Navy awards $27M contract for engineering services, with Laurel Technologies Partnership as prime

Contract Overview

Contract Amount: $26,966,319 ($27.0M)

Contractor: Laurel Technologies Partnership

Awarding Agency: Department of Defense

Start Date: 2021-07-29

End Date: 2022-07-28

Contract Duration: 364 days

Daily Burn Rate: $74.1K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS INCENTIVE FEE

Sector: IT

Official Description: USN TI-20/22 ENGINEERING, YEAR 3

Place of Performance

Location: JOHNSTOWN, CAMBRIA County, PENNSYLVANIA, 15904

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $27.0 million to LAUREL TECHNOLOGIES PARTNERSHIP for work described as: USN TI-20/22 ENGINEERING, YEAR 3 Key points: 1. Contract value appears reasonable given the duration and scope of engineering services. 2. Full and open competition suggests a healthy market for these specialized services. 3. Potential risks include performance under a cost-plus incentive fee structure. 4. This contract supports critical navigation and guidance systems for the Navy. 5. The IT sector, specifically defense-related systems, is the primary focus. 6. The award is a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) contract.

Value Assessment

Rating: good

The contract value of approximately $27 million over one year for engineering services is within a reasonable range for specialized defense systems. Benchmarking against similar contracts for navigation and guidance system development would provide a more precise value-for-money assessment. The cost-plus incentive fee (CPIF) structure aims to control costs while incentivizing performance, which can be effective if properly managed. However, without detailed cost breakdowns, a definitive assessment of pricing efficiency is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors were likely solicited and allowed to bid. This competitive process is expected to drive better pricing and service quality. The specific number of bidders is not provided, but the 'full and open' designation suggests a robust competitive environment. This approach generally leads to a more efficient allocation of government funds.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically results in lower prices and higher quality services due to market forces driving efficiency and innovation among bidders.

Public Impact

The U.S. Navy benefits from advanced engineering services for its critical systems. Services delivered include engineering support for search, detection, navigation, guidance, and related systems. The geographic impact is primarily within the defense sector, supporting naval operations. Workforce implications include employment for skilled engineers and technical professionals.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus incentive fee contracts can lead to cost overruns if not closely monitored.
Reliance on a single delivery order under a larger IDIQ may concentrate risk if the prime contractor faces issues.
The specific performance metrics and incentive triggers for the CPIF structure are not detailed, making risk assessment difficult.

Positive Signals

Awarded under full and open competition, suggesting a competitive market and potentially better value.
The contract supports critical national defense functions, aligning with strategic priorities.
Laurel Technologies Partnership's selection implies they met the technical and performance requirements.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on defense-related systems and instrumentation. The market for such specialized engineering services is driven by government defense spending, with a focus on advanced technology for navigation, guidance, and detection systems. Comparable spending benchmarks would involve analyzing other contracts awarded by the Department of Defense for similar system development and engineering support.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. As a delivery order under a potentially larger IDIQ, the prime contractor, Laurel Technologies Partnership, is responsible for fulfilling the requirements. Further analysis would be needed to determine if small business participation is mandated or encouraged through subcontracting.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Navy's contracting and program management offices. Accountability measures are embedded within the Cost Plus Incentive Fee (CPIF) structure, which links contractor payment to performance outcomes. Transparency is generally maintained through contract databases, though detailed performance reports are often internal. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval Sea Systems Command (NAVSEA) Contracts
Defense Engineering Services
Navigation and Guidance Systems Procurement
IT and C4ISR Systems Contracts

Risk Flags

Cost-Plus Incentive Fee (CPIF) contract type requires careful monitoring.
Performance metrics and incentive targets need clear definition and oversight.
Potential for cost overruns if not managed effectively.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.0 million to LAUREL TECHNOLOGIES PARTNERSHIP. USN TI-20/22 ENGINEERING, YEAR 3

Who is the contractor on this award?

The obligated recipient is LAUREL TECHNOLOGIES PARTNERSHIP.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $27.0 million.

What is the period of performance?

Start: 2021-07-29. End: 2022-07-28.

What is Laurel Technologies Partnership's track record with the Department of Defense, particularly on similar engineering contracts?

Laurel Technologies Partnership has a history of contracts with the Department of Defense, often related to engineering and technical services. Specific performance data on past contracts, including any awards, penalties, or contract modifications, would provide a clearer picture of their reliability and capability. Analyzing their past performance ratings and any documented issues on previous DoD contracts is crucial for assessing their suitability for this current award. Without access to detailed performance histories, it's difficult to definitively gauge their track record beyond their presence in the federal contracting space.

How does the $27 million contract value compare to similar engineering services contracts for naval systems?

The $27 million contract value for one year of engineering services for search, detection, navigation, guidance, and related systems is a significant award. To benchmark its value, one would compare it against other contracts awarded by the Department of the Navy or other defense agencies for similar scope and duration. Factors such as the complexity of the systems, the level of R&D involved, and the specific technical expertise required would influence pricing. A preliminary assessment suggests it is within a reasonable range for specialized defense engineering, but a detailed market analysis of comparable contracts is necessary for a definitive value-for-money conclusion.

What are the primary risks associated with the Cost Plus Incentive Fee (CPIF) contract type for this specific project?

The primary risks with a CPIF contract type for this project revolve around cost control and performance management. While the incentive fee aims to motivate the contractor to perform efficiently and meet targets, there's a risk that the target costs could be set too high, leading to excessive profits for the contractor. Conversely, if targets are too stringent or unrealistic, it could stifle innovation or lead to disputes. Effective oversight by the Navy is critical to ensure that the incentive structure is fair, achievable, and genuinely drives desired outcomes without encouraging unnecessary spending or compromising quality. The complexity of the engineering services also adds a layer of risk in defining and measuring performance metrics.

How effective is the 'full and open competition' approach likely to be in ensuring optimal pricing and quality for these specialized engineering services?

The 'full and open competition' approach is generally considered the most effective method for ensuring optimal pricing and quality for specialized engineering services. By allowing all responsible sources to submit bids, it fosters a competitive environment where contractors are incentivized to offer their best prices and technical solutions to win the contract. This broad competition increases the likelihood that the government will receive a high-quality service at a fair market price. The success of this approach hinges on the clarity of the solicitation requirements and the rigor of the evaluation process to ensure that the lowest price is not chosen at the expense of essential technical capabilities.

What is the historical spending pattern for similar engineering services by the Department of the Navy over the past five years?

Historical spending patterns for similar engineering services by the Department of the Navy typically show consistent investment in areas supporting naval modernization, readiness, and technological advancement. This includes significant outlays for systems engineering, research and development, and lifecycle support for platforms and weapon systems. Spending can fluctuate based on strategic priorities, budget allocations, and specific program needs, such as upgrades to existing systems or development of new capabilities. Analyzing trends in contract awards for navigation, guidance, and detection systems specifically would reveal whether this $27 million award aligns with or deviates from historical investment levels in this sub-sector.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0025318R0002

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Parent Company: Leonardo SPA

Address: 246 AIRPORT RD, JOHNSTOWN, PA, 15904

Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $26,988,875

Exercised Options: $26,988,875

Current Obligation: $26,966,319

Subaward Activity

Number of Subawards: 28

Total Subaward Amount: $14,434,872

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0025319D0004

IDV Type: IDC

Timeline