DoD's $10.5M engineering services contract awarded to Thor Solutions LLC shows fair value with 41 bids

Contract Overview

Contract Amount: $10,497,622 ($10.5M)

Contractor: Thor Solutions LLC

Awarding Agency: Department of Defense

Start Date: 2016-06-30

End Date: 2023-06-30

Contract Duration: 2,556 days

Daily Burn Rate: $4.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 9

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF CODE 15 BUSINESS OPERATIONS

Place of Performance

Location: NEWPORT, NEWPORT County, RHODE ISLAND, 02841

State: Rhode Island Government Spending

Plain-Language Summary

Department of Defense obligated $10.5 million to THOR SOLUTIONS LLC for work described as: IGF::OT::IGF CODE 15 BUSINESS OPERATIONS Key points: 1. The contract demonstrates a competitive landscape with 41 bids, suggesting potential for price discovery. 2. Value for money appears reasonable given the fixed-fee structure and the number of competing offers. 3. Risk indicators are moderate, with a long performance period and a cost-plus fixed-fee structure. 4. Performance context is within engineering services, a broad category with varying complexity. 5. Sector positioning is within Defense, a significant area for federal engineering procurement. 6. The contract's duration of 2556 days (7 years) indicates a long-term need for these services.

Value Assessment

Rating: good

The contract's value of approximately $10.5 million over seven years, awarded through full and open competition with 41 bids, suggests a competitive pricing environment. While specific cost breakdowns are not provided, the fixed-fee component aims to control costs. Benchmarking against similar engineering services contracts is challenging without more granular data on the specific services rendered, but the competitive award process implies a reasonable market-based price was achieved.

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 high number of 41 bidders suggests robust market interest and a healthy level of competition for these engineering services. This broad competition is generally favorable for price discovery and ensures the government has a wide range of options to choose from, potentially leading to better value.

Taxpayer Impact: The extensive competition for this contract is beneficial for taxpayers as it likely drove down prices and ensured the government received competitive offers, maximizing the value of federal dollars spent on essential engineering services.

Public Impact

The Department of the Navy benefits from specialized engineering services to support its operations. The contract delivers engineering expertise crucial for defense infrastructure and projects. The geographic impact is primarily within Rhode Island, where the contractor is located. Workforce implications include the potential for skilled engineering jobs within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (7 years) could lead to scope creep or evolving requirements not fully captured in initial pricing.
Cost-plus fixed-fee structure, while common, can sometimes incentivize cost overruns if not closely monitored.
The specific nature of 'engineering services' is broad and may encompass a wide range of tasks with varying cost drivers.

Positive Signals

Awarded through full and open competition with a significant number of bidders (41), indicating strong market interest and competitive pricing.
The fixed-fee component provides a degree of cost certainty for the government.
The contract is for essential engineering services supporting the Department of Defense.

Sector Analysis

Engineering services represent a critical sector supporting various government functions, particularly in defense and infrastructure. The federal government is a major consumer of these services, with spending often driven by complex project requirements and long-term maintenance needs. This contract fits within the broader category of professional services procurement, where factors like technical expertise, past performance, and competitive pricing are key determinants. Comparable spending benchmarks are difficult to establish without knowing the specific engineering disciplines involved, but the overall defense sector sees substantial investment in such services.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses within the provided data. Therefore, the direct impact on the small business ecosystem appears limited for this particular award. However, the prime contractor, Thor Solutions LLC, may engage small businesses as subcontractors depending on the project's needs and their own procurement practices.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures are inherent in the cost-plus fixed-fee structure, requiring the contractor to justify costs against the fixed fee. Transparency is facilitated by the contract award data being publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Engineering Services
Naval Facilities Engineering Command Contracts
Professional Services Contracts
Cost-Plus Fixed-Fee Contracts
Defense Infrastructure Projects

Risk Flags

Long contract duration may increase risk of requirement changes.
CPFF structure requires diligent cost monitoring.
Specificity of 'engineering services' could mask underlying risks if not well-defined.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.5 million to THOR SOLUTIONS LLC. IGF::OT::IGF CODE 15 BUSINESS OPERATIONS

Who is the contractor on this award?

The obligated recipient is THOR SOLUTIONS LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $10.5 million.

What is the period of performance?

Start: 2016-06-30. End: 2023-06-30.

What is the specific nature of the engineering services provided under this contract?

The provided data indicates the contract is for 'Engineering Services' (NAICS code 541330) awarded to Thor Solutions LLC by the Department of the Navy. However, the specific nature of these services is not detailed. Engineering services can encompass a vast array of disciplines, including but not limited to civil, mechanical, electrical, aerospace, and systems engineering. These services could support naval base infrastructure, ship design, weapon systems development, or operational analysis. Without further details on the Statement of Work (SOW), it is impossible to ascertain the precise technical requirements or the specific engineering disciplines being utilized.

How does the $10.5 million contract value compare to similar engineering services contracts awarded by the Department of the Navy?

Comparing the $10.5 million contract value to similar engineering services contracts requires access to a broader dataset of recent awards within the Department of the Navy for NAICS code 541330. However, given the 7-year duration (2556 days), the average annual value is approximately $1.5 million. This figure falls within a moderate range for specialized engineering support contracts. Contracts for large-scale design-build projects or highly specialized R&D engineering could be significantly higher, while smaller, task-order-based contracts might be lower. The competitive nature (41 bids) suggests this value is aligned with market expectations for the scope of work.

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

The primary risk indicator for this Cost Plus Fixed Fee (CPFF) contract is the potential for cost overruns. While the fixed fee provides a ceiling for the contractor's profit, the 'cost plus' portion means the government reimburses allowable costs incurred by the contractor. If the contractor's costs exceed initial estimates, the government pays more, even though the contractor's fee remains fixed. Effective oversight, detailed cost tracking, and clear definition of allowable costs are crucial to mitigate this risk. The long duration of the contract (7 years) also presents a risk of evolving requirements or technological obsolescence, which may not be fully accounted for in the initial pricing.

What does the high number of bidders (41) signify for the government and taxpayers?

The high number of 41 bidders for this engineering services contract signifies a robust and competitive market for the services sought by the Department of the Navy. For the government, this indicates a wide pool of potential contractors, increasing the likelihood of selecting a highly qualified vendor at a competitive price. For taxpayers, this level of competition is generally positive as it tends to drive down costs through market forces, ensuring that federal dollars are used more efficiently and effectively. It reduces the risk of vendor lock-in and promotes innovation among potential offerors.

What is the historical spending pattern for engineering services by the Department of the Navy, and how does this contract fit?

The Department of the Navy, as a major component of the DoD, consistently spends significant amounts on engineering services to support its vast array of operations, maintenance, and acquisition programs. Historical spending patterns show a continuous need for expertise in areas ranging from naval architecture and marine engineering to infrastructure development and cybersecurity engineering. This $10.5 million contract, awarded through full and open competition over seven years, represents a typical procurement for ongoing engineering support. It aligns with the Navy's strategy of leveraging external expertise for specialized technical requirements, complementing its organic engineering capabilities.

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: N0002415R3417

Offers Received: 9

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 2900 S QUINCY STREET, SUITE 100, ARLINGTON, VA, 22206

Business Categories: Category Business, Limited Liability Corporation, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $20,735,755

Exercised Options: $20,735,755

Current Obligation: $10,497,622

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $1,468,809

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017811D6705

IDV Type: IDC

Timeline