DoD's $37.3M engineering services contract awarded to Chugach Information Technology LLC shows fair value

Contract Overview

Contract Amount: $37,316,721 ($37.3M)

Contractor: Chugach Information Technology LLC

Awarding Agency: Department of Defense

Start Date: 2017-12-29

End Date: 2020-07-06

Contract Duration: 920 days

Daily Burn Rate: $40.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF

Place of Performance

Location: ANCHORAGE, ANCHORAGE County, ALASKA, 99503

State: Alaska Government Spending

Plain-Language Summary

Department of Defense obligated $37.3 million to CHUGACH INFORMATION TECHNOLOGY LLC for work described as: IGF::OT::IGF Key points: 1. Contract value appears reasonable given the scope of engineering services. 2. Full and open competition suggests a competitive pricing environment. 3. Contract duration and delivery order structure indicate potential for scope adjustments. 4. Performance in Alaska may present unique logistical and operational considerations. 5. The contract falls within the broader engineering services sector for the Department of Defense.

Value Assessment

Rating: good

The contract's total value of $37.3 million over its period of performance appears to be within a reasonable range for engineering services provided to the Department of Defense. Benchmarking against similar contracts for large-scale engineering support in remote or specialized locations would provide a more precise value assessment. However, the absence of significant cost overruns or disputes, based on available data, suggests that the pricing was likely competitive and reflective of market rates at the time of award.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. This competitive process is generally expected to drive down prices and ensure that the government receives the best value. The number of bidders is not specified, but the method of award suggests a robust competition.

Taxpayer Impact: Taxpayers benefit from the competitive nature of this award, as it likely resulted in a more favorable price compared to a sole-source or limited competition scenario.

Public Impact

The Department of Defense benefits from specialized engineering services to support its operations. Services delivered likely include design, analysis, and technical support for military infrastructure or systems. The geographic impact is concentrated in Alaska (AK), potentially supporting remote or strategic military installations. Workforce implications may include the employment of engineers, technicians, and support staff, both directly by the contractor and indirectly through subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in long-duration delivery orders.
Ensuring consistent quality of engineering services across the contract duration.
Managing performance in a remote location like Alaska.

Positive Signals

Awarded through full and open competition, suggesting competitive pricing.
Contractor has a track record of performance, implied by award.
Clear period of performance with defined end date.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the broader professional services market supporting government agencies. The market for engineering services is substantial, with significant government spending allocated to design, consulting, and technical support for infrastructure, defense systems, and research and development. This contract represents a portion of the Department of the Navy's investment in specialized engineering capabilities.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. Therefore, the direct impact on the small business ecosystem may be limited unless the prime contractor voluntarily engages small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contract administration office within the Department of the Navy. Performance monitoring, quality assurance, and financial oversight are standard mechanisms. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

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

Risk Flags

Potential for cost overruns due to CPFF structure.
Performance risks associated with remote location (Alaska).
Long contract duration requires sustained oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.3 million to CHUGACH INFORMATION TECHNOLOGY LLC. IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is CHUGACH INFORMATION TECHNOLOGY 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 $37.3 million.

What is the period of performance?

Start: 2017-12-29. End: 2020-07-06.

What is the contractor's performance history with the Department of Defense on similar contracts?

While specific performance details for Chugach Information Technology LLC on this particular contract are not provided in the abbreviated data, the award itself suggests a level of confidence from the Department of the Navy. A comprehensive review would involve examining past performance evaluations, any documented disputes or claims, and the contractor's overall track record with federal agencies. Understanding their history on cost-plus-fixed-fee contracts and in remote locations like Alaska would be particularly relevant for assessing future performance risks and value.

How does the cost-plus-fixed-fee (CPFF) structure impact value for money in this contract?

The Cost-Plus-Fixed-Fee (CPFF) contract type means the contractor is reimbursed for allowable costs plus a fixed fee representing profit. This structure can be advantageous for complex projects where the scope is not fully defined at the outset, allowing for flexibility. However, it can also incentivize cost increases, as the contractor is guaranteed their fee regardless of cost efficiency. For value for money, close oversight of allowable costs and ensuring the fixed fee remains competitive are crucial. Benchmarking the fee against industry standards for similar services is important.

What are the key risks associated with performing engineering services in Alaska for the DoD?

Performing engineering services in Alaska for the Department of Defense presents several unique risks. These include logistical challenges due to remote locations and harsh weather conditions, potentially increasing costs and timelines. Environmental considerations are also significant, requiring adherence to strict regulations. Workforce availability and retention in remote areas can be difficult, impacting project continuity. Furthermore, specialized equipment and transportation may be needed, adding complexity and cost. The contractor's ability to mitigate these risks is critical for successful project execution and value delivery.

What is the historical spending trend for engineering services by the Department of the Navy in Alaska?

Analyzing historical spending trends for engineering services by the Department of the Navy in Alaska would provide valuable context for this $37.3 million contract. This would involve examining contract awards over several fiscal years to identify patterns in contract types, service providers, and overall expenditure levels. Understanding whether this contract represents an increase, decrease, or steady level of investment can help assess its significance and potential future spending trajectories. It also helps in benchmarking current contract values against historical norms.

How does the contract duration (920 days) compare to typical engineering service contracts of similar scope?

A duration of 920 days (approximately 2.5 years) for a $37.3 million engineering services contract is moderately long, suggesting a substantial scope of work or a phased approach to service delivery. Typical durations can vary widely based on project complexity, but for large-scale engineering support, multi-year contracts are common. This duration allows for continuity of service and potentially deeper integration of the contractor's expertise. However, it also necessitates robust performance management over an extended period to ensure ongoing value and alignment with evolving DoD requirements.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N6523617R3189

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Chugach Alaska Corporation (UEI: 071844021)

Address: 3800 CENTERPOINT DR STE 1200, ANCHORAGE, AK, 99503

Business Categories: 8(a) Program Participant, Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Tribally Owned Firm, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $37,316,721

Exercised Options: $37,316,721

Current Obligation: $37,316,721

Subaward Activity

Number of Subawards: 21

Total Subaward Amount: $10,762,440

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017815D8134

IDV Type: IDC

Timeline