DoD's $38.6M Engineering Services Contract with SAIC Faces Scrutiny for Value and Competition
Contract Overview
Contract Amount: $38,623,976 ($38.6M)
Contractor: Science Applications International Corporation
Awarding Agency: Department of Defense
Start Date: 2015-07-17
End Date: 2021-07-16
Contract Duration: 2,191 days
Daily Burn Rate: $17.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: IGF::OT::IGF NON-PERSONAL ENGINEERING, RESEARCH, DEVELOPMENT, TEST AND EVALUATION (RDT&E), INDUSTRIAL SUPPLY CHAIN MONITORING, PROCUREMENT ANALYSIS (INCLUDING OPERATIONAL PROVISIONING), PROGRAM/PROJECT MANAGEMENT, SYSTEM SAFETY SUPPORT, TEST AND EVALUATION, FAILURE INVESTIGATIONS AND ROOT CAUSE ANALYSIS, REPAIR, REDESIGN, LOW-RATE PRE-PRODUCTION, SUSTAINMENT, TRAINING, BATTERY MAINTENANCE/STORAGE, AND SYSTEM RETIREMENT SUPPORT SERVICES FOR THE ENERGY, POWER AND INTERCONNECT TECHNOLOGIES DIVISION (GXS)
Place of Performance
Location: CRANE, MARTIN County, INDIANA, 47522
State: Indiana Government Spending
Plain-Language Summary
Department of Defense obligated $38.6 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: IGF::OT::IGF NON-PERSONAL ENGINEERING, RESEARCH, DEVELOPMENT, TEST AND EVALUATION (RDT&E), INDUSTRIAL SUPPLY CHAIN MONITORING, PROCUREMENT ANALYSIS (INCLUDING OPERATIONAL PROVISIONING), PROGRAM/PROJECT MANAGEMENT, SYSTEM SAFETY SUPPORT, TEST AND EVALUATION, FAILURE INVESTIGATIONS… Key points: 1. The contract awarded to Science Applications International Corporation (SAIC) for engineering and RDT&E services is substantial, totaling over $38.6 million. 2. Competition was full and open, suggesting a potentially competitive pricing environment. 3. However, the contract's duration (2015-2021) and cost-plus-fixed-fee structure warrant a closer look at cost efficiency and value. 4. The services span a wide range, from RDT&E to sustainment, indicating a broad scope of work for the Navy.
Value Assessment
Rating: fair
The Cost Plus Fixed Fee (CPFF) contract type can lead to higher costs if not managed tightly, as contractor incentives may not always align with cost savings. Benchmarking against similar engineering and RDT&E contracts is crucial to assess if the $38.6 million represents fair value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which generally promotes competitive pricing. However, the specific pricing mechanisms within the CPFF structure and the final negotiated rates are key to understanding the actual price discovery achieved.
Taxpayer Impact: While competition is a positive sign for taxpayer value, the CPFF structure necessitates careful oversight to ensure costs remain reasonable and do not inflate the final expenditure.
Public Impact
Taxpayers may be impacted by the efficiency of the Cost Plus Fixed Fee structure over the contract's six-year duration. The broad scope of engineering and RDT&E services supports critical Navy programs, potentially enhancing national security. The contract's long term suggests a sustained need for these specialized engineering capabilities within the Department of Defense.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee structure
- Long contract duration (6 years)
- Broad scope of services
Positive Signals
- Full and open competition
- Supports critical Navy RDT&E
Sector Analysis
This contract falls within the Engineering Services sector, specifically supporting the Department of Defense's RDT&E and operational needs. Spending in this sector is often characterized by long-term engagements and specialized expertise, with significant government investment.
Small Business Impact
The contract was awarded to Science Applications International Corporation, a large business. There is no indication that small businesses were subcontracted or involved in this specific award, suggesting limited direct benefit to the small business sector from this prime contract.
