Navy awards $15.5M engineering services contract to VSE Corporation for industrial revitalization support

Contract Overview

Contract Amount: $15,524,479 ($15.5M)

Contractor: VSE Corporation

Awarding Agency: Department of Defense

Start Date: 2019-03-23

End Date: 2026-03-21

Contract Duration: 2,555 days

Daily Burn Rate: $6.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: THE GOVERNMENT REQUIRES ANALYTICAL, TECHNICAL AND MANAGEMENT SUPPORT SERVICES FOR INDUSTRIAL REVITALIZATION EFFORTS TO INCLUDE CARETAKING ASSISTANCE, MODERNIZATION, EXPLOSIVES/ENERGETICS DECONTAMINATION, DEMILITARIZATION,DEMOLITION, DISPOSAL AND DIVESTITURE SUPPORT FOR THE NAVY, OTHER DOD AND NON-DOD CUSTOMERS.

Place of Performance

Location: ALEXANDRIA, FAIRFAX County, VIRGINIA, 22310

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $15.5 million to VSE CORPORATION for work described as: THE GOVERNMENT REQUIRES ANALYTICAL, TECHNICAL AND MANAGEMENT SUPPORT SERVICES FOR INDUSTRIAL REVITALIZATION EFFORTS TO INCLUDE CARETAKING ASSISTANCE, MODERNIZATION, EXPLOSIVES/ENERGETICS DECONTAMINATION, DEMILITARIZATION,DEMOLITION, DISPOSAL AND DIVESTITURE SUPPORT FOR THE NAVY, … Key points: 1. Contract provides critical support for Navy's industrial revitalization, including hazardous material handling and disposal. 2. VSE Corporation, a long-standing defense contractor, holds this significant award. 3. The contract duration extends over seven years, indicating a long-term need for these specialized services. 4. Services encompass a wide range of activities from modernization to demolition and divestiture. 5. This award falls under the Engineering Services NAICS code, a common category for such support. 6. The contract type is Cost Plus Fixed Fee, which allows for flexibility but requires careful cost oversight.

Value Assessment

Rating: good

The contract's value of $15.5 million over approximately seven years suggests a moderate annual spend for specialized industrial revitalization services. Benchmarking this against similar large-scale environmental and engineering support contracts for the Department of Defense is challenging without more granular data on the specific services provided. However, the Cost Plus Fixed Fee (CPFF) structure implies that costs are reimbursed plus a fixed fee, which can be efficient for evolving requirements but necessitates robust oversight to ensure value for money. The fixed fee component provides some predictability for contractor profit.

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 specific number of bidders is not provided, but full and open competition generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. This approach aligns with federal procurement best practices for ensuring fair and transparent award processes.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining competitive pricing and innovative solutions, thereby maximizing the value of federal dollars spent on essential services.

Public Impact

The U.S. Navy is the primary beneficiary, receiving essential support for its industrial revitalization and hazardous material management programs. Services delivered include modernization, explosives decontamination, demilitarization, demolition, disposal, and divestiture support. The geographic impact is likely concentrated around Navy installations requiring these specialized industrial services, potentially across multiple states. This contract supports a specialized workforce skilled in engineering, environmental remediation, and hazardous material handling.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can lead to cost overruns if not managed diligently.
The extended duration of the contract requires ongoing monitoring to ensure continued performance and value.
Reliance on a single contractor for such a broad scope of critical services may pose a risk if performance falters.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that likely yielded fair pricing.
VSE Corporation has a history of supporting defense contracts, indicating potential familiarity with government requirements.
The contract addresses critical needs for industrial revitalization and hazardous material management, ensuring operational readiness and environmental compliance.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), a broad category encompassing a wide range of professional engineering disciplines. The market for these services is substantial within the federal government, particularly for agencies like the Department of Defense that manage extensive infrastructure and legacy systems requiring specialized support for modernization, environmental remediation, and disposal. Comparable spending benchmarks would typically involve analyzing other large-scale environmental, demolition, and engineering support contracts awarded to various defense contractors.

Small Business Impact

The data indicates that small business participation (sb) is false, and there is no explicit small business set-aside (ss) noted for this contract. This suggests that the primary award was not specifically targeted towards small businesses. However, VSE Corporation, as the prime contractor, may engage small businesses as subcontractors to fulfill certain aspects of the contract, depending on the specific requirements and VSE's subcontracting strategy. Further analysis would be needed to determine the extent of small business involvement.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract is primarily the responsibility of the Department of the Navy's contracting and program management offices. They will monitor VSE Corporation's costs, performance, and adherence to contract terms. Transparency is facilitated through contract reporting requirements. While specific Inspector General (IG) jurisdiction is not detailed, the DoD IG typically has oversight over major defense contracts to investigate fraud, waste, and abuse.

Related Government Programs

Department of Defense Environmental Remediation Programs
Military Base Realignment and Closure (BRAC) Support Services
Defense Logistics Agency (DLA) Disposal Services
Army Corps of Engineers Environmental Services Contracts
Naval Facilities Engineering Command (NAVFAC) Contracts

Risk Flags

Cost Overrun Risk (CPFF Contract Type)
Performance Risk (Complex Services)
Long-Term Dependency Risk
Environmental Compliance Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.5 million to VSE CORPORATION. THE GOVERNMENT REQUIRES ANALYTICAL, TECHNICAL AND MANAGEMENT SUPPORT SERVICES FOR INDUSTRIAL REVITALIZATION EFFORTS TO INCLUDE CARETAKING ASSISTANCE, MODERNIZATION, EXPLOSIVES/ENERGETICS DECONTAMINATION, DEMILITARIZATION,DEMOLITION, DISPOSAL AND DIVESTITURE SUPPORT FOR THE NAVY, OTHER DOD AND NON-DOD CUSTOMERS.

Who is the contractor on this award?

The obligated recipient is VSE 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 $15.5 million.

What is the period of performance?

Start: 2019-03-23. End: 2026-03-21.

What is VSE Corporation's track record with similar large-scale environmental and engineering support contracts for the Department of Defense?

VSE Corporation has a significant history of supporting Department of Defense (DoD) contracts, often involving complex engineering, logistics, and technical services. They have previously been awarded contracts for ship maintenance, fleet readiness, and base operations support. Their experience likely includes managing large teams, complex project timelines, and stringent regulatory compliance, which are all relevant to the industrial revitalization services required under this contract. Analyzing their past performance on similar CPFF contracts would provide further insight into their ability to manage costs and deliver effectively within the specified parameters.

How does the annual spending on this contract compare to other similar engineering services contracts awarded by the Navy or DoD?

The approximate annual spend for this contract, averaging around $2.2 million ($15.5M / 7 years), appears moderate for specialized engineering and industrial support services within the DoD. However, direct comparisons are difficult without knowing the precise scope and complexity of services rendered. Larger environmental remediation or major infrastructure modernization contracts can easily reach tens or hundreds of millions annually. This contract's value suggests it supports a specific set of revitalization efforts rather than a comprehensive base overhaul. Benchmarking would require identifying contracts with similar service descriptions (demilitarization, decontamination, divestiture) and contract types (CPFF) awarded by comparable agencies.

What are the primary risk indicators associated with this Cost Plus Fixed Fee (CPFF) contract structure?

The primary risk indicator for a CPFF contract is the potential for cost overruns. While the fixed fee provides a ceiling on the contractor's profit, the government reimburses all allowable costs. This structure can incentivize contractors to incur higher costs if not meticulously managed, as it doesn't directly link their profit to cost savings. Effective oversight, detailed cost tracking, and robust auditing are crucial to mitigate this risk. Additionally, the complexity of services like explosives decontamination and demilitarization introduces inherent operational risks that require stringent safety protocols and experienced personnel.

How effective are the services delivered under this contract in achieving the Navy's industrial revitalization goals?

The effectiveness of the services delivered is contingent on the successful execution of tasks such as modernization, decontamination, and disposal. The contract's duration of over seven years suggests a long-term commitment to these revitalization efforts, implying a recognized need and potential for significant impact. Performance metrics and key performance indicators (KPIs) within the contract, which are not publicly detailed, would be the primary measures of effectiveness. Regular reviews by the Navy's program office are essential to ensure that VSE Corporation is meeting its objectives, contributing to the Navy's modernization goals, and ensuring environmental compliance.

What are the historical spending patterns for industrial revitalization and hazardous material support services within the Department of the Navy?

Historical spending patterns for industrial revitalization and hazardous material support within the Department of the Navy are substantial and multifaceted. The Navy manages a vast inventory of aging infrastructure, legacy systems, and environmentally sensitive sites across numerous installations. Spending in this area typically includes contracts for environmental remediation (e.g., PFAS cleanup, soil and groundwater contamination), demolition and disposal of obsolete facilities, munitions response, and modernization of industrial plants. These contracts often span multiple years and can range from millions to hundreds of millions of dollars annually, depending on the scale of projects and regulatory requirements. This specific $15.5M contract represents a portion of that broader spending.

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: N0017418R3001

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Address: 6348 WALKER LANE, ALEXANDRIA, VA, 22310

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

Financial Breakdown

Contract Ceiling: $22,147,133

Exercised Options: $22,147,133

Current Obligation: $15,524,479

Actual Outlays: $93,505

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4149

IDV Type: IDC

Timeline