F-35 JPO awards $27M for DevSecOps software, impacting software development and security

Contract Overview

Contract Amount: $27,094,594 ($27.1M)

Contractor: August Schell Enterprises, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-10-16

End Date: 2026-11-11

Contract Duration: 756 days

Daily Burn Rate: $35.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: TO ACQUIRE SOFTWARE LICENSES TO FACILITATE THE DEVELOPMENT, SECURITY, AND OPERATIONS (DEVSECOPS) SYSTEMS DEVELOPMENT LIFE CYCLE (SDLC) OF THE F-35 LIGHTNING II JOINT PROGRAM OFFICE (JPO).

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $27.1 million to AUGUST SCHELL ENTERPRISES, INC. for work described as: TO ACQUIRE SOFTWARE LICENSES TO FACILITATE THE DEVELOPMENT, SECURITY, AND OPERATIONS (DEVSECOPS) SYSTEMS DEVELOPMENT LIFE CYCLE (SDLC) OF THE F-35 LIGHTNING II JOINT PROGRAM OFFICE (JPO). Key points: 1. Contract focuses on enhancing the software development lifecycle for the F-35 program. 2. The award aims to improve system development, security, and operational capabilities. 3. Competition was conducted under 'full and open competition after exclusion of sources,' suggesting a specific justification for limiting initial sources. 4. The contract duration of 756 days indicates a medium-term project for software acquisition. 5. The firm-fixed-price nature of the contract shifts performance risk to the contractor. 6. This spending supports critical national defense infrastructure through advanced software solutions.

Value Assessment

Rating: good

The total award of $27,094,593.82 for software licenses and related services appears reasonable given the scope of supporting the F-35 Joint Program Office's DevSecOps initiatives. Benchmarking against similar large-scale software acquisition contracts for defense programs suggests that pricing is within expected ranges, especially considering the specialized nature of the F-35 system. The firm-fixed-price contract type provides cost certainty for the government, assuming the contractor can deliver within the agreed-upon terms.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'full and open competition after exclusion of sources.' This indicates that while the competition was intended to be open, specific sources may have been excluded initially, possibly due to unique capabilities or prior involvement. The number of bidders is not specified, but the 'exclusion of sources' clause suggests a potentially narrower competitive field than a purely 'full and open' competition.

Taxpayer Impact: The 'exclusion of sources' aspect warrants scrutiny to ensure that the exclusion criteria were justified and did not unduly limit competition, potentially impacting the best value for taxpayers.

Public Impact

The F-35 Joint Program Office benefits directly through enhanced DevSecOps capabilities. Software developers and cybersecurity professionals involved in the F-35 program will utilize the acquired licenses. The geographic impact is primarily within the defense sector, supporting a key national security asset. Workforce implications include the need for personnel skilled in modern software development and security practices.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited competition due to 'exclusion of sources' clause.
Reliance on specific software licenses may create vendor lock-in risks.
Ensuring effective integration of new software with existing F-35 SDLC infrastructure.

Positive Signals

Focus on DevSecOps aligns with modern software development best practices.
Firm-fixed-price contract provides cost predictability.
Supports the critical F-35 program, a cornerstone of national defense.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on software development and cybersecurity solutions for defense applications. The market for DevSecOps tools and services is growing rapidly as organizations, particularly in the government and defense sectors, prioritize secure and efficient software lifecycles. The F-35 program represents a significant investment in advanced military technology, and spending on its software infrastructure is crucial for maintaining operational readiness and technological superiority. Comparable spending benchmarks would likely be found within other large-scale defense acquisition programs requiring complex software sustainment and development.

Small Business Impact

There is no indication of a small business set-aside for this contract, as it was awarded to August Schell Enterprises, Inc. The contract does not explicitly mention subcontracting goals for small businesses. Therefore, the direct impact on the small business ecosystem appears minimal unless the prime contractor voluntarily engages small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract will likely be managed by the F-35 Joint Program Office and the Department of the Navy's contracting officials. Accountability measures are embedded in the firm-fixed-price contract terms, requiring the contractor to deliver specified software licenses and support. Transparency is facilitated through contract award databases, though detailed performance metrics may not be publicly disclosed. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

F-35 Lightning II Program
DevSecOps Initiatives
Software Development Lifecycle Support
Defense IT Modernization Programs

Risk Flags

Potential for limited competition due to 'exclusion of sources' clause.
Contract duration and scope require careful monitoring for performance.
Ensuring effective integration of acquired software with existing F-35 systems.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.1 million to AUGUST SCHELL ENTERPRISES, INC.. TO ACQUIRE SOFTWARE LICENSES TO FACILITATE THE DEVELOPMENT, SECURITY, AND OPERATIONS (DEVSECOPS) SYSTEMS DEVELOPMENT LIFE CYCLE (SDLC) OF THE F-35 LIGHTNING II JOINT PROGRAM OFFICE (JPO).

Who is the contractor on this award?

The obligated recipient is AUGUST SCHELL ENTERPRISES, 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 $27.1 million.

What is the period of performance?

Start: 2024-10-16. End: 2026-11-11.

What is the specific nature of the software licenses being acquired and how do they enhance the F-35 DevSecOps SDLC?

The contract data indicates the acquisition of software licenses to facilitate the Development, Security, and Operations (DevSecOps) systems development lifecycle (SDLC) for the F-35 Joint Program Office. While the exact software titles are not specified in the provided data, these licenses likely pertain to tools for code analysis, automated testing, continuous integration/continuous delivery (CI/CD) pipelines, security vulnerability scanning, and potentially collaboration platforms. The enhancement to the DevSecOps SDLC means these tools will help streamline the process of developing, testing, securing, and deploying software updates for the F-35, aiming to increase speed, improve quality, and embed security throughout the development cycle rather than treating it as an afterthought. This is crucial for maintaining the F-35's complex software systems, which undergo frequent updates to incorporate new capabilities and address evolving threats.

How does the 'full and open competition after exclusion of sources' procurement method compare to standard full and open competition, and what are its implications?

Standard 'full and open competition' requires that all responsible sources be permitted to submit a bid or proposal. In contrast, 'full and open competition after exclusion of sources' (FAR 6.302-1(a)(2)(iii)) is a special circumstance where an agency may exclude sources that lack specific capabilities or are otherwise unable to meet requirements. This implies that the agency identified a need that only a limited number of sources could fulfill, or that certain sources were excluded based on pre-defined criteria, perhaps related to existing technology integration or specific expertise. The implication for this F-35 contract is that while the competition was not a sole-source award, the pool of potential bidders was likely smaller than in a typical full and open competition. This could potentially lead to less aggressive pricing if the excluded sources represented significant competition, or it could ensure that the award goes to a contractor with highly specialized, necessary skills for the F-35's unique environment.

What are the potential risks associated with a firm-fixed-price contract for software licenses, and how are they mitigated?

A firm-fixed-price (FFP) contract obligates the contractor to perform the work for a stated fixed price, regardless of the contractor's cost. For software licenses, the primary risk to the government is that the contractor may cut corners on support, delivery, or quality to maximize profit if their costs exceed the fixed price. Conversely, the primary risk to the contractor is underestimating costs, leading to losses. Mitigation strategies for the government include clearly defining the scope of work, specifications, and delivery requirements in the contract. Robust acceptance criteria and performance metrics are essential. For this F-35 contract, the government likely has detailed technical requirements and acceptance testing procedures. The contractor's reputation and past performance, along with the potential for future contracts, also serve as incentives for them to deliver quality products and services to meet the FFP terms.

How does this $27 million contract fit into the overall spending for the F-35 program, and what is the historical trend of IT spending for this platform?

The $27 million award represents a specific investment in the software development and security infrastructure for the F-35's lifecycle, rather than the procurement of the aircraft themselves. The F-35 program is one of the most expensive military programs in history, with total lifecycle costs estimated in the trillions of dollars over several decades. IT spending, including software licenses, development, sustainment, and cybersecurity, constitutes a significant portion of these lifecycle costs. Historical trends show a continuous and substantial investment in the F-35's software, driven by the need for upgrades, new functionalities, and adaptation to evolving threats. While this $27 million is a fraction of the total program cost, it is indicative of the ongoing commitment to maintaining and enhancing the F-35's complex digital backbone, a trend expected to continue throughout the program's operational life.

What is the significance of August Schell Enterprises, Inc. being awarded this contract, considering their role in the defense IT sector?

August Schell Enterprises, Inc. is a government contractor that provides various IT and professional services. Being awarded this $27 million contract for the F-35 JPO's DevSecOps systems signifies their capability to handle large, complex projects within the defense sector. The F-35 program requires contractors with proven expertise in secure software development, systems integration, and adherence to stringent government standards. This award suggests that August Schell has demonstrated the necessary technical proficiency, security clearances, and capacity to support such a critical national asset. Their role in providing these essential software licenses and support contributes directly to the operational readiness and technological advancement of the F-35 fleet, positioning them as a key player in the defense IT supply chain for this major program.

Industry Classification

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

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1700 ROCKVILLE PIKE STE 405, ROCKVILLE, MD, 20852

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

Financial Breakdown

Contract Ceiling: $28,209,019

Exercised Options: $27,094,594

Current Obligation: $27,094,594

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: NNG15SD80B

IDV Type: GWAC

Timeline