DoD's $27.8M Cyber Command contract awarded to Science Applications International Corporation for R&D services

Contract Overview

Contract Amount: $27,842,788 ($27.8M)

Contractor: Science Applications International Corporation

Awarding Agency: Department of Defense

Start Date: 2023-03-27

End Date: 2024-09-26

Contract Duration: 549 days

Daily Burn Rate: $50.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: JOC/SPS TO2 BRIDGE CONTRACT

Place of Performance

Location: FORT GEORGE G MEADE, ANNE ARUNDEL County, MARYLAND, 20755

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $27.8 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: JOC/SPS TO2 BRIDGE CONTRACT Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, indicating potential for cost overruns. 2. The contract duration of 549 days suggests a significant, ongoing research and development effort. 3. Awarded to a single, large contractor, raising questions about potential lack of competition. 4. The NAICS code 541715 points to research and development in physical, engineering, and life sciences. 5. The contract's value is substantial, requiring careful monitoring of performance and costs. 6. No small business set-aside was utilized, suggesting the primary contractor is a large entity.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without specific deliverables or comparable projects. The cost-plus-fixed-fee structure inherently carries more risk for the government compared to fixed-price contracts, as costs can escalate. While the contractor is a large, established entity, the lack of competitive bidding makes it difficult to assess if the pricing represents fair market value. Further analysis of the fixed fee and projected costs against industry standards for similar R&D efforts would be necessary for a more definitive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning there was no open competition. This typically occurs when a specific contractor possesses unique capabilities or when circumstances prevent a competitive process. The lack of competition means the government did not benefit from the price discovery that typically occurs in a multi-bidder environment, potentially leading to higher costs than if multiple firms had competed.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure to drive down costs. The government's negotiating position is also weakened without alternative offers.

Public Impact

The primary beneficiary is the U.S. Cyber Command, receiving critical research and development support. Services delivered are focused on advancing capabilities within the physical, engineering, and life sciences relevant to cyber operations. The geographic impact is primarily within the United States, supporting national security objectives. Workforce implications include employment for specialized researchers and technical personnel at the contractor's facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially increasing costs for taxpayers.
Cost-plus-fixed-fee contract type introduces risk of cost overruns if not closely managed.
Lack of transparency in the sole-source justification requires scrutiny.
The specific R&D outcomes and their alignment with Cyber Command's strategic goals need clear definition and tracking.

Positive Signals

Award to a large, established contractor like Science Applications International Corporation suggests access to significant expertise and resources.
The contract duration indicates a commitment to a potentially critical, long-term R&D initiative.
Focus on R&D in cyber-related fields aligns with evolving national security needs.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The market for R&D services supporting defense and intelligence agencies is substantial, with significant government investment. Comparable spending benchmarks are difficult to establish without knowing the precise nature of the R&D, but contracts of this magnitude often involve specialized scientific and technical expertise. The award to SAIC positions them as a key provider of advanced research capabilities for U.S. Cyber Command.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. The award to a large prime contractor suggests that the focus is on leveraging the prime's extensive capabilities, potentially limiting direct opportunities for small businesses on this specific contract. However, the prime contractor may engage small businesses for specialized support not covered by the main contract.

Oversight & Accountability

Oversight for this contract would typically fall under the U.S. Cyber Command's contracting and program management offices. As a cost-plus-fixed-fee contract, rigorous financial oversight and auditing are crucial to ensure costs are reasonable and allocable. Transparency regarding the justification for the sole-source award and the progress of the R&D efforts would be key accountability measures. Inspector General involvement would be likely if significant issues or allegations of fraud arise.

Related Government Programs

Cybersecurity Research and Development Programs
Department of Defense Advanced Research Projects Agency (DARPA) Contracts
Intelligence Community Research Initiatives
Information Technology Research and Development
National Security Science and Technology Investments

Risk Flags

Sole-source award
Cost-plus-fixed-fee contract type
Lack of small business participation noted

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.8 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. JOC/SPS TO2 BRIDGE CONTRACT

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 (U.S. Cyber Command).

What is the total obligated amount?

The obligated amount is $27.8 million.

What is the period of performance?

Start: 2023-03-27. End: 2024-09-26.

What specific research and development objectives does this contract aim to achieve for U.S. Cyber Command?

The contract data indicates the research and development falls under NAICS code 541715, 'Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)'. For U.S. Cyber Command, this likely translates to R&D efforts aimed at enhancing cyber defense capabilities, developing new offensive cyber tools, improving threat intelligence analysis, advancing secure network architectures, and exploring novel methods for protecting critical infrastructure from cyber threats. The specific objectives would be detailed in the contract's Statement of Work (SOW), which is not publicly available in this data snippet. These objectives are crucial for maintaining a technological advantage in the cyber domain.

How does the cost-plus-fixed-fee (CPFF) structure compare to other contract types for R&D, and what are the implications for cost control?

The Cost-Plus-Fixed-Fee (CPFF) contract type is common for R&D where the scope of work is not fully defined at the outset, making fixed-price contracts impractical. In a CPFF contract, the contractor is reimbursed for allowable costs plus a predetermined fixed fee representing profit. This structure incentivizes the contractor to control costs to maximize their profit margin, as the fee is fixed regardless of the final cost. However, it places a significant burden on the government to meticulously audit costs to ensure they are reasonable, allocable, and allowable. Compared to fixed-price contracts, CPFF offers more flexibility for evolving R&D but carries a higher risk of cost overruns if oversight is insufficient. Other R&D contract types include Cost-Plus-Incentive-Fee (CPIF), which adds performance incentives, and Cost-Sharing contracts, where the contractor bears a portion of the cost.

What is the typical track record of Science Applications International Corporation (SAIC) in performing similar R&D contracts for the Department of Defense?

Science Applications International Corporation (SAIC) is a major government contractor with extensive experience in providing research, development, and engineering services across various defense and intelligence agencies. They have a long history of performing complex R&D projects, including those related to cybersecurity, command and control systems, intelligence analysis, and advanced technologies. SAIC typically manages large, multi-year contracts and possesses the infrastructure and personnel to handle significant R&D efforts. While specific performance metrics for individual contracts are often not public, SAIC's continued success in winning large, sole-source, and competitive contracts suggests a generally positive track record in delivering on its contractual obligations for the DoD. However, like any large contractor, past performance reviews and any past issues would need to be examined for a complete picture.

Given the sole-source nature, what mechanisms are in place to ensure fair pricing and prevent contractor overcharging?

In sole-source procurements, ensuring fair pricing relies heavily on robust government oversight and negotiation. The government must conduct thorough price analyses, often involving detailed cost breakdowns from the contractor, comparison with historical pricing for similar services, and market research to establish fair market value. For CPFF contracts, this includes scrutinizing the proposed costs (labor, materials, overhead) and the fixed fee. The Defense Contract Audit Agency (DCAA) often plays a critical role in auditing the contractor's cost proposals. Furthermore, the government contracting officer must negotiate the best possible price based on the available data. Without competition, the government's ability to achieve the lowest possible price is diminished, making diligent price analysis and negotiation paramount.

What are the potential risks associated with awarding a significant R&D contract on a sole-source basis to a single contractor?

The primary risk of a sole-source award is the lack of competitive pressure, which can lead to inflated prices and reduced innovation. Without competing bids, the government may not achieve the most cost-effective solution. There's also a risk of vendor lock-in, where the government becomes overly reliant on a single provider, making it difficult to switch or introduce new technologies. Furthermore, a sole-source award might indicate a lack of available qualified sources or a failure in the government's acquisition planning to foster a competitive environment. This can stifle market growth and limit the government's access to a broader range of solutions and expertise in the long run.

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: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: HB000123R1004

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 12010 SUNSET HILLS ROAD, 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: $35,115,047

Exercised Options: $35,103,047

Current Obligation: $27,842,788

Actual Outlays: $11,428,412

Subaward Activity

Number of Subawards: 14

Total Subaward Amount: $10,568,476

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline