DoD's $18.4M contract for ARMS CONTROL ENTERPRISE SYSTEM (ACES) support awarded to PERATON INC. on a sole-source basis
Contract Overview
Contract Amount: $18,432,321 ($18.4M)
Contractor: Peraton Inc.
Awarding Agency: Department of Defense
Start Date: 2021-06-15
End Date: 2026-06-14
Contract Duration: 1,825 days
Daily Burn Rate: $10.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: ARMS CONTROL ENTERPRISE SYSTEM (ACES) AND INSPECTION PLANNING MODULE (IPM) SUPPORT
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20170
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $18.4 million to PERATON INC. for work described as: ARMS CONTROL ENTERPRISE SYSTEM (ACES) AND INSPECTION PLANNING MODULE (IPM) SUPPORT Key points: 1. Contract awarded on a sole-source basis, limiting competitive price discovery. 2. Significant investment in specialized technical services for defense threat reduction. 3. Contract duration of five years suggests a long-term need for these services. 4. Performance-based contract type indicates a focus on achieving specific outcomes. 5. Potential for cost overruns given the Cost Plus Fixed Fee structure. 6. Geographic concentration in Virginia may indicate specific operational needs.
Value Assessment
Rating: questionable
Benchmarking the value of this $18.4 million contract is challenging due to its sole-source nature and the specialized technical services provided. Without competitive bids, it's difficult to ascertain if the pricing reflects fair market value. The Cost Plus Fixed Fee (CPFF) structure, while allowing for flexibility, can sometimes lead to higher costs compared to fixed-price contracts if not managed diligently. Further analysis would require access to detailed cost breakdowns and comparisons with similar, competitively awarded contracts for specialized defense systems support.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one contractor, PERATON INC., was solicited. This approach bypasses the standard competitive bidding process, which typically involves multiple companies submitting proposals. While sole-source awards can be justified for unique capabilities or urgent needs, they inherently reduce price competition and may not yield the most cost-effective outcome for the government.
Taxpayer Impact: The lack of competition means taxpayers may not benefit from the cost savings that typically arise from a competitive bidding environment. This could translate to a higher overall expenditure for the services rendered.
Public Impact
The primary beneficiaries are the Department of Defense, specifically the Defense Threat Reduction Agency, which will receive enhanced support for its arms control enterprise systems. Services delivered include crucial support for the ARMS CONTROL ENTERPRISE SYSTEM (ACES) and INSPECTION PLANNING MODULE (IPM). The contract's geographic impact is centered in Virginia, where the contractor is located and likely where the services will be performed or managed. Workforce implications may include the employment of specialized technical personnel by PERATON INC. to fulfill the contract requirements.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price competition, potentially increasing costs for taxpayers.
- Cost Plus Fixed Fee contract type can incentivize higher spending if not closely monitored.
- Lack of transparency in the sole-source justification process.
- Specialized nature of services makes independent cost verification difficult.
Positive Signals
- Contract supports critical national security functions related to arms control.
- Long-term contract duration (5 years) suggests a stable and reliable service provider.
- Focus on specific systems (ACES, IPM) indicates tailored support for essential defense tools.
Sector Analysis
The IT services sector supporting defense applications is highly specialized. This contract falls within the broader category of professional, scientific, and technical services, specifically focusing on niche software and systems support for national security. The market for such specialized defense IT support is often characterized by a limited number of qualified contractors, which can sometimes lead to sole-source or limited competition awards. Comparable spending benchmarks are difficult to establish without more detailed service descriptions and market analysis.
Small Business Impact
This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss': false flag suggests it is not a small business prime contractor. Therefore, the direct impact on small businesses through this specific prime contract is likely minimal, unless PERATON INC. engages small businesses as subcontractors. Analysis of subcontracting plans would be necessary to determine the extent of small business participation.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of Defense and the Defense Threat Reduction Agency. As a sole-source award, the justification and negotiation process would be subject to internal DoD procurement regulations and potentially oversight from the Government Accountability Office (GAO) if protests were filed. Transparency is limited due to the non-competitive nature, but contract performance and financial reporting would be monitored by the contracting officer. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Defense Threat Reduction Agency (DTRA) Operations
- Arms Control Treaty Compliance Systems
- DoD Information Technology Services
- National Security Software Development
- Inspection Planning and Execution Systems
Risk Flags
- Sole-source award may limit cost savings.
- CPFF contract structure carries potential for cost overruns.
- Lack of competition reduces market pressure on pricing.
- Long contract duration may lead to technology obsolescence risk.
Tags
defense, department-of-defense, arms-control, it-services, professional-scientific-technical-services, sole-source, definitive-contract, cost-plus-fixed-fee, virginia, large-contract, national-security
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $18.4 million to PERATON INC.. ARMS CONTROL ENTERPRISE SYSTEM (ACES) AND INSPECTION PLANNING MODULE (IPM) SUPPORT
Who is the contractor on this award?
The obligated recipient is PERATON 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 $18.4 million.
What is the period of performance?
Start: 2021-06-15. End: 2026-06-14.
What is the specific justification for awarding this contract on a sole-source basis to PERATON INC.?
The provided data indicates the contract was awarded as 'NOT COMPETED' and is a 'SOLE SOURCE'. While the specific justification is not detailed in the provided snippet, common reasons for sole-source awards in defense contracting include the uniqueness of the contractor's capabilities, the existence of a critical need that cannot be met by other sources, or the continuation of a previous contract where a new competition would be impractical or detrimental to government interests. For this specific contract, it's likely that PERATON INC. possesses proprietary knowledge, specialized technology, or unique expertise essential for the ARMS CONTROL ENTERPRISE SYSTEM (ACES) and INSPECTION PLANNING MODULE (IPM) that other contractors cannot readily replicate. A thorough review of the Justification and Approval (J&A) document would be required to understand the precise rationale.
How does the Cost Plus Fixed Fee (CPFF) contract type compare to other pricing structures in terms of potential cost efficiency for the government?
Cost Plus Fixed Fee (CPFF) contracts are designed to reimburse the contractor for allowable costs incurred, plus a predetermined fixed fee representing profit. This structure is often used when the scope of work is not precisely defined or involves a high degree of uncertainty, such as research and development or complex system integration. While it offers flexibility, CPFF contracts can be less cost-efficient for the government compared to fixed-price contracts. With fixed-price contracts, the contractor assumes more risk and has a greater incentive to control costs to maximize profit. In a CPFF arrangement, the contractor has less incentive to minimize costs, as the government bears the risk of cost overruns. Effective oversight and robust cost controls by the government are crucial to managing expenditures under CPFF contracts.
What are the potential risks associated with a five-year contract duration for specialized IT support?
A five-year contract duration for specialized IT support, like the ARMS CONTROL ENTERPRISE SYSTEM (ACES) and INSPECTION PLANNING MODULE (IPM) support, presents several potential risks. Firstly, technology can evolve rapidly; a five-year commitment might lock the government into outdated systems or solutions if the contractor does not proactively adapt. Secondly, long-term sole-source contracts can lead to complacency and reduced innovation from the contractor, as competitive pressure is minimized. Thirdly, there's a risk of cost escalation over the contract's life, especially if the fixed fee is not adjusted appropriately or if unforeseen cost drivers emerge. Finally, dependency on a single contractor for critical systems can create significant operational risks if the contractor experiences financial instability, undergoes major organizational changes, or fails to meet performance expectations.
What is the historical spending pattern for ARMS CONTROL ENTERPRISE SYSTEM (ACES) and INSPECTION PLANNING MODULE (IPM) support within the Department of Defense?
The provided data only details a single contract award for ARMS CONTROL ENTERPRISE SYSTEM (ACES) AND INSPECTION PLANNING MODULE (IPM) SUPPORT valued at $18.43 million, running from June 15, 2021, to June 14, 2026. This suggests that this specific contract represents a significant, potentially new, or consolidated effort for this type of support. Without access to historical contract databases or agency budget documents, it is impossible to determine the broader historical spending patterns for ACES and IPM support. It's possible that previous support was handled through different contract vehicles, internal resources, or smaller, less consolidated contracts. Further investigation into DTRA's procurement history would be necessary to establish a comprehensive spending trend.
How does the geographic location in Virginia impact the performance and oversight of this contract?
The contract indicates the performance location or contractor's primary base is in Virginia. This geographic concentration can have several implications. For performance, it may suggest that the services are closely tied to specific DoD installations or operational centers located within Virginia, facilitating easier communication and collaboration between the contractor and government personnel. From an oversight perspective, having the contractor physically located in proximity to contracting officers or program managers in Virginia can streamline oversight activities, allowing for more frequent site visits, audits, and direct engagement. However, it also means that if the contractor's operations are solely based in Virginia, any disruptions in that region (e.g., natural disasters, local economic issues) could potentially impact contract performance. It also concentrates the economic benefit of the contract within that specific geographic area.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services
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: HDTRA121R0009
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 12975 WORLDGATE DR STE 7322, HERNDON, VA, 20170
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $19,542,016
Exercised Options: $19,542,016
Current Obligation: $18,432,321
Actual Outlays: $8,474,819
Subaward Activity
Number of Subawards: 7
Total Subaward Amount: $822,268
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2021-06-15
Current End Date: 2026-06-14
Potential End Date: 2026-06-14 00:00:00
Last Modified: 2026-04-02
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