DoD's $12.4M Engineering Services Contract Awarded to BAE Systems for Depot Maintenance

Contract Overview

Contract Amount: $12,397,796 ($12.4M)

Contractor: BAE Systems Technology Solutions & Services Inc.

Awarding Agency: Department of Defense

Start Date: 2006-01-10

End Date: 2011-04-04

Contract Duration: 1,910 days

Daily Burn Rate: $6.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: DEPOT-MAINTENANCE

Place of Performance

Location: KEYPORT, KITSAP County, WASHINGTON, 98345

State: Washington Government Spending

Plain-Language Summary

Department of Defense obligated $12.4 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. for work described as: DEPOT-MAINTENANCE Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract duration of 1910 days indicates a long-term need for these services. 3. The 'Cost Plus Fixed Fee' pricing structure can present cost control challenges. 4. The specific NAICS code (541330) points to a focus on engineering services. 5. The contract was awarded by the Department of the Navy, a major DoD component. 6. No small business set-aside was utilized, potentially limiting small business participation.

Value Assessment

Rating: fair

Benchmarking the value of this $12.4 million contract is challenging without more specific details on the scope of 'Depot Maintenance' engineering services. However, for long-term engineering support contracts within the Department of Defense, this amount falls within a typical range. The 'Cost Plus Fixed Fee' (CPFF) contract type, while common, requires careful oversight to ensure costs remain controlled and that the fixed fee remains reasonable for the effort involved. Without comparable contract data for similar depot maintenance engineering services, a definitive value-for-money assessment is difficult.

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 bids. The presence of only one award (no=1) suggests that while the competition was open, only one bid was selected, or perhaps only one bid was deemed responsive and responsible. The level of competition, while open, doesn't inherently guarantee the best price without knowing the number of bids received and the spread of pricing.

Taxpayer Impact: A full and open competition process is generally favorable for taxpayers as it aims to solicit the widest range of offers, potentially leading to more competitive pricing and better value. However, the ultimate benefit depends on the number of bids submitted and the effectiveness of the evaluation process.

Public Impact

This contract supports depot maintenance operations for the Department of the Navy, ensuring readiness of naval assets. Engineering services provided likely contribute to the upkeep, repair, and modernization of military equipment and facilities. The contract's impact is primarily within the defense sector, supporting military readiness and operational capabilities. Workforce implications may include employment for engineers, technicians, and support staff involved in maintenance and engineering.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contracts can lead to cost overruns if not managed diligently.
Limited transparency on the specific engineering tasks and deliverables makes it hard to assess performance.
The long duration (1910 days) increases the risk of scope creep or changing requirements impacting cost and schedule.
Lack of small business participation may limit opportunities for smaller, specialized firms.

Positive Signals

Awarded through full and open competition, which theoretically promotes competitive pricing.
The contract addresses a critical need for depot maintenance engineering services within the Navy.
BAE Systems is a large, established defense contractor with significant experience in engineering services.

Sector Analysis

The engineering services sector within the defense industry is substantial, encompassing a wide range of activities from design and development to maintenance and lifecycle support. This contract falls under the broader category of professional, scientific, and technical services, specifically engineering services (NAICS 541330). Spending in this area is critical for maintaining the operational readiness of military platforms and infrastructure. Comparable spending benchmarks would typically be found within large-scale sustainment and maintenance contracts for naval vessels, aircraft, or ground systems.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting requirements for small businesses indicated in the provided data (sb=false). This means that opportunities for small businesses to directly participate in this contract are limited unless they are subcontractors to the prime contractor, BAE Systems. The absence of set-asides can sometimes mean larger contracts are consolidated, potentially reducing the overall ecosystem of small business involvement in major defense procurements.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures are inherent in the 'Cost Plus Fixed Fee' structure, requiring the contractor to justify costs against the agreed-upon fixed fee. Transparency is often managed through contract reporting requirements and performance reviews. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Depot Maintenance Programs
Naval Sea Systems Command (NAVSEA) Contracts
Engineering and Technical Services Contracts
Defense Logistics Agency (DLA) Support Contracts

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage costs.
Limited data on the number of bidders received hinders a full assessment of competition.
Scope definition for 'Depot Maintenance' engineering services could be more granular.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.4 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC.. DEPOT-MAINTENANCE

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $12.4 million.

What is the period of performance?

Start: 2006-01-10. End: 2011-04-04.

What specific depot maintenance engineering services does this contract cover, and how do they align with the Navy's operational needs?

The provided data indicates the contract is for 'Depot Maintenance' and falls under 'Engineering Services' (NAICS 541330). Depot maintenance typically involves the overhaul, repair, and modernization of major weapon systems, equipment, and components. For the Department of the Navy, this could encompass a wide range of services such as structural repair, systems engineering for upgrades, diagnostic testing, and lifecycle support for naval vessels, aircraft, or associated equipment. The alignment with operational needs would be through ensuring these critical assets are maintained in a state of readiness for deployment and mission accomplishment. Without more granular detail on the Statement of Work (SOW), the precise alignment remains general.

How does the 'Cost Plus Fixed Fee' (CPFF) pricing structure compare to other contract types for similar engineering services, and what are the associated risks?

The CPFF structure is common for complex engineering and R&D efforts where the scope is not fully defined at the outset, or where innovation is required. In a CPFF contract, the contractor is reimbursed for allowable costs plus a predetermined fixed fee representing profit. This differs from Fixed Price contracts, where the contractor bears more risk for cost overruns, and Cost Plus Incentive Fee (CPIF) contracts, which offer incentives for meeting cost or performance targets. The primary risk with CPFF for the government is the potential for cost escalation, as the contractor has less financial incentive to control costs beyond what is necessary to complete the work. Robust government oversight and detailed cost tracking are crucial to mitigate this risk and ensure fair value.

What was the competitive landscape for this $12.4 million engineering services contract, and how many bids were received?

The contract was awarded under 'Full and Open Competition,' meaning all responsible sources were encouraged to bid. However, the provided data indicates only one award was made ('no': 1). This single award does not reveal the number of bids received; it only signifies that one contract was ultimately chosen. A competitive landscape analysis would require knowing how many proposals were submitted, how many were deemed technically acceptable, and the range of pricing offered. Without this information, it's impossible to definitively assess the competitiveness of the bidding process beyond the initial openness.

What is BAE Systems Technology Solutions & Services Inc.'s track record with similar Department of Defense engineering and depot maintenance contracts?

BAE Systems is a major defense contractor with extensive experience in providing engineering, technology, and support services across various branches of the U.S. military, including the Department of Defense. Their portfolio often includes large-scale sustainment, maintenance, and modernization programs for complex defense systems. While specific details on their track record for 'Depot Maintenance' engineering services for the Navy would require a deeper dive into contract databases and performance reviews, BAE Systems generally possesses the scale and expertise to handle such requirements. Their history includes numerous contracts involving complex engineering challenges and long-term support, suggesting a capacity to manage contracts like this one.

How does the $12.4 million contract value compare to historical spending on similar engineering services for Navy depot maintenance?

Assessing the $12.4 million contract value against historical spending requires context on the specific services rendered and the duration. For a multi-year contract (1910 days, approximately 5.2 years), this annual average is around $2.4 million. This figure appears moderate for specialized engineering support within depot maintenance, especially considering the complexity of naval systems. Historical spending on similar contracts can vary significantly based on the platform (e.g., aircraft carrier vs. submarine vs. aircraft), the scope of work (e.g., routine maintenance vs. major overhaul/upgrade), and prevailing market rates. Without specific comparable contract data points, it's difficult to definitively state if this represents high or low spending, but it falls within a plausible range for specialized engineering support.

Industry Classification

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

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002405R3330

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC (UEI: 217304393)

Address: 520 GAITHER ROAD, ROCKVILLE, MD, 20850

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4018

IDV Type: IDC

Timeline