DoD's $43.6M Engineering Services Contract Awarded to BAE Systems Faces Scrutiny

Contract Overview

Contract Amount: $43,624,122 ($43.6M)

Contractor: BAE Systems Technology Solutions & Services Inc.

Awarding Agency: Department of Defense

Start Date: 2015-06-08

End Date: 2020-12-31

Contract Duration: 2,033 days

Daily Burn Rate: $21.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF

Place of Performance

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

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $43.6 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. for work described as: IGF::OT::IGF Key points: 1. The contract, valued at $43.6 million, was awarded to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. 2. Awarded by the Department of the Navy, this falls under Engineering Services (NAICS 541330). 3. The contract utilized full and open competition, suggesting a competitive bidding process. 4. The contract duration spans from June 2015 to December 2020. 5. The contract type is Cost Plus Fixed Fee (CPFF), which can lead to cost overruns if not managed carefully.

Value Assessment

Rating: fair

The Cost Plus Fixed Fee (CPFF) contract type allows for costs plus a fixed fee, which can be less predictable than fixed-price contracts. Benchmarking against similar engineering services contracts is difficult without more detailed cost breakdowns.

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 compete. This method generally promotes price discovery and competitive pricing.

Taxpayer Impact: Taxpayer funds are utilized for this contract. The CPFF structure necessitates careful oversight to ensure costs remain reasonable and the fixed fee is justified.

Public Impact

This contract supports the Department of the Navy's engineering services needs, potentially impacting naval readiness and technological development. The use of CPFF may raise concerns about cost control and efficiency for taxpayers. The duration of the contract (over 5 years) suggests a significant, ongoing need for these services. The award to a large contractor like BAE Systems highlights the role of major defense contractors in government service provision.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type can incentivize higher costs.
Long contract duration may not reflect evolving needs or technological advancements.
Lack of specific performance metrics makes it hard to assess value for money.
No indication of small business participation.

Positive Signals

Awarded under full and open competition, suggesting a competitive process.
Contract awarded to a reputable defense contractor.
Clear identification of service type (Engineering Services).

Sector Analysis

Engineering services are crucial for the Department of Defense's research, development, and maintenance activities. Spending in this sector can vary significantly based on defense priorities and technological advancements. Benchmarking requires comparison with similar specialized engineering support contracts.

Small Business Impact

There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. This suggests a focus on large, established defense contractors for this particular service requirement.

Oversight & Accountability

The Department of the Navy is responsible for oversight of this contract. The CPFF structure requires diligent monitoring of costs and performance to ensure accountability and prevent waste.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Potential for cost overruns due to CPFF structure.
Lack of transparency on specific services rendered and their direct impact.
No clear indication of small business utilization.
Long contract duration may not be optimal for rapidly evolving technological needs.
Limited information on performance metrics and value achieved.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $43.6 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC.. IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES 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 $43.6 million.

What is the period of performance?

Start: 2015-06-08. End: 2020-12-31.

What specific engineering services were provided under this contract, and how did they contribute to the Department of the Navy's mission objectives?

The contract falls under NAICS code 541330 for Engineering Services. While specific details are not provided, these services typically encompass design, analysis, testing, and technical support for naval systems and platforms. The contribution would be tied to specific projects or operational requirements of the Navy, potentially including R&D, system upgrades, or maintenance planning.

How effectively was the 'full and open competition' process managed to ensure the best possible price and value for taxpayers?

Full and open competition generally promotes price discovery. However, the effectiveness depends on the clarity of the solicitation, the number and quality of bids received, and the evaluation criteria used. Without access to the solicitation details and bid outcomes, it's difficult to definitively assess the price discovery impact beyond the initial competitive award.

What measures were in place to control costs and ensure efficiency given the Cost Plus Fixed Fee (CPFF) contract structure?

CPFF contracts require robust oversight mechanisms. The Department of the Navy would typically implement measures such as detailed cost audits, performance reviews, and negotiation of the fixed fee based on realistic cost projections. Effective management involves ensuring that the contractor is incentivized to control costs while delivering the required services within the agreed-upon scope.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002413R3078

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Compagnie DE Developpement DE L'eau S.A.

Address: 520 GAITHER ROAD, ROCKVILLE, MD, 20850

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $77,015,362

Exercised Options: $69,820,300

Current Obligation: $43,624,122

Subaward Activity

Number of Subawards: 57

Total Subaward Amount: $24,047,370

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4018

IDV Type: IDC

Timeline