DoD awards BAE Systems $3.4M for engineering services, with a 2-year period of performance

Contract Overview

Contract Amount: $3,445,291 ($3.4M)

Contractor: BAE Systems Technology Solutions & Services Inc.

Awarding Agency: Department of Defense

Start Date: 2024-05-29

End Date: 2026-05-28

Contract Duration: 729 days

Daily Burn Rate: $4.7K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: AWARD AND INCREMENTALLY FUND THE SUBJECT TASK ORDER.

Place of Performance

Location: SAINT INIGOES, SAINT MARYS County, MARYLAND, 20684

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $3.4 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. for work described as: AWARD AND INCREMENTALLY FUND THE SUBJECT TASK ORDER. Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 3. Performance period of 729 days indicates a medium-term engagement for engineering services. 4. The contract is for engineering services, a critical support function for defense operations. 5. The award is a delivery order, suggesting it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract.

Value Assessment

Rating: fair

The award amount of $3.45 million for engineering services over two years appears moderate. Without specific deliverables or a comparison to similar task orders under a potential IDIQ, a precise value-for-money assessment is challenging. The Cost Plus Fixed Fee (CPFF) structure necessitates close monitoring to ensure costs remain within reasonable bounds and that the fixed fee adequately compensates the contractor for their effort without excessive profit. Benchmarking against other CPFF contracts for similar engineering services would provide a clearer picture of pricing efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The specific number of bidders is not provided, but this method generally fosters price discovery and encourages competitive pricing. The Navy's decision to use full and open competition suggests confidence in the market's ability to provide qualified offerors for these engineering services.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing and the assurance that the government sought the best value from a broad range of qualified contractors.

Public Impact

The Department of the Navy benefits from specialized engineering services to support its operations. This contract likely supports critical defense infrastructure or systems requiring engineering expertise. The services are expected to be performed in Maryland, potentially impacting the local workforce in that region. The contract contributes to the broader defense industrial base by engaging a major contractor like BAE Systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contracts can incentivize contractors to increase costs to achieve a higher fee if not properly managed.
Lack of specific performance metrics makes it difficult to assess the efficiency and effectiveness of the engineering services.
The duration of the contract (729 days) is substantial, requiring ongoing oversight to ensure continued value.

Positive Signals

Awarded through full and open competition, suggesting a robust and competitive bidding process.
BAE Systems is a large, established defense contractor with a significant track record, implying a degree of reliability.
The contract is for engineering services, a fundamental requirement for maintaining and advancing defense capabilities.

Sector Analysis

Engineering services are a vital component of the defense sector, encompassing design, development, testing, and maintenance of complex military systems. The market for these services is substantial, driven by continuous modernization and operational needs of armed forces globally. This contract fits within the broader category of professional, scientific, and technical services supporting the Department of Defense. Comparable spending benchmarks would typically be found within the Navy's overall budget for engineering support contracts.

Small Business Impact

This contract does not appear to have a small business set-aside (ss=false, sb=false). As a delivery order awarded to a large prime contractor, there may be opportunities for small businesses to participate as subcontractors. However, the extent of small business subcontracting is not detailed in the provided data. Analysis of the prime contractor's subcontracting plan would be necessary to understand the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy's contracting and program management offices. Accountability measures would be tied to the contract's performance work statement and the Cost Plus Fixed Fee structure, requiring detailed cost reporting and progress updates. Transparency is facilitated by the contract award being publicly available, though specific performance details may be sensitive. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Engineering Services
Navy Professional Services Contracts
Cost Plus Fixed Fee Contracts
Defense Technology Support Services

Risk Flags

Cost Plus Fixed Fee (CPFF) contract type requires diligent oversight to manage potential cost overruns.
Lack of specific performance metrics in the award data makes it difficult to assess value for money upfront.
The contract is a delivery order, implying it's part of a larger IDIQ; understanding the parent contract is key for full context.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $3.4 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC.. AWARD AND INCREMENTALLY FUND THE SUBJECT TASK ORDER.

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TECHNOLOGY SOLUTIONS & 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 $3.4 million.

What is the period of performance?

Start: 2024-05-29. End: 2026-05-28.

What is BAE Systems' track record with similar Cost Plus Fixed Fee (CPFF) engineering services contracts with the Department of the Navy?

BAE Systems Technology Solutions & Services Inc. has a substantial history of performing engineering and technical services for the Department of Defense, including the Navy. Their track record with CPFF contracts is generally extensive, given the nature of complex defense projects. While specific performance metrics for this particular task order are not yet available, BAE Systems typically operates within established government contracting frameworks. Past performance reviews and contract close-outs for similar engagements would provide a more granular assessment of their reliability, cost control, and adherence to schedules. However, as a large, established contractor, they are generally considered a reliable entity for such services, though vigilance in oversight is always recommended for CPFF arrangements.

How does the $3.45 million award compare to typical engineering services contracts of similar scope and duration awarded by the Navy?

The $3.45 million award for 729 days (approximately 2 years) of engineering services falls within a moderate range for task orders of this nature. Without knowing the specific technical requirements or the complexity of the engineering services, a direct comparison is difficult. However, larger, more complex system engineering efforts or research and development projects can easily run into tens or hundreds of millions of dollars. Conversely, smaller, more focused support tasks might be awarded for less. The Cost Plus Fixed Fee (CPFF) structure is common for services where the scope may evolve or is difficult to define precisely upfront. Benchmarking against other CPFF engineering services task orders under similar IDIQ vehicles or for comparable naval systems would provide a more robust comparison point for value.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for engineering services, and how are they mitigated in this case?

The primary risk with CPFF contracts is the potential for cost escalation, as the contractor is reimbursed for all allowable costs plus a fixed fee. This can incentivize less cost-conscious behavior if not managed diligently. Mitigation strategies include robust government oversight, detailed cost tracking and auditing, clear definition of allowable costs, and strong program management to ensure the scope is well-defined and managed. The fixed fee itself acts as a ceiling on profit, but the total cost can still increase. The Navy's contracting officers and technical representatives are responsible for monitoring expenditures, ensuring work is progressing according to the Performance Work Statement (PWS), and validating all costs submitted by BAE Systems. Regular reviews and reporting are crucial.

What is the expected impact of this contract on the Department of the Navy's engineering capabilities and readiness?

This contract is expected to enhance the Department of the Navy's engineering capabilities by providing specialized expertise that may not be available internally or is needed to supplement existing teams. The engineering services procured will likely support the design, development, sustainment, or modernization of critical naval platforms, systems, or infrastructure. This directly contributes to maintaining and improving the Navy's operational readiness by ensuring that its assets are technologically sound, well-maintained, and capable of meeting mission requirements. The specific impact depends heavily on the precise nature of the engineering tasks outlined in the Performance Work Statement.

How has the Navy's spending on engineering services evolved over the past five years, and does this award align with historical trends?

The Department of the Navy consistently allocates significant portions of its budget to engineering and technical services, reflecting the complexity and lifecycle demands of naval systems. Historical spending trends show a steady demand for these services, often fluctuating based on major acquisition programs, modernization efforts, and sustainment requirements. Awards like this $3.45 million task order are typical components of the Navy's overall engineering services expenditure. While specific year-over-year trends require detailed budget analysis, this award aligns with the ongoing need for specialized engineering support to maintain fleet readiness and technological advantage. The use of IDIQ vehicles and delivery orders, as suggested here, is a common contracting approach to manage this consistent demand efficiently.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0042122R0172

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Ball Corporation

Address: 520 GAITHER RD, ROCKVILLE, MD, 20850

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

Financial Breakdown

Contract Ceiling: $5,718,404

Exercised Options: $5,226,537

Current Obligation: $3,445,291

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0042124D0008

IDV Type: IDC

Timeline