3M for engineering, management, scientific, and technical support. 2. Awarded to Science Applications International Corporation (SAIC) under a full and open competition. 3. Contract duration is substantial at 5966 days (approx. 16 years). 4. The contract type is Cost Plus Fixed Fee (CPFF), which can lead to cost overruns. 5. This falls under the Engineering Services sector (NAICS 541330).

Value Assessment

Rating: fair

The Cost Plus Fixed Fee (CPFF) contract type allows for cost reimbursement plus a fixed fee. While common for complex services, it carries inherent risk of cost escalation compared to fixed-price contracts. Benchmarking CPFF contracts in engineering services is challenging due to variability in scope and overhead.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, suggesting a robust price discovery process. This method typically yields competitive pricing by allowing all eligible offerors to participate. The use of a Delivery Order under a larger contract vehicle (MASSACHUSETTS) implies pre-negotiated terms.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down costs and improve service quality.

Public Impact

Significant taxpayer investment in engineering and technical support services for the Department of Defense. Long-term nature of the contract suggests ongoing critical support requirements. Potential for innovation and efficiency gains through competitive bidding in the engineering sector. The CPFF structure requires diligent oversight to manage costs effectively.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type can incentivize higher costs.
Long contract duration (5966 days) increases exposure to potential scope creep or changing requirements.
Lack of specific performance metrics or benchmarks in the provided data.
No indication of small business participation.

Positive Signals

Awarded via full and open competition, promoting market efficiency.
Contract supports critical Department of Defense needs.
Experienced contractor (SAIC) likely brings significant expertise.

Sector Analysis

This contract falls within the Engineering Services sector, which is crucial for government infrastructure, defense, and technology development. Spending in this sector is often driven by complex project requirements and the need for specialized expertise. Benchmarks vary widely based on the specific engineering discipline and project scale.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (sb: false). There is no specific information on subcontracting opportunities for small businesses within this award.

Oversight & Accountability

The Cost Plus Fixed Fee (CPFF) structure necessitates robust oversight from the Defense Contract Management Agency (DCMA) to ensure costs are reasonable and the fixed fee is earned. Regular audits and performance reviews are critical for accountability on long-term contracts.

Related Government Programs

Engineering Services
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Cost Plus Fixed Fee (CPFF) contract type.
Long contract duration (5966 days).
No specific performance metrics provided.
No indication of small business participation.
Potential for scope creep over the contract's lifespan.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $42.3 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. NON-PERSONAL ENGINEERING, MANAGEMENT, SCIENTIFIC AND TECHNICAL SUPPORT SERVICES.

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $42.3 million.

What is the period of performance?

Start: 2007-09-25. End: 2024-01-25.

What is the typical profit margin for CPFF contracts in engineering services for the DoD?

Profit margins for Cost Plus Fixed Fee (CPFF) contracts in engineering services for the DoD can vary significantly based on contract complexity, risk, and the specific agency's policies. Generally, the fixed fee is negotiated as a percentage of the estimated cost, often ranging from 7% to 15%. However, this fee is intended to cover the contractor's profit and general and administrative expenses, and its actual realization depends on efficient cost management by the contractor.

How does the long duration of this contract impact the risk of cost overruns?

The extended duration of 5966 days (approximately 16 years) significantly increases the risk of cost overruns for a CPFF contract. Over such a long period, requirements can change, inflation can impact labor and material costs, and unforeseen technical challenges may arise. Without strong change control processes and vigilant oversight, the initial cost estimates and fixed fee can become inadequate, leading to budget increases.

What mechanisms are in place to ensure the effectiveness and value delivered by SAIC under this contract?

Effectiveness and value are typically ensured through a combination of contract clauses, performance metrics, and oversight. While not detailed here, the DCMA would likely monitor SAIC's performance against defined objectives, milestones, and quality standards. The CPFF structure itself incentivizes the contractor to complete the work, but the fixed fee is contingent on meeting contractual obligations. Regular progress reviews and technical evaluations are crucial for assessing value.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation ID: N0002407R3428

Offers Received: 1

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: $301,938,964

Exercised Options: $139,067,938

Current Obligation: $42,304,839

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4119

IDV Type: IDC

Timeline