DoD's $39.4M contract for engineering services awarded to BAE Systems, spanning over a decade

Contract Overview

Contract Amount: $39,429,831 ($39.4M)

Contractor: BAE Systems Technology Solutions & Services Inc.

Awarding Agency: Department of Defense

Start Date: 1999-05-06

End Date: 2010-05-14

Contract Duration: 4,026 days

Daily Burn Rate: $9.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 199912!1700!2836!A8107!NAVAL AIR WARFARE CENTER, AIRCRA!N0042199C1550 !A!*!* !19990506!19990930!103933453!614764918!210116406!N!99789!MARCONI SYSTEM TECHNOLOGIES IN!1601 RESEARCH BLVD !ROCKVILLE !MD!20850!12150!037!24!CALIFORNIA !ST. MARY S !MARYLAND !0001!+000000881895!N!N!000000000000!R425!ENGINEERING TECHNICAL SERVICES !C9E!ALL OTHER SUPPLIES AND EQUIPME!2000!NOT DISCERNABLE OR CLASSIFIED !8711!3!*!*!*!B!A!*!A !N!U!2!001!B!* !C!Y!Z!* !* !N!C!*!C!C!A!A!A!*!* !*!N!A!C!N!*!*!*!*!*!

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $39.4 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. for work described as: 199912!1700!2836!A8107!NAVAL AIR WARFARE CENTER, AIRCRA!N0042199C1550 !A!*!* !19990506!19990930!103933453!614764918!210116406!N!99789!MARCONI SYSTEM TECHNOLOGIES IN!1601 RESEARCH BLVD !ROCKVILLE !MD!20850!12150!037!24!CALIFORNIA !ST. MA… Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. Long contract duration of over 10 years may indicate a need for sustained services. 3. Cost-plus fixed-fee contract type can lead to cost overruns if not managed carefully. 4. The contract was awarded to BAE Systems, a major defense contractor with a significant presence. 5. Services provided fall under engineering, a critical sector for defense operations. 6. The contract was managed by the Defense Contract Management Agency, indicating oversight.

Value Assessment

Rating: fair

The total value of $39.4 million over more than 10 years averages to approximately $3.94 million per year. Benchmarking this against similar engineering services contracts is challenging without more specific details on the scope of work. However, the cost-plus fixed-fee structure warrants scrutiny to ensure efficient cost management and prevent potential overruns, as the contractor is reimbursed for allowable costs plus a fixed fee.

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 solicited. The specific number of bidders is not provided, but this approach generally fosters price discovery and allows the government to select the most advantageous offer. The competitive nature suggests that the pricing, while subject to the cost-plus fixed-fee structure, was likely influenced by market forces.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the best value through a robust bidding process, potentially leading to lower overall costs compared to sole-source awards.

Public Impact

The primary beneficiary is the Department of Defense, which receives essential engineering and technical services. Services delivered likely support naval air warfare capabilities, enhancing operational readiness. The contract's geographic impact is primarily within Maryland, where the contractor is located, and potentially extends to areas where naval air operations are conducted. Workforce implications include employment opportunities for engineers and technical specialists within BAE Systems and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus fixed-fee contracts can incentivize higher spending if not closely monitored.
The long duration of the contract may reduce flexibility to adapt to changing technological needs or market conditions.
Lack of specific details on performance metrics makes it difficult to assess the true value for money delivered.

Positive Signals

Awarded through full and open competition, suggesting a competitive environment.
BAE Systems is a large, established contractor with significant experience in defense.
The contract is managed by the Defense Contract Management Agency, implying oversight.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the broader Defense industry. The market for defense engineering services is substantial, driven by the continuous need for research, development, and sustainment of military platforms and systems. Comparable spending benchmarks would depend heavily on the specific technical disciplines and the scale of the engineering support required, but contracts of this magnitude are not uncommon for major defense programs.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss=false, sb=false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside. However, as a large prime contractor, BAE Systems may engage small businesses as subcontractors, contributing to the small business ecosystem, though this is not explicitly detailed in the provided data.

Oversight & Accountability

The contract was managed by the Defense Contract Management Agency (DCMA), which is responsible for overseeing contract performance and ensuring compliance. Oversight mechanisms would typically include regular reporting, site visits, and audits. Accountability measures are inherent in the contract terms, particularly the fixed fee component, and transparency is generally maintained through contract databases like FPDS. Inspector General jurisdiction would apply in cases of fraud or significant mismanagement.

Related Government Programs

Naval Air Systems Command (NAVAIR) Contracts
Engineering and Technical Services Contracts
Department of Defense Research and Development
BAE Systems Defense Contracts

Risk Flags

Cost-plus contract type can lead to cost overruns.
Long contract duration may reduce flexibility.
Limited public data on specific performance metrics.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $39.4 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC.. 199912!1700!2836!A8107!NAVAL AIR WARFARE CENTER, AIRCRA!N0042199C1550 !A!*!* !19990506!19990930!103933453!614764918!210116406!N!99789!MARCONI SYSTEM TECHNOLOGIES IN!1601 RESEARCH BLVD !ROCKVILLE !MD!20850!12150!037!24!CALIFORNIA !ST. MARY S !MARYLAND !0001!+000000881895!N!N!000000000000!R425!ENGINEERING TECHNICAL SERVICES !C9E!ALL OTHER SUPPLIES AND EQUIPME!2000!NOT DISCERNABLE OR CLASSIFIED !8711!3!*!*!*!B!A!*!A !N!U!2!0

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $39.4 million.

What is the period of performance?

Start: 1999-05-06. End: 2010-05-14.

What specific engineering services were provided under this contract, and how did they contribute to naval air warfare capabilities?

The contract data indicates the primary service category was 'ENGINEERING TECHNICAL SERVICES' (R425). While specific details are limited, these services typically encompass a wide range of activities such as design, development, testing, analysis, and sustainment of complex systems. For naval air warfare, this could involve support for aircraft systems, avionics, weapons integration, simulation, or maintenance engineering. The contract's duration and value suggest a significant and ongoing contribution to the operational readiness and technological advancement of naval aviation assets. Without access to the detailed statement of work, the precise nature of the contribution remains generalized but is understood to be critical for maintaining and improving the effectiveness of naval air platforms.

How does the average annual value of this contract compare to similar engineering services contracts within the Department of Defense?

This contract has a total value of approximately $39.4 million over a period of roughly 10 years and 5 months (from May 6, 1999, to May 14, 2010), averaging around $3.75 million per year. Comparing this to similar contracts requires access to a broader dataset of DoD engineering services procurements with comparable scope and complexity. However, for major defense programs requiring specialized technical expertise, annual expenditures in the multi-million dollar range are common. The specific nature of 'engineering technical services' for naval air warfare suggests a specialized niche. Without granular data on contract size, duration, and specific services for comparable contracts, a precise benchmark is difficult. Generally, contracts supporting critical defense systems often represent significant investments.

What were the key performance indicators (KPIs) or metrics used to evaluate BAE Systems' performance on this contract?

The provided data does not explicitly list the Key Performance Indicators (KPIs) or specific metrics used to evaluate BAE Systems' performance under this contract. Typically, for engineering and technical services contracts, KPIs would focus on aspects such as timeliness of delivery, quality of work (e.g., defect rates, adherence to specifications), cost control (especially relevant for cost-plus contracts), technical accuracy, and responsiveness to government requests. The contract type (Cost Plus Fixed Fee) implies that performance would be assessed against the agreed-upon scope of work and the fixed fee, with deviations potentially impacting future contract modifications or award fees, if applicable. Formal performance evaluations are usually documented separately from basic contract award data.

What is BAE Systems' track record with the Department of Defense, particularly in providing engineering services?

BAE Systems is a major global defense contractor with a substantial and long-standing relationship with the Department of Defense (DoD). They have a broad portfolio of contracts across various defense sectors, including naval, air, and land systems, as well as C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance) and cyber capabilities. Their track record in providing engineering and technical services is extensive, encompassing design, development, integration, testing, and sustainment support for numerous platforms and systems. While specific performance details for individual contracts vary, BAE Systems is generally recognized as a capable provider of complex defense solutions. Their history with the DoD includes both large-scale program execution and specialized technical support roles, making them a frequent recipient of significant defense contracts.

How did the cost-plus fixed-fee (CPFF) contract structure potentially impact the final cost to the government compared to a fixed-price contract?

The Cost-Plus Fixed-Fee (CPFF) contract structure means the contractor (BAE Systems) is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure is typically used when the scope of work is not precisely defined, or there is significant uncertainty, making it difficult to estimate costs accurately beforehand. Compared to a fixed-price contract, where the contractor assumes most of the cost risk and the price is set upfront, CPFF shifts a significant portion of the cost risk to the government. While the 'fixed fee' provides some predictability regarding profit, the total cost to the government can fluctuate based on actual allowable costs. If costs escalate due to unforeseen issues, inefficiencies, or scope creep, the total expenditure will be higher than initially projected. Effective government oversight is crucial in CPFF contracts to control allowable costs and ensure the contractor remains efficient.

What is the significance of the contract being managed by the Defense Contract Management Agency (DCMA)?

The involvement of the Defense Contract Management Agency (DCMA) signifies that this contract was subject to post-award oversight. DCMA's primary role is to ensure that contractors meet their contractual obligations in terms of schedule, cost, and performance. For a contract like this, DCMA would likely have assigned personnel to monitor BAE Systems' operations, review cost submissions, verify progress, ensure quality control, and facilitate communication between the contractor and the requiring activity (in this case, likely related to Naval Air Systems Command). DCMA's management provides an essential layer of accountability and assurance for the government that the services are being delivered as intended and that taxpayer funds are being used appropriately.

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: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC (UEI: 217304393)

Address: 1601 RESEARCH BLVD, ROCKVILLE, MD, 08

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline