DoD's $10.6M contract for microelectronics engineering support awarded to Amentum Services, Inc

Contract Overview

Contract Amount: $10,585,489 ($10.6M)

Contractor: Amentum Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-03-13

End Date: 2026-09-30

Contract Duration: 931 days

Daily Burn Rate: $11.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: BUSINESS OPERATIONS AND ENGINEERING SUPPORT SERVICES REQUIREMENTS IN SUPPORT OF THE MICROELECTRONICS DIVISION (CODE GXV) AT NAVAL SURFACE WARFARE CENTER (NSWC) CRANE.

Place of Performance

Location: CRANE, MARTIN County, INDIANA, 47522

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $10.6 million to AMENTUM SERVICES, INC. for work described as: BUSINESS OPERATIONS AND ENGINEERING SUPPORT SERVICES REQUIREMENTS IN SUPPORT OF THE MICROELECTRONICS DIVISION (CODE GXV) AT NAVAL SURFACE WARFARE CENTER (NSWC) CRANE. Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee (CPFF), which can incentivize cost control but also carries risk. 3. Performance period spans over 2.5 years, indicating a medium-term need for these services. 4. The contract is a delivery order under a larger IDIQ, suggesting it's part of a broader procurement strategy. 5. The specific NAICS code (541330) points to engineering services, a critical component for advanced technology development. 6. The contract is not set aside for small businesses, implying a focus on large, capable contractors.

Value Assessment

Rating: fair

The contract's Cost Plus Fixed Fee (CPFF) structure requires careful monitoring to ensure value for money. While this structure allows for flexibility in complex projects, it can lead to cost overruns if not managed diligently. Benchmarking against similar engineering support contracts for defense agencies is necessary to assess if the fixed fee and estimated costs are competitive. Without detailed cost breakdowns and performance metrics, a definitive value assessment is challenging.

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 had the opportunity to submit proposals. The number of bidders is not specified, but this approach generally fosters price discovery and allows the government to select the most advantageous offer. The competitive nature should theoretically lead to more favorable pricing and better service offerings.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best value for the government's investment in critical microelectronics engineering support.

Public Impact

The primary beneficiaries are the Naval Surface Warfare Center (NSWC) Crane's Microelectronics Division, which receives essential engineering support. Services delivered include business operations and engineering support, crucial for advancing microelectronics technology. The geographic impact is centered around NSWC Crane in Indiana, supporting a key defense research and development hub. Workforce implications may include the need for specialized engineers and technical staff, potentially benefiting the local Indiana economy and the broader defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

CPFF contracts can lead to cost escalation if not tightly managed.
Lack of specific performance metrics makes it difficult to gauge efficiency.
Reliance on a single delivery order under an IDIQ might limit long-term strategic planning visibility.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
Supports critical microelectronics research and development for national security.
Long-term performance period suggests sustained need and potential for stable support.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting advanced microelectronics. The defense sector's demand for specialized engineering is high, driven by the need for technological superiority. Comparable spending benchmarks would involve looking at other contracts for R&D support, systems engineering, and specialized technical services within DoD, particularly those related to semiconductor and microelectronics development.

Small Business Impact

The contract was not set aside for small businesses, indicating that the scope and requirements were likely geared towards larger firms with extensive capabilities in engineering and defense support. This suggests that subcontracting opportunities for small businesses may exist, but they would depend on the prime contractor's strategy and the specific needs of the project. The absence of a small business set-aside means direct prime contract awards to small businesses are not a feature of this specific procurement.

Oversight & Accountability

Oversight for this contract will likely be managed by the Naval Surface Warfare Center (NSWC) Crane contracting and program management offices. Accountability measures will be tied to the Cost Plus Fixed Fee (CPFF) terms, requiring detailed cost reporting and performance reviews. Transparency is facilitated through the contract award process and potential reporting requirements, though specific details on public transparency are not provided. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval Surface Warfare Center (NSWC) Contracts
Microelectronics Research and Development Programs
Department of Defense Engineering Services
Cost Plus Fixed Fee Contracts
IDIQ Contract Vehicles

Risk Flags

Cost Plus Fixed Fee (CPFF) contract type requires diligent oversight to manage costs.
Potential for scope creep in R&D environments can increase overall contract cost.
Dependence on a single delivery order under an IDIQ may limit long-term strategic planning.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.6 million to AMENTUM SERVICES, INC.. BUSINESS OPERATIONS AND ENGINEERING SUPPORT SERVICES REQUIREMENTS IN SUPPORT OF THE MICROELECTRONICS DIVISION (CODE GXV) AT NAVAL SURFACE WARFARE CENTER (NSWC) CRANE.

