DoD's $62.8M Engineering Services Contract Awarded to Systems Planning and Analysis, Inc. with No Competition

Contract Overview

Contract Amount: $62,868,821 ($62.9M)

Contractor: Systems Planning and Analysis, Inc.

Awarding Agency: Department of Defense

Start Date: 2018-10-01

End Date: 2024-04-14

Contract Duration: 2,022 days

Daily Burn Rate: $31.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: REPORTED FOR ADMINISTRATIVE PURPOSES. CLINS 0001, 1001, 2005, 30005, AND 4005 ARE NON-SEVERABLE AND CONTAIN UK NON-FMS FUNDS. CANNOT DIVIDE IN SYSTEM. AMOUNT INCLUDED IN TRANSACTION 4.

Place of Performance

Location: WASHINGTON NAVY YARD, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20374

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $62.9 million to SYSTEMS PLANNING AND ANALYSIS, INC. for work described as: REPORTED FOR ADMINISTRATIVE PURPOSES. CLINS 0001, 1001, 2005, 30005, AND 4005 ARE NON-SEVERABLE AND CONTAIN UK NON-FMS FUNDS. CANNOT DIVIDE IN SYSTEM. AMOUNT INCLUDED IN TRANSACTION 4. Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, which can lead to cost overruns if not managed carefully. 2. The contract has a long performance period, spanning over five years, increasing the potential for scope creep and cost escalation. 3. Lack of competition raises concerns about whether the government secured the best possible price and value. 4. The contract is for engineering services, a critical but often complex area where performance can be difficult to measure. 5. The awardee, Systems Planning and Analysis, Inc., has a history of government contracts, suggesting some level of established capability. 6. The contract's value is substantial, indicating a significant investment in engineering support for the Department of the Navy.

Value Assessment

Rating: questionable

The contract's cost-plus-fixed-fee structure, combined with a lack of competition, makes a definitive value assessment difficult without further data on the fixed fee and the actual costs incurred. Benchmarking against similar engineering services contracts, especially those competed openly, would be necessary to determine if the pricing is competitive. The long duration and the non-severable nature of the CLINs suggest a complex scope that could be prone to cost growth, impacting overall value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning there was no open competition. The specific justification for this approach is not provided in the data. Sole-source awards can limit price discovery and may not always result in the most cost-effective outcome for the government, as potential savings from competitive bidding are forgone.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure to drive down costs. Without a competitive process, it is harder to ensure that the government is receiving the best value for its investment.

Public Impact

The Department of the Navy benefits from specialized engineering services to support its operations and acquisition programs. The contract likely supports critical defense initiatives and the development or maintenance of naval systems. The geographic impact is primarily within the District of Columbia, where the contractor is located, but the services could support naval activities nationwide or globally. The contract may indirectly impact the defense industrial workforce by providing work for Systems Planning and Analysis, Inc. and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost-plus-fixed-fee contracts carry inherent risks of cost overruns.
Long contract duration increases the potential for scope creep and budget unpredictability.
Performance metrics and oversight are crucial for ensuring value in sole-source awards.

Positive Signals

Awardee has experience in government contracting.
Engineering services are vital for complex defense systems.
Contract is for administrative purposes, suggesting a need for structured support.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the broader professional, scientific, and technical services industry. This sector supports government agencies with specialized expertise in design, analysis, and project management. The market for defense engineering services is substantial, with significant government spending allocated to ensure technological superiority and operational readiness. Comparable spending benchmarks would typically involve analyzing other sole-source or competed engineering contracts within the Department of Defense for similar scope and duration.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it explicitly mention subcontracting plans for small businesses. This suggests that the primary awardee is likely a larger entity, and the contract's direct impact on the small business ecosystem may be limited unless significant subcontracting opportunities arise. Further investigation into subcontracting clauses would be needed to fully assess the impact on small businesses.

Oversight & Accountability

Oversight mechanisms for this contract would typically involve the Department of the Navy's contracting officers and program managers. Accountability measures would be tied to the terms of the Cost Plus Fixed Fee (CPFF) contract, requiring the contractor to adhere to the scope of work and manage costs within the agreed-upon fixed fee. Transparency is often limited in sole-source awards, but contract modifications, performance reports, and financial audits would be subject to standard government oversight procedures. The Inspector General's office may also have jurisdiction for audits and investigations.

Related Government Programs

Department of Defense Engineering Services Contracts
Naval Systems Engineering Support
Cost-Plus-Fixed-Fee Contracts
Sole-Source Defense Acquisitions
Professional, Scientific, and Technical Services

Risk Flags

Sole-source award lacks competitive transparency.
Cost-plus-fixed-fee structure carries inherent cost overrun risk.
Long contract duration increases potential for budget unpredictability.
Complex funding (UK non-FMS) may introduce compliance risks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $62.9 million to SYSTEMS PLANNING AND ANALYSIS, INC.. REPORTED FOR ADMINISTRATIVE PURPOSES. CLINS 0001, 1001, 2005, 30005, AND 4005 ARE NON-SEVERABLE AND CONTAIN UK NON-FMS FUNDS. CANNOT DIVIDE IN SYSTEM. AMOUNT INCLUDED IN TRANSACTION 4.

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 (Department of the Navy).

What is the total obligated amount?

The obligated amount is $62.9 million.

What is the period of performance?

Start: 2018-10-01. End: 2024-04-14.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are awarded when only one responsible source can provide the required supplies or services, or in cases of urgent and compelling need. Without the official justification document (e.g., a Justification and Approval - J&A), it is impossible to determine the rationale. This lack of transparency is a common concern with sole-source procurements, as it prevents public scrutiny of the decision-making process and limits the ability to verify if competition was truly not feasible or in the government's best interest.

How does the fixed fee in this Cost Plus Fixed Fee (CPFF) contract compare to industry standards for similar engineering services?

Determining the competitiveness of the fixed fee requires detailed information not present in the summary data, such as the total estimated cost, the specific services rendered, and the contractor's overhead structure. CPFF contracts aim to provide the contractor with a reasonable profit (the fixed fee) while covering all allowable costs. Benchmarking this fee against similar, competed contracts or industry data for engineering services of comparable complexity and risk would be necessary. A high fixed fee relative to the estimated costs or the scope of work could indicate a less favorable deal for the government, especially in the absence of competition.

What are the key performance indicators (KPIs) and how is performance being measured for this contract?

The provided data does not specify the key performance indicators (KPIs) or the methods used to measure the performance of Systems Planning and Analysis, Inc. under this contract. For a CPFF contract, especially one awarded sole-source, robust performance metrics are crucial for ensuring accountability and value. These KPIs would typically be outlined in the contract's Performance Work Statement (PWS) and could include metrics related to technical accuracy, timeliness of deliverables, adherence to budget, and overall customer satisfaction. Without visibility into these KPIs and the measurement process, assessing the contractor's effectiveness and the contract's success is challenging.

What is the historical spending pattern for this type of engineering service within the Department of the Navy?

The provided data focuses on a single contract award. To understand historical spending patterns for similar engineering services within the Department of the Navy, one would need to analyze procurement data over several fiscal years. This would involve identifying contracts with similar North American Industry Classification System (NAICS) codes (like 541330 for Engineering Services), contract types (CPFF, FFP, etc.), and agencies (Department of the Navy). Analyzing trends in contract values, competition levels, and awardees would reveal whether this $62.8 million sole-source award is an anomaly or part of a broader pattern of spending in this category.

What is the potential risk associated with the non-severable nature of the CLINs and the use of UK non-FMS funds?

The mention of 'non-severable' CLINs and 'UK non-FMS funds' suggests a complex financial and programmatic structure. Non-severable CLINs mean the work cannot be broken down into smaller, independently deliverable parts, which can complicate contract management and payment schedules. The use of 'UK non-FMS funds' implies funding sources related to the United Kingdom's non-Foreign Military Sales program, which may have specific regulatory, reporting, and oversight requirements distinct from standard US federal appropriations. This complexity increases administrative burden and potential for compliance risks, requiring careful management to ensure funds are used appropriately and according to any associated international agreements or regulations.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0003018R0032

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: $73,267,661

Exercised Options: $73,267,661

Current Obligation: $62,868,821

Actual Outlays: $6,227,065

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $545,487

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline