DoD's $15.4M Weapon Overhaul Contract Awarded to Science Applications International Corp

Contract Overview

Contract Amount: $15,444,448 ($15.4M)

Contractor: Science Applications International Corporation

Awarding Agency: Department of Defense

Start Date: 2019-12-23

End Date: 2027-07-21

Contract Duration: 2,767 days

Daily Burn Rate: $5.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: WEAPON OVERHAUL&REPAIR NON-PERSONAL SERVICES (JXN).

Place of Performance

Location: CRANE, MARTIN County, INDIANA, 47522

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $15.4 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: WEAPON OVERHAUL&REPAIR NON-PERSONAL SERVICES (JXN). Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of over 7 years indicates a long-term need for these services. 3. The use of a Cost Plus Fixed Fee (CPFF) pricing structure requires careful monitoring to manage costs. 4. The contract is for non-personal services, meaning the contractor provides expertise rather than personnel. 5. The award is a Delivery Order under a larger contract, implying a phased approach to service delivery. 6. The contract is managed by the Department of the Navy, a major component of the DoD.

Value Assessment

Rating: fair

Benchmarking the value of this $15.4 million contract is challenging without specific performance metrics or comparable contract data. The Cost Plus Fixed Fee (CPFF) structure can lead to cost overruns if not managed diligently, potentially impacting value for money. However, the duration suggests a recognized need for these engineering services. Further analysis would require understanding the specific weapon systems involved and the scope of the overhaul and repair work.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders were likely considered. The presence of two bids suggests a moderate level of competition for this specific delivery order. While full and open competition is generally preferred for price discovery, the actual number of bidders can influence the competitiveness of the pricing. A higher number of bids typically leads to more competitive pricing.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing due to the full and open competition. However, the ultimate value depends on the efficiency and cost control exercised by the contractor under the CPFF structure.

Public Impact

The Department of Defense, specifically the Department of the Navy, benefits from the overhaul and repair of weapon systems, ensuring operational readiness. Services delivered include engineering expertise for weapon system maintenance and upgrades. The contract's performance location is listed as Indiana, suggesting a geographic concentration of work. The contract is for non-personal services, implying the workforce implications are primarily for the contractor's engineering staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) pricing can incentivize cost overruns if not closely monitored.
Long contract duration (over 7 years) increases the risk of scope creep or evolving requirements.
Limited competition (2 bids) may have resulted in less favorable pricing than a more robust competition.
The specific weapon systems being overhauled are not detailed, making it difficult to assess the complexity and associated risks.

Positive Signals

Awarded through full and open competition, which generally promotes competitive pricing.
The contract addresses a critical need for weapon system maintenance and readiness within the Navy.
The contractor, Science Applications International Corporation, is a large and established defense contractor with significant experience.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), a critical component of the defense industrial base. The defense engineering services market is substantial, driven by the continuous need for maintenance, modernization, and upgrades of complex military equipment. Spending in this sector is often characterized by long-term contracts, specialized expertise, and significant government oversight due to the sensitive nature of the work. Comparable spending benchmarks would involve analyzing other large overhaul and repair contracts for naval or other military platforms.

Small Business Impact

This contract does not appear to have a small business set-aside (ss=false, sb=false). There is no explicit information provided regarding subcontracting plans for small businesses. Without this data, it's difficult to assess the direct impact on the small business ecosystem. Large prime contractors are often encouraged or required to subcontract portions of their work to small businesses, but the extent of this is not detailed here.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. The Cost Plus Fixed Fee (CPFF) structure necessitates robust financial oversight to ensure costs are reasonable and allocable. Transparency is typically managed through contract reporting mechanisms and performance reviews. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Maintenance and Repair Contracts
Naval Weapon System Modernization Programs
Engineering Services for Defense Platforms
Defense Logistics Agency Support Contracts

Risk Flags

Cost Plus Fixed Fee (CPFF) pricing structure requires diligent oversight to prevent cost overruns.
Long contract duration increases the risk of scope creep and potential for outdated requirements.
Limited number of bids (2) may indicate reduced competition, potentially impacting price.
Lack of detailed scope of work makes it difficult to fully assess complexity and associated risks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.4 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. WEAPON OVERHAUL&REPAIR NON-PERSONAL SERVICES (JXN).

Who is the contractor on this award?

The obligated recipient is SCIENCE APPLICATIONS INTERNATIONAL CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $15.4 million.

What is the period of performance?

Start: 2019-12-23. End: 2027-07-21.

What is the track record of Science Applications International Corporation (SAIC) with similar Cost Plus Fixed Fee (CPFF) contracts within the Department of Defense?

Science Applications International Corporation (SAIC) has a extensive history of performing complex engineering and technical services for the Department of Defense (DoD), often utilizing various contract types including Cost Plus Fixed Fee (CPFF). SAIC's experience spans a wide range of defense programs, from IT modernization to weapon systems support. For CPFF contracts specifically, their performance is generally characterized by their ability to manage large, intricate projects. However, like any large contractor, past performance reviews and specific contract close-outs would reveal detailed insights into their cost control effectiveness and adherence to budget on prior CPFF engagements. Analyzing their historical data on cost variances, award fees, and any incurred penalties or incentives on similar contracts would provide a clearer picture of their reliability in managing costs under this pricing structure for the DoD.

How does the $15.4 million value of this contract compare to other weapon overhaul and repair contracts awarded by the Department of the Navy?

The $15.4 million value for this specific delivery order falls within a moderate range for weapon overhaul and repair services within the Department of the Navy (DoN). The DoN frequently awards larger, multi-year contracts for major platform overhauls, modernization programs, and sustainment efforts that can range from tens of millions to billions of dollars. This particular award, being a delivery order under a potentially larger indefinite-delivery/indefinite-quantity (IDIQ) contract, suggests it represents a specific phase or set of tasks. When compared to the overall spending on naval aviation, surface combatants, or submarine maintenance, $15.4 million is a significant but not exceptionally large sum. Benchmarking would require identifying contracts with similar scopes of work (e.g., specific weapon systems, types of repair) and durations to provide a more precise comparison of value.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for weapon overhaul and repair services?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract for weapon overhaul and repair services is the potential for cost overruns, which can negatively impact the overall value for money. In a CPFF structure, the contractor is reimbursed for allowable costs plus a predetermined fixed fee. This can create an incentive for the contractor to incur higher costs, as their fee remains constant regardless of the actual expenses. For the government, this necessitates rigorous oversight of allowable costs, detailed auditing, and strong program management to ensure that expenditures are reasonable, allocable, and necessary for the scope of work. Scope creep, where the project's requirements expand beyond the initial agreement without corresponding adjustments to the fee or schedule, also poses a significant risk. Effective risk mitigation involves clear contract language, detailed work breakdown structures, and proactive communication between the government and the contractor.

How effective is full and open competition in ensuring competitive pricing for specialized engineering services like weapon system overhaul?

Full and open competition is generally the most effective method for ensuring competitive pricing for specialized engineering services, including weapon system overhaul. By allowing all responsible sources to submit proposals, it maximizes the pool of potential bidders, thereby increasing the likelihood of receiving competitive offers. This broad competition drives down prices as contractors vie for the award. However, the effectiveness is contingent on several factors: the clarity and completeness of the government's solicitation (e.g., Statement of Work), the number of qualified bidders that actually respond, and the complexity of the technical requirements which might limit the number of capable firms. For highly specialized services, the number of truly qualified bidders might be limited, even under full and open competition, potentially moderating the price competition.

What are the implications of the contract's 2767-day duration (approx. 7.5 years) for long-term weapon system readiness and budget planning?

A contract duration of approximately 7.5 years for weapon overhaul and repair has significant implications for both long-term weapon system readiness and federal budget planning. For readiness, such a long-term commitment ensures sustained support and maintenance for critical assets, preventing degradation and maintaining operational capability over an extended period. This continuity is vital for complex weapon systems that require specialized, ongoing attention. From a budget planning perspective, a long-term contract provides predictability, allowing the Department of Defense to allocate funds more effectively over multiple fiscal years. However, it also ties up significant resources and requires careful management to ensure that the scope remains relevant and costs are controlled throughout the contract's life. Flexibility to adapt to technological advancements or changing strategic needs within such a long-term agreement is also a key consideration.

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: N0016419R3513

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 12010 SUNSET HILLS RD, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $18,574,421

Exercised Options: $18,574,421

Current Obligation: $15,444,448

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017819D8470

IDV Type: IDC

Timeline