DoD's $7.6M custom programming contract awarded to Sierra Nevada Company, LLC for specialized IT services

Contract Overview

Contract Amount: $7,611,656 ($7.6M)

Contractor: Sierra Nevada Company, LLC

Awarding Agency: Department of Defense

Start Date: 2023-07-24

End Date: 2026-09-30

Contract Duration: 1,164 days

Daily Burn Rate: $6.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: LABOR

Place of Performance

Location: ENGLEWOOD, DENVER County, COLORADO, 80112

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $7.6 million to SIERRA NEVADA COMPANY, LLC for work described as: LABOR Key points: 1. Contract awarded on a sole-source basis, limiting potential cost savings from competition. 2. Significant duration of 1164 days suggests a complex, long-term project. 3. Cost-plus-fixed-fee contract type may incentivize cost overruns. 4. Focus on custom computer programming indicates a need for specialized technical expertise. 5. Awarded by U.S. Special Operations Command, implying sensitive or critical operational support. 6. No small business set-aside, potentially excluding smaller specialized firms.

Value Assessment

Rating: questionable

Benchmarking the value of this $7.6 million contract is challenging without more detailed cost breakdowns and performance metrics. The cost-plus-fixed-fee structure, while common for R&D or uncertain scope projects, can lead to higher overall costs compared to fixed-price contracts if not managed tightly. Comparing it to similar custom programming services for special operations would require access to proprietary data, but the lack of competition suggests potential for less favorable pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This typically occurs when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The lack of competition limits the government's ability to leverage market forces to achieve the best possible price and terms.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from competitive pricing, potentially leading to higher expenditures for the same services.

Public Impact

The U.S. Special Operations Command benefits from specialized custom computer programming services. This contract supports critical operational capabilities for special operations forces. The geographic impact is primarily within Colorado, where the contractor is located. The contract likely involves highly skilled IT professionals, impacting the specialized tech workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Cost-plus-fixed-fee contract type carries inherent risk of cost escalation.
Lack of transparency on specific deliverables and performance metrics hinders full assessment.
No indication of small business participation or subcontracting opportunities.

Positive Signals

Award to an established entity (Sierra Nevada Company) may indicate reliability.
Long contract duration suggests a sustained need and potential for stable support.
Focus on custom programming addresses unique, potentially mission-critical requirements.

Sector Analysis

This contract falls within the Information Technology sector, specifically custom computer programming services. The market for such services is vast and highly competitive, with numerous firms offering specialized development. However, for highly specialized or classified needs, particularly within defense, sole-source awards to contractors with proven track records and security clearances are not uncommon. The $7.6 million value is moderate for custom IT development supporting a major federal agency.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements. This means that opportunities for small businesses to participate in this specific contract are likely limited. While Sierra Nevada Company may utilize small business subcontractors, the primary award does not prioritize small business engagement, potentially impacting the small business ecosystem's access to this particular federal spending.

Oversight & Accountability

Oversight mechanisms for this contract would typically be managed by the U.S. Special Operations Command's contracting officers and program managers. Accountability measures would be tied to the terms of the Cost Plus Fixed Fee contract, requiring detailed reporting and adherence to milestones. Transparency is limited due to the sole-source nature and potential classification of the services, but standard contract administration processes should be in place.

Related Government Programs

Special Operations Forces Support Contracts
Custom Software Development Services
Department of Defense IT Procurement
Information Technology Services

Risk Flags

Sole-source award may limit price competition.
Cost-plus-fixed-fee contract type can increase cost risk.
Lack of small business set-aside.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $7.6 million to SIERRA NEVADA COMPANY, LLC. LABOR

Who is the contractor on this award?

The obligated recipient is SIERRA NEVADA COMPANY, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (U.S. Special Operations Command).

What is the total obligated amount?

The obligated amount is $7.6 million.

What is the period of performance?

Start: 2023-07-24. End: 2026-09-30.

What is Sierra Nevada Company's track record with the Department of Defense, particularly for custom programming services?

Sierra Nevada Company, LLC, a subsidiary of Textron Systems, has a significant history of contracting with the Department of Defense across various capabilities, including aerospace, defense electronics, and information technology. While specific details on their custom programming services for U.S. Special Operations Command (SOCOM) under this particular award are not publicly detailed, their broader portfolio suggests experience in developing complex, mission-critical systems. Past performance reviews and contract awards data from federal procurement databases would provide a more granular understanding of their specific track record in delivering custom software solutions, including adherence to schedule, cost, and technical requirements for similar defense-related projects.

How does the $7.6 million value compare to similar custom programming contracts for special operations?

Direct comparison of this $7.6 million contract value for custom programming services to similar contracts within U.S. Special Operations Command (SOCOM) is difficult without access to proprietary SOCOM spending data and detailed scopes of work. However, for specialized IT development supporting unique operational requirements, this value is within a common range. Contracts for custom software can vary widely based on complexity, duration, security requirements, and the level of expertise needed. Given the sole-source nature and the specialized domain of special operations, the pricing may reflect unique capabilities rather than broad market rates. Benchmarking would ideally involve comparing it to other sole-source or limited-competition awards for similar niche IT services within defense agencies.

What are the primary risks associated with a sole-source, cost-plus-fixed-fee contract for custom programming?

The primary risks associated with a sole-source, cost-plus-fixed-fee (CPFF) contract for custom programming are twofold. Firstly, the sole-source nature eliminates competitive pressure, potentially leading to higher costs than if the contract were competed. The government may not achieve the best possible price. Secondly, the CPFF structure, while providing flexibility for evolving requirements, carries the risk of cost overruns. The contractor is reimbursed for allowable costs plus a fixed fee, which can incentivize less stringent cost control if not meticulously overseen. For custom programming, where the scope can be inherently uncertain, this combination requires robust government oversight to manage expenditures effectively and ensure value for taxpayer money.

What is the expected program effectiveness given the contract details?

The expected program effectiveness hinges on the contractor's ability to deliver the specified custom computer programming services to meet the unique needs of U.S. Special Operations Command (SOCOM). The contract's duration (over three years) suggests a significant undertaking, implying a need for sustained development and support. Effectiveness will be measured by how well the delivered software enhances SOCOM's operational capabilities, improves efficiency, or provides critical functionalities. Given the sole-source award and CPFF structure, effective program management and rigorous oversight by SOCOM are crucial to ensure the developed solutions are not only technically sound but also delivered within reasonable cost parameters and meet the evolving demands of special operations.

What are the historical spending patterns for custom computer programming services by U.S. Special Operations Command?

Historical spending patterns for custom computer programming services by U.S. Special Operations Command (SOCOM) indicate a consistent need for specialized IT solutions to support unique operational requirements. SOCOM frequently procures advanced technological capabilities, including software development, to maintain a strategic advantage. While specific aggregate data for 'custom computer programming services' alone is not readily available in public summaries, SOCOM's overall IT and services procurement budgets are substantial. Trends often show a mix of competitive and sole-source awards, with sole-source being more common for highly specialized or classified systems where only a few contractors possess the requisite expertise and security clearances. The value of individual contracts can range significantly, from hundreds of thousands to tens of millions of dollars, depending on project scope and complexity.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Sierra Nevada Corporation

Address: 444 SALOMON CIR, SPARKS, NV, 89434

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $7,611,656

Exercised Options: $7,611,656

Current Obligation: $7,611,656

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $110,044

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: H9240821D0004

IDV Type: IDC

Timeline