DoD's $37.4M CACI contract for CORE PDSS services shows strong competition and fair value

Contract Overview

Contract Amount: $37,407,858 ($37.4M)

Contractor: CACI, Inc. - Federal

Awarding Agency: Department of Defense

Start Date: 2023-01-01

End Date: 2024-11-10

Contract Duration: 679 days

Daily Burn Rate: $55.1K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIXED PRICE INCENTIVE

Sector: IT

Official Description: CORE PDSS SERVICES YEAR 4

Place of Performance

Location: STAFFORD, STAFFORD County, VIRGINIA, 22556

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $37.4 million to CACI, INC. - FEDERAL for work described as: CORE PDSS SERVICES YEAR 4 Key points: 1. Contract awarded through full and open competition, indicating a robust bidding process. 2. Pricing appears competitive when benchmarked against similar custom computer programming services. 3. Fixed Price Incentive contract type suggests a focus on performance and cost control. 4. The contract duration of 679 days aligns with typical project lifecycles for complex IT services. 5. CACI, Inc. - Federal, a large established contractor, is well-positioned to deliver these services. 6. No small business set-aside was utilized, suggesting the scope may not have been conducive to smaller entities.

Value Assessment

Rating: good

The contract's total value of approximately $37.4 million over its period of performance appears reasonable given the scope of custom computer programming services. Benchmarking against similar contracts for IT development and support within the Department of Defense suggests that the pricing is within an acceptable range. The Fixed Price Incentive (FPI) contract type, while complex, aims to incentivize both the contractor and the government to achieve cost and performance targets, potentially leading to better value than simpler contract types if managed effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. The data does not specify the number of bids received, but the designation implies a competitive process that should foster price discovery and potentially lead to more favorable pricing for the government. The use of full and open competition is generally preferred as it maximizes the pool of potential offerors and promotes a fair marketplace.

Taxpayer Impact: A competitive award process like this typically benefits taxpayers by driving down costs through market forces and ensuring the government receives services at a price reflecting true market value.

Public Impact

The Department of Defense benefits from the delivery of essential CORE PDSS services, likely supporting critical operational or administrative functions. This contract ensures the continued provision of custom computer programming services, vital for modern defense operations. The primary geographic impact is within the Department of the Navy's operational sphere, likely supporting its IT infrastructure. The contract supports the workforce of CACI, Inc. - Federal, contributing to employment in the IT services sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if performance targets are not met or if incentive clauses are not structured optimally.
Reliance on a single large contractor may limit future flexibility or opportunities for smaller, innovative firms.
The complexity of Fixed Price Incentive contracts requires diligent oversight to ensure fair pricing and performance.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
Fixed Price Incentive contract type can align contractor and government interests for cost efficiency.
CACI, Inc. - Federal is an established contractor with a track record in government IT services.
The contract duration is defined, providing a clear timeframe for service delivery and performance evaluation.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically custom computer programming services. The IT services market for the federal government is substantial, with significant spending allocated to software development, system integration, and IT support. Contracts like this are crucial for maintaining and modernizing the technological capabilities of defense agencies. Comparable spending benchmarks for custom programming services vary widely based on complexity, duration, and specific requirements, but this contract's value is consistent with large-scale IT projects within the federal space.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it indicate any specific subcontracting requirements for small businesses. This suggests that the primary contractor, CACI, Inc. - Federal, will likely perform the majority of the work in-house. The absence of set-asides or explicit subcontracting goals may limit direct opportunities for small businesses on this specific contract, though CACI may engage them as part of its broader supply chain.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Navy contracting officers and program managers responsible for the CORE PDSS. The Fixed Price Incentive contract type necessitates close monitoring of performance metrics and cost expenditures to ensure that incentive clauses are applied correctly and that the government receives the best value. Transparency is facilitated through contract award databases and reporting requirements. While specific Inspector General (IG) jurisdiction is not detailed here, the DoD IG typically has oversight over major defense contracts.

Related Government Programs

Department of Defense IT Services
Custom Computer Programming
Navy IT Modernization
Software Development Contracts
Federal IT Support Services

Risk Flags

Potential for cost overruns due to FPI contract type complexity.
Scope creep risk given the contract duration.
Reliance on a single large contractor.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.4 million to CACI, INC. - FEDERAL. CORE PDSS SERVICES YEAR 4

Who is the contractor on this award?

The obligated recipient is CACI, INC. - FEDERAL.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $37.4 million.

What is the period of performance?

Start: 2023-01-01. End: 2024-11-10.

What is CACI, Inc. - Federal's track record with the Department of Defense for similar IT services?

CACI, Inc. - Federal is a large and established government contractor with a significant history of providing IT services to the Department of Defense and other federal agencies. They have a broad portfolio encompassing IT modernization, software development, cybersecurity, and enterprise IT support. Their past performance with the DoD includes numerous contracts of varying sizes and complexities, often related to command and control systems, intelligence analysis tools, and business system modernization. While specific details of past performance on contracts directly analogous to CORE PDSS would require deeper analysis of contract histories and performance reviews, CACI's overall experience suggests a strong capability to execute complex IT projects for defense clients. Their extensive experience often translates into a deep understanding of DoD requirements and operational environments.

How does the $37.4 million value compare to other custom computer programming contracts awarded by the DoD in the last fiscal year?

The $37.4 million value for this 4-year contract (approximately $9.35 million annually) for CORE PDSS services is substantial but falls within the typical range for large-scale custom computer programming and IT support contracts awarded by the Department of Defense. The DoD procures a vast array of IT services, with individual contract values ranging from a few million dollars for specialized projects to hundreds of millions or even billions for enterprise-wide solutions. When compared to other custom computer programming contracts, this award appears to be of moderate to significant size, reflecting a substantial scope of work. For instance, contracts for developing or maintaining complex defense systems, large database management, or integrated software suites often exceed this value. However, it is also larger than many smaller, more focused software development tasks or IT support agreements.

What are the primary risks associated with a Fixed Price Incentive (FPI) contract type for this service?

The primary risks associated with a Fixed Price Incentive (FPI) contract type for custom computer programming services like CORE PDSS involve the complexity of managing the incentive structure and the potential for disputes. For the government, the risk lies in ensuring the target cost and target profit are realistic and that the ceiling price is not exceeded. If the contractor significantly outperforms cost targets, the government's share of the savings might be less than desired. Conversely, if costs escalate, the government is obligated to pay the negotiated price up to the ceiling. For the contractor, the risk is in managing costs effectively to achieve the target profit and avoid exceeding the price ceiling, which could lead to losses. Both parties face the risk of disagreements over performance metrics, cost accounting, and the interpretation of incentive clauses, potentially leading to delays and increased administrative burden.

How effective is full and open competition in ensuring value for money for custom IT services?

Full and open competition is generally considered the most effective method for ensuring value for money in federal contracting, including for custom IT services. By allowing all responsible sources to compete, the government maximizes the potential for receiving the best combination of price, technical approach, and past performance. This broad competition drives down prices as contractors vie for the award, and it encourages innovation as they seek to differentiate their offerings. Furthermore, a competitive process provides a strong basis for price reasonableness determination. While effective competition requires clear requirements and a well-structured evaluation process, it significantly reduces the risk of overpaying or receiving substandard services compared to sole-source or limited competition awards. The government benefits from market forces that reward efficiency and quality.

What are the historical spending patterns for custom computer programming services within the Department of the Navy?

Historical spending patterns for custom computer programming services within the Department of the Navy (DoN) show a consistent and significant investment in IT modernization, software development, and specialized system support. The DoN, like other branches of the DoD, relies heavily on tailored software solutions to manage complex operations, from logistics and personnel to intelligence and combat systems. Spending in this category typically fluctuates based on major program initiatives, system upgrades, and evolving technological requirements. There has been a sustained trend towards acquiring services that support digital transformation, cloud migration, and cybersecurity enhancements. While specific annual figures vary, the DoN consistently allocates billions of dollars annually towards IT services, with a notable portion dedicated to custom development and programming to meet unique defense needs that off-the-shelf solutions cannot address.

What are the implications of the contract's duration (679 days) on project management and potential for scope creep?

The contract duration of 679 days (approximately 22 months) for CORE PDSS services provides a substantial timeframe for project execution, allowing for phased development, testing, and implementation. This duration is generally appropriate for complex custom programming projects that require significant design, coding, and integration efforts. However, a longer duration also increases the potential for scope creep if requirements are not meticulously managed and change control processes are not rigorously enforced. The Fixed Price Incentive structure can help mitigate scope creep by tying additional costs to approved changes and performance outcomes. Effective project management, clear communication, and strong government oversight are crucial to ensure that the project stays on track, within budget, and aligned with its original objectives throughout this extended period.

Industry Classification

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

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: M6785418R7600

Pricing Type: FIXED PRICE INCENTIVE (L)

Evaluated Preference: NONE

Contractor Details

Parent Company: CACI International Inc

Address: 14370 NEWBROOK DRIVE, CHANTILLY, VA, 20151

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

Financial Breakdown

Contract Ceiling: $37,407,858

Exercised Options: $37,407,858

Current Obligation: $37,407,858

Actual Outlays: $19,843,052

Subaward Activity

Number of Subawards: 17

Total Subaward Amount: $9,034,718

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: M6785419D7614

IDV Type: IDC

Timeline