Booz Allen Hamilton awarded $40.2M for engineering services to support Navy communications and information systems

Contract Overview

Contract Amount: $40,255,226 ($40.3M)

Contractor: Booz Allen Hamilton Inc

Awarding Agency: Department of Defense

Start Date: 2008-09-01

End Date: 2013-07-31

Contract Duration: 1,794 days

Daily Burn Rate: $22.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST NO FEE

Sector: IT

Official Description: TECHNICAL AND ENGINEERING SERVICES TO SUPPORT COMMUNICATIONS AND INFORMATION SYS

Place of Performance

Location: SAINT INIGOES, SAINT MARYS County, MARYLAND, 20684

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $40.3 million to BOOZ ALLEN HAMILTON INC for work described as: TECHNICAL AND ENGINEERING SERVICES TO SUPPORT COMMUNICATIONS AND INFORMATION SYS Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract duration of 1794 days (approx. 5 years) indicates a long-term need for these services. 3. The contract type is Cost No Fee, which typically involves the contractor bearing the risk of cost overruns. 4. The award was a delivery order, suggesting it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract. 5. The North American Industry Classification System (NAICS) code 541330 points to engineering services. 6. The contract was awarded to Booz Allen Hamilton, a large and established government contractor.

Value Assessment

Rating: good

The contract's Cost No Fee (CNF) structure places cost risk on the contractor, which can be favorable for the government if costs are managed effectively. Benchmarking the $40.2 million total value against similar long-term engineering support contracts for complex defense systems is challenging without more specific service details. However, the duration and scope suggest a significant investment. The absence of a fee structure implies that the government is primarily paying for the direct costs incurred by the contractor, plus any agreed-upon indirect costs, without an additional profit margin on top of those costs. This can lead to better value if the contractor is efficient.

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 bids. The fact that it was a delivery order suggests it was likely competed as part of a broader IDIQ contract. The number of bidders is not specified, but full and open competition generally fosters a competitive environment, which can lead to better pricing and service offerings for the government.

Taxpayer Impact: Full and open competition is generally beneficial for taxpayers as it encourages multiple companies to bid, driving down prices and improving the quality of services offered.

Public Impact

The Department of the Navy benefits from enhanced communications and information systems support. This contract supports critical defense infrastructure and operational capabilities. The services provided are essential for maintaining and improving the effectiveness of military communication networks. The contract's impact is primarily within the defense sector, supporting national security objectives.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost No Fee contracts can sometimes lead to less contractor focus on cost efficiency if not properly monitored.
The long duration of the contract could lead to potential scope creep if not managed tightly.
Reliance on a single large contractor for critical systems support may present risks if the contractor faces financial or operational difficulties.

Positive Signals

Awarded under full and open competition, suggesting a robust and competitive selection process.
Booz Allen Hamilton is a well-established contractor with a significant track record in government services.
The Cost No Fee structure can incentivize contractor efficiency and cost control.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting IT and communications systems for the Department of Defense. The market for defense IT and engineering support is substantial, with numerous large and small businesses competing for contracts. Booz Allen Hamilton is a major player in this space, often securing large, complex contracts. Spending in this area is driven by the need for advanced technological capabilities and ongoing modernization of military systems.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Booz Allen Hamilton is a large business, and while they may engage small business subcontractors, the primary awardee is not a small entity. This means opportunities for direct prime contracting were likely limited for small businesses on this specific award, though they may benefit indirectly through subcontracting.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Given the nature of the services, there would likely be performance metrics and reporting requirements. Inspector General (IG) jurisdiction would apply for investigations into fraud, waste, or abuse. Transparency is generally maintained through contract award databases like FPDS, though detailed performance data may be less public.

Related Government Programs

Defense Information Technology Support Services
Naval Command, Control, Communications, Computers, and Intelligence (C4I) Systems
Engineering and Technical Services Contracts
IT Modernization Programs
Federal IT Services

Risk Flags

Long contract duration may lead to technology obsolescence.
Cost No Fee structure requires diligent contractor cost management.
Potential for scope creep over the contract's extended period.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $40.3 million to BOOZ ALLEN HAMILTON INC. TECHNICAL AND ENGINEERING SERVICES TO SUPPORT COMMUNICATIONS AND INFORMATION SYS

Who is the contractor on this award?

The obligated recipient is BOOZ ALLEN HAMILTON INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $40.3 million.

What is the period of performance?

Start: 2008-09-01. End: 2013-07-31.

What is the specific nature of the 'communications and information systems' being supported under this contract?

The contract description 'TECHNICAL AND ENGINEERING SERVICES TO SUPPORT COMMUNICATIONS AND INFORMATION SYS' is broad. Without further details, it's difficult to ascertain the exact systems. However, given the Department of the Navy context, these likely encompass a range of critical infrastructure including secure communication networks, command and control systems, intelligence processing platforms, and associated IT infrastructure. Services could include system design, integration, testing, maintenance, cybersecurity, and lifecycle support for these complex defense systems. The specific systems supported would dictate the technical expertise required from Booz Allen Hamilton.

How does the Cost No Fee (CNF) contract type compare to other pricing arrangements for similar services?

Cost No Fee (CNF) contracts are less common than other cost-reimbursement types like Cost Plus Fixed Fee (CPFF) or Cost Plus Incentive Fee (CPIF). In a CNF structure, the contractor is reimbursed for allowable costs but receives no fee or profit. This places the entire financial risk on the contractor, incentivizing them to control costs rigorously. Compared to CPFF, where a fixed fee is agreed upon, CNF offers potentially greater savings for the government if costs are managed well, but may also deter contractors if the risk is perceived as too high or if the scope is uncertain. For complex, long-term engineering services, CNF is often used when the scope is well-defined and the contractor has a high degree of confidence in their ability to manage costs.

What is Booz Allen Hamilton's track record with similar Department of Defense IT and engineering contracts?

Booz Allen Hamilton is a major incumbent contractor for the Department of Defense (DoD) and has a long history of providing a wide array of technical, engineering, and IT services. They consistently rank among the top contractors for the DoD, securing numerous large-value contracts across various branches, including the Navy. Their portfolio includes support for command and control systems, intelligence analysis, cybersecurity, enterprise IT, and strategic consulting. Their extensive experience suggests a strong capability to manage complex projects like the one described, although performance can vary across individual contracts. Reviewing past performance evaluations and contract histories would provide a more granular assessment.

What are the potential risks associated with a long-duration contract (1794 days) for engineering services?

Long-duration contracts, such as this 1794-day (approximately 4.8 years) award, carry several potential risks. Technology can rapidly evolve, meaning the systems and services specified at the outset may become outdated or less efficient by the contract's end, requiring costly modifications or replacements. Scope creep is another significant risk; as the project progresses, additional requirements or changes may be introduced, potentially increasing costs and extending timelines beyond initial projections if not managed strictly through contract modification procedures. Furthermore, a prolonged engagement with a single contractor can reduce flexibility and limit opportunities to incorporate innovative solutions from other market players. Maintaining consistent oversight and performance management throughout the contract's lifecycle is crucial to mitigate these risks.

How does the $40.2 million total contract value compare to annual spending on similar engineering services by the Department of the Navy?

The $40.2 million total value for this specific contract, spread over nearly five years, represents an average annual value of approximately $8.4 million. This figure needs to be contextualized within the Department of the Navy's overall IT and engineering services budget, which runs into billions of dollars annually. While $8.4 million per year is a substantial amount for a single contract, it is likely a relatively small portion of the Navy's total spending in this category. The Navy procures a vast array of services, from large-scale system development to specialized technical support. Therefore, this contract's value, while significant, should be viewed as one component of a much larger procurement landscape for engineering and IT support.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering 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: N0002408R3028

Offers Received: 2

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Parent Company: Booz Allen Hamilton Holding Corporation (UEI: 964725688)

Address: BOOZ ALLEN HAMILTON INC, MC LEAN, VA, 22102

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $40,936,383

Exercised Options: $40,936,383

Current Obligation: $40,255,226

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4024

IDV Type: IDC

Timeline