Who is the contractor on this award?

The obligated recipient is AMENTUM 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 $10.6 million.

What is the period of performance?

Start: 2024-03-13. End: 2026-09-30.

What is the track record of Amentum Services, Inc. in delivering similar engineering support services to the Department of Defense?

Amentum Services, Inc. has a significant track record with the Department of Defense, often inheriting contracts from previous entities like AECOM's Management Services. They provide a wide range of services including engineering, technical, and operational support across various defense platforms and agencies. Their experience spans complex R&D environments, base operations, and specialized technical services. While specific performance data for this exact type of microelectronics support is not detailed here, their broad experience suggests a capacity to handle such requirements. A deeper dive into past performance evaluations and contract closeouts for similar CPFF contracts would provide a more granular assessment of their reliability and efficiency in this domain.

How does the estimated cost of this contract compare to similar engineering support contracts for microelectronics within the DoD?

Comparing the estimated cost of $10.6 million for this contract requires access to a database of similar microelectronics engineering support contracts within the DoD. Factors such as the duration (931 days), the specific services (business operations and engineering support), and the complexity of microelectronics work at NSWC Crane would need to be considered. Contracts for specialized R&D support, particularly in cutting-edge fields like microelectronics, can vary significantly in price based on the level of expertise required, security clearances, and the scope of work. Without specific benchmarks for comparable contracts, it's difficult to definitively state whether this cost is high or low. However, the CPFF structure necessitates close monitoring of actual costs against the estimated budget.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for engineering services in a sensitive R&D environment like microelectronics?

The primary risks associated with a CPFF contract in a sensitive R&D environment like microelectronics revolve around cost control and potential scope creep. While the fixed fee provides some incentive for the contractor to manage costs efficiently to maximize profit, the 'cost plus' component means the government bears the majority of the direct costs. If the project scope expands or unforeseen technical challenges arise, costs can escalate significantly, potentially exceeding initial estimates. For the contractor, the risk lies in underestimating the effort required to achieve the fixed fee, potentially leading to reduced profit margins. For the government, the risk is paying more than anticipated if costs are not meticulously tracked and justified. Effective oversight, clear definition of work, and robust change management are crucial to mitigate these risks.

What is the strategic importance of NSWC Crane's Microelectronics Division and the services provided under this contract?

NSWC Crane's Microelectronics Division plays a critical role in the Department of Defense's efforts to maintain technological superiority, particularly in areas vital for national security such as advanced sensors, guidance systems, and electronic warfare. The division focuses on research, development, and sustainment of microelectronic components and systems. The engineering and business operations support provided under this contract are essential for the division to effectively conduct its mission, which may include developing next-generation technologies, ensuring the reliability of existing systems, and addressing supply chain vulnerabilities in critical electronic components. This support directly contributes to the warfighter's capabilities and the overall defense industrial base.

How has federal spending on engineering services for defense R&D evolved, and where does this contract fit within that trend?

Federal spending on engineering services for defense R&D has generally trended upwards, driven by the constant need for technological advancement and modernization to counter evolving threats. This spending encompasses a wide range of activities, from basic research to system development and integration. Contracts like this one, supporting specialized areas like microelectronics at a key warfare center, represent a significant portion of this investment. The trend reflects a strategic prioritization of capabilities that ensure military readiness and a competitive edge. This specific contract, valued at approximately $10.6 million over 2.5 years, fits within the broader pattern of targeted investments in critical technology sectors deemed essential for national security, particularly in areas facing rapid innovation and potential foreign competition.

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: N0016424R3006

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Pae-Parsons Global Logistics Services, LLC

Address: 4800 WESTFIELDS BLVD STE 400, CHANTILLY, VA, 20151

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

Financial Breakdown

Contract Ceiling: $87,012,265

Exercised Options: $30,483,859

Current Obligation: $10,585,489

Actual Outlays: $289,607

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017819D8773

IDV Type: IDC

Timeline