DoD's $18.3M Counter-WMD ISR SE&I contract awarded to Leidos, Inc. shows strong competition
Contract Overview
Contract Amount: $18,336,268 ($18.3M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2019-05-01
End Date: 2025-12-02
Contract Duration: 2,407 days
Daily Burn Rate: $7.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: COUNTER WEAPONS OF MASS DESTRUCTION INTELLIGENCE, SURVEILLANCE, AND RECONNAISSANCE TEAM SYSTEM ENGINEERING AND INTEGRATION (SE&I) SUPPORT
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $18.3 million to LEIDOS, INC. for work described as: COUNTER WEAPONS OF MASS DESTRUCTION INTELLIGENCE, SURVEILLANCE, AND RECONNAISSANCE TEAM SYSTEM ENGINEERING AND INTEGRATION (SE&I) SUPPORT Key points: 1. The contract value of $18.3M over approximately 2407 days suggests a moderate annual spend. 2. Full and open competition indicates a healthy market with potential for competitive pricing. 3. The contract type (Cost Plus Fixed Fee) can lead to cost overruns if not managed closely. 4. Leidos, Inc. is a large, established contractor with a significant presence in government services. 5. The R&D NAICS code points to a focus on advanced technological development. 6. The contract duration of over 6 years allows for sustained support and development. 7. The absence of small business set-aside suggests the primary contractor is likely a large business.
Value Assessment
Rating: good
The contract's total value of $18.3M over roughly 6.7 years averages to approximately $2.7M annually. This figure appears reasonable for specialized SE&I support within the defense sector, particularly for counter-WMD intelligence, surveillance, and reconnaissance. Benchmarking against similar large-scale R&D and systems engineering contracts for defense agencies suggests this pricing is within expected ranges, assuming the scope of work is comparable. The Cost Plus Fixed Fee (CPFF) contract type, while allowing flexibility, necessitates careful oversight to ensure costs remain aligned with the fixed fee and overall value.
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 offers. The specific number of bidders is not provided, but the designation suggests a competitive process was utilized. This approach generally fosters price discovery and allows the government to select the best value offering from a broad range of potential contractors. The presence of multiple bidders, implied by 'full and open,' typically leads to more competitive pricing and a wider array of technical solutions.
Taxpayer Impact: Taxpayers benefit from full and open competition through potentially lower prices and access to a wider range of innovative solutions. This process helps ensure that government funds are used efficiently by driving down costs and maximizing the quality of services received.
Public Impact
The primary beneficiaries are the Department of Defense and its agencies, specifically the Defense Threat Reduction Agency (DTRA), in their mission to counter weapons of mass destruction. The contract delivers critical systems engineering and integration support for intelligence, surveillance, and reconnaissance (ISR) capabilities. The geographic impact is primarily national, supporting defense operations and intelligence gathering efforts, with potential global implications. Workforce implications include employment for highly skilled engineers, scientists, and technical professionals within Leidos, Inc. and potentially its subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type can incentivize contractor to increase costs to maximize profit if not properly managed.
- The duration of the contract (over 6 years) may lead to scope creep or evolving requirements that are not fully captured in the initial pricing.
- Lack of specific performance metrics or outcome-based measures could hinder accountability for service delivery.
Positive Signals
- Awarded under full and open competition, suggesting a robust selection process and potential for competitive pricing.
- Leidos, Inc. is a large, experienced contractor with a proven track record in complex government programs.
- The contract supports a critical national security mission (counter-WMD ISR), indicating strategic importance and likely strong government oversight.
Sector Analysis
The contract falls within the Research and Development in the Physical, Engineering, and Life Sciences sector, specifically NAICS code 541712. This sector is characterized by innovation and the development of advanced technologies. The market for defense-related R&D and systems engineering is substantial, with significant government investment. Comparable spending benchmarks would involve other large-scale contracts for defense intelligence, ISR, and WMD counter-proliferation technologies, often awarded to major defense contractors.
Small Business Impact
This contract does not appear to have a small business set-aside (sb: false). As a large contract awarded to a prime contractor likely to be a large business (Leidos, Inc.), there may be opportunities for small businesses to participate as subcontractors. However, the extent of subcontracting to small businesses is not detailed in the provided data. The absence of a specific set-aside means that small businesses would need to compete for subcontracts directly with the prime or other large subcontractors.
Oversight & Accountability
Oversight for this contract is likely managed by the Defense Threat Reduction Agency (DTRA) within the Department of Defense. As a Cost Plus Fixed Fee contract, rigorous financial oversight and auditing are expected to ensure that costs are reasonable and allocable to the contract. Transparency would be facilitated through regular reporting requirements from the contractor and potential reviews by the Government Accountability Office (GAO) or the DoD Inspector General (IG) if specific concerns arise.
Related Government Programs
- Intelligence, Surveillance, and Reconnaissance (ISR) Systems
- Weapons of Mass Destruction (WMD) Counter-Proliferation Programs
- Defense Research and Development Contracts
- Systems Engineering and Integration Services
- Department of Defense IT and Technical Support Contracts
Risk Flags
- Potential for cost overruns due to CPFF contract type.
- Risk of requirements becoming outdated over the long contract duration.
- Need for robust oversight to ensure contractor efficiency and cost control.
- Dependence on a single large contractor may limit future flexibility.
Tags
defense, department-of-defense, leidos-inc, counter-wmd, isr, systems-engineering, research-and-development, full-and-open-competition, cost-plus-fixed-fee, virginia, large-contract, intelligence-support
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $18.3 million to LEIDOS, INC.. COUNTER WEAPONS OF MASS DESTRUCTION INTELLIGENCE, SURVEILLANCE, AND RECONNAISSANCE TEAM SYSTEM ENGINEERING AND INTEGRATION (SE&I) SUPPORT
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Threat Reduction Agency).
What is the total obligated amount?
The obligated amount is $18.3 million.
What is the period of performance?
Start: 2019-05-01. End: 2025-12-02.
What is Leidos, Inc.'s track record with similar defense contracts, particularly in ISR and counter-WMD?
Leidos, Inc. has a substantial history of performing complex defense and intelligence contracts for the U.S. government. They are a major provider of systems engineering, integration, and technical support services across various domains, including ISR and national security. Their experience often involves large-scale, multi-year programs requiring advanced technological solutions and program management expertise. While specific details on past counter-WMD ISR contracts would require deeper analysis, Leidos's overall profile as a prime contractor for the Department of Defense suggests they possess the necessary capabilities and experience to execute this type of requirement effectively. Their financial stability and established infrastructure further support their capacity to handle significant contract values and durations.
How does the annual spending on this contract compare to other DoD ISR or R&D initiatives?
The approximate annual spending of $2.7M for this contract ($18.3M over ~6.7 years) is moderate when compared to the vast landscape of Department of Defense ISR and R&D initiatives. Major platform development, large-scale system procurements, or advanced research programs can easily run into hundreds of millions or even billions of dollars annually. This contract appears to focus on specialized systems engineering and integration support for a specific capability area (counter-WMD ISR). Therefore, while significant for the specific function it serves, its annual spend is likely a fraction of the overall DoD budget allocated to broader ISR modernization or foundational R&D efforts. Benchmarking requires comparing it to contracts with similar scope and technical complexity rather than just overall ISR or R&D spending.
What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for this type of service?
The primary risk with a Cost Plus Fixed Fee (CPFF) contract, especially for R&D and systems engineering, is the potential for cost overruns. While the government agrees to pay the contractor's allowable costs plus a fixed fee, the contractor has less incentive to control costs compared to fixed-price contracts. If costs escalate significantly beyond initial estimates, the government still pays the actual costs, potentially exceeding the anticipated budget. This necessitates robust government oversight to scrutinize allowable costs, ensure efficiency, and prevent unnecessary expenditures. Another risk is that the fixed fee, once negotiated, might not adequately compensate the contractor if the scope of work expands significantly, potentially leading to disputes or reduced contractor motivation unless contract modifications are pursued.
How effective is 'full and open competition' in ensuring value for money for specialized R&D contracts like this?
Full and open competition is generally considered a strong mechanism for ensuring value for money, even for specialized R&D contracts. It allows a wide pool of potential offerors to compete, fostering innovation and driving down prices through market forces. For R&D, this means the government can access a broader range of technical approaches and potentially discover more cost-effective solutions. However, the effectiveness hinges on the clarity of the solicitation's requirements and evaluation criteria. In highly specialized R&D, defining requirements precisely can be challenging, and evaluating technical merit requires deep expertise. If the competition is well-structured, with clear technical and cost evaluation factors, it significantly increases the likelihood of obtaining the best value. Conversely, poorly defined requirements or evaluations can undermine the benefits of broad competition.
What are the implications of the contract's duration (over 6 years) on its long-term effectiveness and cost?
A contract duration of over six years for systems engineering and integration support offers significant advantages for long-term effectiveness. It allows for sustained development, iterative improvements, and deep integration of complex systems, which is crucial for evolving threats like WMD. This extended period provides stability for the contractor, enabling them to build specialized teams and institutional knowledge. From a cost perspective, longer-term contracts can sometimes lead to better overall value by reducing the administrative burden and costs associated with frequent re-competition. However, it also increases the risk of requirements becoming outdated or misaligned with evolving technological landscapes or strategic priorities. Therefore, effective contract management, including provisions for review and potential modification, is essential to ensure the contract remains relevant and cost-effective throughout its lifespan.
Are there specific performance metrics or KPIs associated with this contract that indicate its success?
The provided data does not include specific performance metrics or Key Performance Indicators (KPIs) for this contract. For a contract focused on systems engineering and integration support, typical metrics might include on-time delivery of milestones, adherence to technical specifications, successful system integration testing, cost performance against budget, and effectiveness of technical solutions in meeting operational requirements. The absence of this information in the summary data means a detailed assessment of the contract's performance effectiveness cannot be made. However, for a CPFF contract, performance is often monitored through regular progress reports, technical reviews, and adherence to the Statement of Work (SOW).
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: HDTRA112R0016
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 1750 PRESIDENTS ST, 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: $20,091,451
Exercised Options: $18,726,017
Current Obligation: $18,336,268
Subaward Activity
Number of Subawards: 35
Total Subaward Amount: $2,703,000
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HDTRA114D0008
IDV Type: IDC
Timeline
Start Date: 2019-05-01
Current End Date: 2025-12-02
Potential End Date: 2025-12-02 00:00:00
Last Modified: 2025-07-14
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