DoD's $24.8M contract for systems engineering and analysis support awarded to Systems Planning and Analysis, Inc. without competition

Contract Overview

Contract Amount: $24,764,957 ($24.8M)

Contractor: Systems Planning and Analysis, Inc.

Awarding Agency: Department of Defense

Start Date: 2010-10-01

End Date: 2013-09-01

Contract Duration: 1,066 days

Daily Burn Rate: $23.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: SYSTEMS ENGINEERING AND ANALYSIS SUPPORT- UK FUNDING

Place of Performance

Location: ALEXANDRIA, ALEXANDRIA CITY County, VIRGINIA, 22311

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $24.8 million to SYSTEMS PLANNING AND ANALYSIS, INC. for work described as: SYSTEMS ENGINEERING AND ANALYSIS SUPPORT- UK FUNDING Key points: 1. The contract's value of $24.8 million over three years represents a significant investment in specialized engineering and analysis. 2. Awarded on a sole-source basis, the lack of competition raises questions about potential overpricing and limited market engagement. 3. The contract duration of 1066 days (approx. 3 years) suggests a need for sustained support in complex defense systems. 4. The 'Cost Plus Fixed Fee' pricing structure can incentivize cost overruns if not closely monitored. 5. Performance was managed by the Defense Contract Management Agency, indicating a focus on defense-related acquisition oversight. 6. The contract's classification as 'NOT COMPETED' is a key risk indicator, potentially limiting taxpayer value. 7. The North American Industry Classification System (NAICS) code 541330 points to engineering services, a critical component of defense procurement.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature and the specific, potentially unique, services provided. Without competitive bids, it's difficult to ascertain if the $24.8 million represents a fair market price. The 'Cost Plus Fixed Fee' (CPFF) contract type, while common for complex R&D or services where costs are uncertain, carries inherent risks of cost escalation. The fixed fee component aims to provide the contractor with an incentive to control costs, but the overall cost is still subject to variation. A comparison to similar sole-source contracts for specialized systems engineering and analysis within the DoD would be necessary for a more robust value assessment, but such data is not readily available.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This typically occurs when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The absence of competition means there was no direct price discovery through a bidding process, which can potentially lead to higher costs for the government compared to a fully competed contract. The rationale for sole-source awards is usually documented, often citing reasons like urgency, lack of alternatives, or national security concerns.

Taxpayer Impact: For taxpayers, a sole-source award means that the government did not leverage the power of competition to drive down prices. This can result in a higher overall expenditure for the services rendered, as the contractor may not have had the same pressure to offer the most cost-effective solution.

Public Impact

The primary beneficiaries are likely the Department of Defense agencies requiring specialized systems engineering and analysis support for complex defense platforms. The services delivered are crucial for the design, development, integration, and sustainment of advanced military systems. The geographic impact is primarily within the United States, supporting defense operations and technological advancement. The contract supports a highly skilled workforce in engineering, systems analysis, and related technical fields.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to suboptimal pricing and reduced value for taxpayer funds.
Cost Plus Fixed Fee contracts can incentivize cost overruns if not rigorously managed.
Sole-source awards can create a dependency on a single contractor, limiting future flexibility.
The specific nature of 'systems engineering and analysis support' can be broad, potentially leading to scope creep if not clearly defined.

Positive Signals

The contractor, Systems Planning and Analysis, Inc., likely possesses specialized expertise critical to the DoD's mission.
The sustained nature of the contract (over 3 years) suggests a stable and ongoing requirement for these services.
The award by the Department of Defense indicates the strategic importance of the services provided.

Sector Analysis

The engineering services sector, particularly within defense, is characterized by high technical barriers to entry and significant government spending. NAICS code 541330, Engineering Services, encompasses a broad range of activities, including systems engineering, design, and consulting. The defense industry relies heavily on specialized engineering firms to develop and maintain complex weapon systems and platforms. Spending in this sector is often driven by national security priorities and technological advancements. Comparable spending benchmarks are difficult to establish for sole-source contracts due to the lack of transparent pricing data from competitive processes.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the contract was awarded on a sole-source basis, which typically bypasses the standard competitive processes where small business set-asides are most common. There is no explicit information regarding subcontracting plans for small businesses. Without a set-aside or a strong subcontracting requirement, the direct impact on the small business ecosystem for this specific contract is likely minimal, though the prime contractor may engage small businesses as part of their supply chain.

Oversight & Accountability

Oversight for this contract would fall under the purview of the Department of Defense, likely managed by the Defense Contract Management Agency (DCMA) given the 'sa' field. Accountability measures would be tied to the contract's performance work statement and the 'Cost Plus Fixed Fee' structure, requiring detailed cost reporting and progress monitoring. Transparency is generally limited for sole-source contracts, especially in the defense sector, though contract awards are publicly reported. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Defense Systems Engineering Support
Aerospace Engineering Services
Naval Systems Analysis
Command and Control Systems Development
Military Technology Research and Development

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Lack of publicly available detailed performance metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.8 million to SYSTEMS PLANNING AND ANALYSIS, INC.. SYSTEMS ENGINEERING AND ANALYSIS SUPPORT- UK FUNDING

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $24.8 million.

What is the period of performance?

Start: 2010-10-01. End: 2013-09-01.

What specific systems or platforms does this contract support?

The provided data does not specify the exact defense systems or platforms that Systems Planning and Analysis, Inc. is supporting under this contract. The description 'SYSTEMS ENGINEERING AND ANALYSIS SUPPORT' is broad and could encompass a wide range of activities related to the design, development, integration, testing, and sustainment of various military hardware and software. To determine the specific systems, one would need to consult the contract's Statement of Work (SOW) or related documentation, which are typically not publicly available in full detail. This information is crucial for understanding the strategic importance and technical scope of the contract.

Why was this contract awarded on a sole-source basis?

The data indicates this contract was 'NOT COMPETED' and awarded on a 'sole-source' basis. The specific justification for this sole-source award is not provided in the abbreviated data. Common reasons for sole-source awards in defense contracting include the unique capabilities of the contractor, the existence of proprietary technology, urgent and compelling needs where competition is not feasible, or if the contract is a follow-on to a previous sole-source award where the original contractor is the only viable option. A formal justification document, often required by federal acquisition regulations, would detail the rationale behind this decision.

How does the 'Cost Plus Fixed Fee' (CPFF) pricing structure impact cost control?

The 'Cost Plus Fixed Fee' (CPFF) pricing structure means the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. While the fixed fee provides some incentive for the contractor to control costs (as their profit is capped), the government bears the risk of cost overruns if actual costs exceed estimates. Effective cost control under CPFF relies heavily on robust government oversight, detailed cost tracking, and rigorous auditing of incurred expenses. Without strong management, this contract type can lead to higher overall expenditures than fixed-price contracts.

What is the historical spending trend for Systems Planning and Analysis, Inc. with the Department of Defense?

The provided data only details one specific contract awarded to Systems Planning and Analysis, Inc. (SPA) for $24.8 million from 2010 to 2013. To understand historical spending trends, a broader search of federal procurement databases (like USASpending.gov or FPDS) would be necessary to identify all contracts awarded to SPA by the DoD and other federal agencies over a longer period. This would reveal patterns in contract types, agencies served, and the overall volume of business, providing context for SPA's role and performance within the defense industrial base.

What are the potential risks associated with a sole-source contract of this magnitude?

The primary risks associated with a sole-source contract of this magnitude ($24.8 million) include: 1) Lack of Price Competition: The government may pay a higher price than if the contract were competed. 2) Reduced Innovation: Without competitive pressure, the contractor may have less incentive to innovate or offer more efficient solutions. 3) Contractor Lock-in: The government can become dependent on the sole-source provider, potentially limiting future options and flexibility. 4) Potential for Scope Creep: If the contract's scope is not tightly managed, costs can increase significantly. 5) Limited Transparency: Sole-source awards often have less public scrutiny compared to competed contracts.

Industry Classification

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

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

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: $27,331,992

Exercised Options: $25,403,882

Current Obligation: $24,764,957

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline