DoD's $123M Foreign Investment Risk Program Support Services contract awarded to SPA, Inc. raises value concerns

Contract Overview

Contract Amount: $123,451,535 ($123.5M)

Contractor: Systems Planning and Analysis, Inc.

Awarding Agency: Department of Defense

Start Date: 2019-09-28

End Date: 2026-03-18

Contract Duration: 2,363 days

Daily Burn Rate: $52.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FOREIGN INVESTMENT RISK PROGRAM SUPPORT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20301

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $123.5 million to SYSTEMS PLANNING AND ANALYSIS, INC. for work described as: FOREIGN INVESTMENT RISK PROGRAM SUPPORT SERVICES Key points: 1. The contract's value appears high relative to the services provided, warranting a closer look at cost-effectiveness. 2. Full and open competition was utilized, suggesting a potentially competitive pricing environment. 3. The contract duration and delivery order structure may introduce risks related to scope creep and cost overruns. 4. Performance context is limited, making it difficult to assess the contractor's effectiveness and impact. 5. This contract falls within the professional, scientific, and technical services sector, a broad category with varying benchmarks. 6. The contract's significant value and long duration necessitate robust oversight to ensure taxpayer funds are used efficiently.

Value Assessment

Rating: questionable

The contract's total value of over $123 million over its potential duration raises questions about value for money. Without detailed performance metrics or comparable contract data, it is difficult to benchmark the pricing effectively. The firm-fixed-price structure provides some cost certainty, but the overall expenditure warrants scrutiny to ensure it aligns with the delivered services and expected outcomes. Further analysis of task orders and deliverables would be necessary for a more precise valuation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. This competitive process is generally expected to drive down prices and encourage innovation. However, the number of bidders (2) is on the lower side for a contract of this magnitude, which could suggest limitations in the market or the specific requirements of the solicitation. The specific details of the bidding process and the evaluation criteria would provide further insight into the effectiveness of the competition.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically leads to more competitive pricing and a wider range of solutions. However, with only two bidders, the potential for significant cost savings might have been constrained compared to a more robustly contested procurement.

Public Impact

The primary beneficiaries are likely the Department of Defense components that require support for the Foreign Investment Risk Program. Services delivered include professional, scientific, and technical support, crucial for analyzing and mitigating foreign investment risks. The contract's geographic impact is centered in the Washington D.C. area, where the Washington Headquarters Services are located. Workforce implications include the creation of jobs for professionals in technical, analytical, and consulting fields.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the long contract duration and delivery order structure.
Limited transparency on specific deliverables and performance metrics makes value assessment challenging.
The relatively low number of bidders (2) might indicate less competitive pressure than ideal for a contract of this size.
Risk of scope creep if task orders are not tightly managed against the program's objectives.

Positive Signals

Awarded under full and open competition, which theoretically promotes fair pricing.
Firm-fixed-price contract type provides a degree of cost certainty for the government.
The contractor, Systems Planning and Analysis, Inc., has a track record that can be reviewed for performance history.
The contract supports a critical national security function related to foreign investment risk.

Sector Analysis

This contract falls under the 'All Other Professional, Scientific, and Technical Services' category (NAICS 541990). This sector encompasses a wide range of specialized services. Benchmarking within this broad category can be challenging, but contracts of this size often involve complex analytical, advisory, and support functions. The market for such services is competitive, with numerous firms offering expertise in areas relevant to national security and risk analysis.

Small Business Impact

The data indicates that small business participation (sb) is false, and there is no indication of a small business set-aside. This suggests that the contract was not specifically targeted towards small businesses. Consequently, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. The prime contractor, Systems Planning and Analysis, Inc., is likely a large business, and its subcontracting plans, if any, would need to be assessed separately to understand potential opportunities for small businesses.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and program management offices, specifically within the Washington Headquarters Services. The firm-fixed-price nature of the contract provides some cost control, but the delivery order structure necessitates diligent monitoring of each order's scope, cost, and performance. Transparency regarding task order awards and performance reports would be key to effective oversight. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Foreign Military Sales Program Support
Defense Security Cooperation Agency Services
National Security Council Support Services
Department of Defense Intelligence Support

Risk Flags

Potential for cost growth due to long duration and delivery order structure.
Limited number of bidders may reduce competitive pressure.
Scope definition and management critical for firm-fixed-price success.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $123.5 million to SYSTEMS PLANNING AND ANALYSIS, INC.. FOREIGN INVESTMENT RISK PROGRAM SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is SYSTEMS PLANNING AND ANALYSIS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Washington Headquarters Services).

What is the total obligated amount?

The obligated amount is $123.5 million.

What is the period of performance?

Start: 2019-09-28. End: 2026-03-18.

What is the historical spending pattern for similar Foreign Investment Risk Program support services within the Department of Defense?

Analyzing historical spending for similar services is crucial for contextualizing the current $123 million award. While specific data for 'Foreign Investment Risk Program Support Services' is not readily available in the provided snippet, broader categories of 'Professional, Scientific, and Technical Services' (NAICS 541990) within the DoD often represent significant expenditures. For instance, contracts related to policy analysis, risk assessment, and strategic planning can run into tens or hundreds of millions of dollars over their lifecycle. Examining past contracts awarded by Washington Headquarters Services or other DoD entities for comparable analytical and advisory support could reveal trends in contract duration, value, and contractor performance. Without this historical context, it's difficult to definitively state whether this specific contract represents an increase, decrease, or stable level of investment in these types of services.

How does the per-unit cost or hourly rate for this contract compare to industry benchmarks for similar professional services?

Determining the per-unit cost or hourly rate for this contract is challenging without access to the specific task orders and the labor categories involved. The contract is a firm-fixed-price award with a delivery order structure, meaning pricing is established for specific deliverables or periods of performance within each order. To benchmark effectively, one would need to compare the rates for specific labor categories (e.g., senior analysts, subject matter experts) against industry surveys and government databases like the General Services Administration (GSA) schedules or other agency-specific rate ceilings. Given the contract's focus on specialized support for risk analysis, the rates could be expected to be at the higher end of the professional services spectrum. A detailed review of awarded task orders would be necessary to perform a meaningful per-unit cost comparison.

What are the key performance indicators (KPIs) used to measure the success of Systems Planning and Analysis, Inc. under this contract?

The provided data does not specify the Key Performance Indicators (KPIs) for this contract. Typically, for professional, scientific, and technical services, KPIs would relate to the quality of analysis, timeliness of reports, accuracy of risk assessments, adherence to deadlines, and overall client satisfaction. For a contract supporting a 'Foreign Investment Risk Program,' KPIs might include the identification and assessment of specific investment risks, the development of mitigation strategies, and the clarity and actionability of recommendations provided to DoD decision-makers. The effectiveness of Systems Planning and Analysis, Inc. would be evaluated against these metrics, which should be detailed in the contract's Performance Work Statement (PWS) or Statement of Objectives (SOO).

What is the track record of Systems Planning and Analysis, Inc. in delivering similar support services to the Department of Defense or other federal agencies?

Systems Planning and Analysis, Inc. (SPA) has a significant history of providing support services to the Department of Defense and other federal agencies. Their contract portfolio often includes areas such as systems engineering, program management, financial analysis, and policy support. To assess their track record specifically for 'Foreign Investment Risk Program Support Services,' one would need to review their past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS) and any publicly available information on similar projects. SPA's experience in defense analysis and strategic planning suggests a capability to handle complex requirements. However, a detailed review of their performance on prior contracts, particularly those involving risk assessment and advisory services, is necessary to fully gauge their suitability and past success.

Are there any identified risks associated with the contractor's financial stability or past performance that could impact contract execution?

The provided data does not contain information regarding the financial stability or specific past performance risks associated with Systems Planning and Analysis, Inc. for this contract. Standard government procurement processes involve assessing a contractor's responsibility, which includes financial health and past performance. Agencies typically review data from sources like the Contractor Performance Assessment Reporting System (CPARS) and conduct financial viability checks. Without access to these internal assessments or specific negative performance indicators, it is presumed that SPA was deemed responsible at the time of award. However, ongoing monitoring throughout the contract's life is essential to identify and mitigate any emerging risks related to performance or financial stability.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HQ003419R0330

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2001 N BEAUREGARD ST., SUITE 100, ALEXANDRIA, VA, 22311

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $127,795,535

Exercised Options: $127,795,535

Current Obligation: $123,451,535

Actual Outlays: $2,543,744

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HQ003415D0018

IDV Type: IDC

Timeline