Oversight & Accountability
The Department of the Navy awarded this contract. Oversight would typically involve program managers monitoring performance, costs, and adherence to contract terms, especially crucial for CPFF contracts to ensure cost reasonableness and prevent overruns.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Potential for cost overruns due to CPFF structure
- Lack of transparency on specific fee negotiation
- Limited direct small business participation
- Long contract duration may reduce flexibility
Tags
engineering-services, department-of-defense, in, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $38.6 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. IGF::OT::IGF NON-PERSONAL ENGINEERING, RESEARCH, DEVELOPMENT, TEST AND EVALUATION (RDT&E), INDUSTRIAL SUPPLY CHAIN MONITORING, PROCUREMENT ANALYSIS (INCLUDING OPERATIONAL PROVISIONING), PROGRAM/PROJECT MANAGEMENT, SYSTEM SAFETY SUPPORT, TEST AND EVALUATION, FAILURE INVESTIGATIONS AND ROOT CAUSE ANALYSIS, REPAIR, REDESIGN, LOW-RATE PRE-PRODUCTION, SUSTAINMENT, TRAINING, BATTERY MAINTENANCE/STORAGE, AND SYSTEM RETIREMENT SUPPORT SERVICES FOR THE ENERGY, POWER AND INTERCONNECT TECHNOLOGIES DIVISION
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 Navy).
What is the total obligated amount?
The obligated amount is $38.6 million.
What is the period of performance?
Start: 2015-07-17. End: 2021-07-16.
What was the final negotiated fixed fee and how did it compare to industry standards for similar CPFF contracts?
The final negotiated fixed fee is a critical component of a CPFF contract's value proposition. Without this specific data, it's difficult to definitively assess the contractor's incentive alignment and the overall fairness of the price. Industry standards for fixed fees typically range from 5% to 15% of the estimated cost, depending on contract complexity and risk.
How effectively were cost controls implemented throughout the contract's lifecycle to manage potential overruns inherent in a CPFF structure?
Effective cost controls in a CPFF contract involve rigorous monitoring of expenditures, regular audits, and proactive management of scope changes. The Department of the Navy's program management team would be responsible for ensuring these controls were in place and actively enforced to prevent cost overruns and maintain fiscal responsibility throughout the contract's six-year term.
Were there any performance metrics or key performance indicators (KPIs) established to measure the effectiveness of the engineering and RDT&E services provided?
Establishing clear KPIs for engineering and RDT&E services is vital for assessing contract effectiveness. These metrics could include technical performance, delivery timelines, innovation achieved, and successful testing outcomes. The presence and tracking of such KPIs would indicate a structured approach to evaluating the value and success of SAIC's contributions beyond just cost management.
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 Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: N0002414R3546
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: $48,022,276
Exercised Options: $48,022,276
Current Obligation: $38,623,976
Subaward Activity
Number of Subawards: 25
Total Subaward Amount: $16,319,994
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
Start Date: 2015-07-17
Current End Date: 2021-07-16
Potential End Date: 2021-07-16 00:00:00
Last Modified: 2024-01-19
More Contracts from Science Applications International Corporation
- Task Order to Provide Project Management Support, Transition Support, Engineering and Design Support, Securing the Infrastructure Support and O&M Support for the Department's IT Consolidation Program — $2.1B (Department of State)
- Software Life Cycle Development — $1.4B (General Services Administration)
- Unified Nasa Information Technology Services (unites) — $1.4B (National Aeronautics and Space Administration)
- THE Scope of the to IS to Provide Enterprise IT Services for the Usace — $1.1B (General Services Administration)
- This Effort IS for a Follow on Procurement Requirement. the Name of This Procurement IS the Omnibus Multidiscipline Engineering Services (omes) II. the Principal Purpose of This Contract IS to Provide Multidiscipline Engineering Support Services and Related Work to EED, Istd, SED, MSD, Mesa, Jpss, Ssco, and Related Organizations, AS Required, for the Study, Design, Systems Engineering, Development, Fabrication, Integration, Testing, Verification, and Operations of Space Flight, Airborne, and Ground System Hardware and Software, Including Development and Validation of NEW Technologies to Enable Future Space and Science Missions. to This END, the Contractor Shall Provide On/Off-Site Multidiscipline Engineering Services, Pursuant to Task Orders Issued by the Contracting Officer. These Services Shall Include the Personnel, Facilities, and Materials (unless Otherwise Provided by the Government) to Accomplish the Tasks. Travel MAY BE Required by the Contractor to Support Certain Task Orders, These Travel Requirements Will BE Identified on a Task by Task Basis — $1.0B (National Aeronautics and Space Administration)
View all Science Applications International Corporation federal contracts →
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)