DoD awards $45.5M engineering services contract to Science Applications International Corporation

Contract Overview

Contract Amount: $45,547,407 ($45.5M)

Contractor: Science Applications International Corporation

Awarding Agency: Department of Defense

Start Date: 2021-11-19

End Date: 2023-11-20

Contract Duration: 731 days

Daily Burn Rate: $62.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: HOLDING SLIN FOR CLIN 0001

Place of Performance

Location: HANAHAN, BERKELEY County, SOUTH CAROLINA, 29410

State: South Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $45.5 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: HOLDING SLIN FOR CLIN 0001 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 incentivize cost overruns. 3. The duration of 731 days indicates a significant, long-term service requirement. 4. The award was made by the Department of the Navy, a major defense procurement agency. 5. The North American Industry Classification System (NAICS) code 541330 points to engineering services. 6. The contract was awarded as a Delivery Order, suggesting it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract.

Value Assessment

Rating: fair

Benchmarking the value of this $45.5 million contract is challenging without specific performance metrics or comparable contract data. The Cost Plus Fixed Fee (CPFF) contract type, while common for complex services where costs are difficult to predict, carries inherent risks of cost escalation. Without detailed breakdowns of labor hours, rates, and overhead, it's difficult to assess if the fixed fee is reasonable or if the overall cost represents good value for the engineering services rendered. Further analysis would require comparing the contractor's proposed costs and fee against industry benchmarks for similar engineering services and contract types.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that the Department of the Navy solicited bids from all responsible sources. The number of bidders is not specified, but this method generally promotes price discovery and allows the government to select the best value offering. The open competition suggests a healthy market for these engineering services, potentially leading to more competitive pricing than a sole-source or limited competition award.

Taxpayer Impact: Taxpayers benefit from full and open competition as it typically drives down prices and ensures the government receives a fair market value for the services procured.

Public Impact

The Department of Defense benefits from specialized engineering expertise to support its operations and acquisitions. Services delivered likely include design, analysis, testing, and technical support for naval systems or infrastructure. The geographic impact is primarily within South Carolina, where the contract is registered, but the services may support broader naval operations. The contract supports a workforce of engineers and technical specialists, contributing to the defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can lead to higher costs if not managed diligently.
Lack of specific performance metrics makes it difficult to assess true value for money.
The duration of the contract could lead to scope creep if not tightly managed.

Positive Signals

Awarded through full and open competition, indicating a competitive process.
Science Applications International Corporation is a large, established defense contractor with significant experience.
The contract supports critical defense engineering needs.

Sector Analysis

The engineering services sector supporting the defense industry is a significant market. Companies like Science Applications International Corporation provide critical technical expertise for complex military systems, research and development, and infrastructure projects. Spending in this sector is driven by national security priorities and the need for advanced technological capabilities. This contract fits within the broader category of professional, scientific, and technical services, a substantial portion of which is contracted by the federal government, particularly the Department of Defense.

Small Business Impact

This contract does not indicate any specific small business set-aside. Given the nature of the services and the prime contractor, it is possible that small businesses could be involved as subcontractors. However, without specific subcontracting plans or goals outlined in the award data, the direct impact on the small business ecosystem is unclear. Further investigation into subcontracting requirements would be needed to assess the extent of small business participation.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures would be tied to the terms of the Cost Plus Fixed Fee contract, including cost reporting and performance milestones. Transparency is generally facilitated through contract award databases, though detailed performance data may be limited. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Engineering Services
Naval Systems Support Contracts
Professional, Scientific, and Technical Services
Cost Plus Fixed Fee Contracts
Indefinite Delivery/Indefinite Quantity (IDIQ) Contracts

Risk Flags

Cost Plus Fixed Fee contract type carries inherent risk of cost overruns.
Lack of detailed performance metrics makes value assessment difficult.
Potential for scope creep in long-duration contracts.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $45.5 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. HOLDING SLIN FOR CLIN 0001

Who is the contractor on this award?

The obligated recipient is SCIENCE APPLICATIONS INTERNATIONAL CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $45.5 million.

What is the period of performance?

Start: 2021-11-19. End: 2023-11-20.

What is the track record of Science Applications International Corporation (SAIC) with Cost Plus Fixed Fee (CPFF) contracts with the Department of Defense?

Science Applications International Corporation (SAIC) has a long history of performing on Cost Plus Fixed Fee (CPFF) contracts with the Department of Defense (DoD). As a major defense contractor, SAIC frequently utilizes various contract types, including CPFF, for complex engineering, IT, and professional services where costs are difficult to estimate precisely upfront. Analyzing SAIC's past performance on similar CPFF contracts would involve reviewing their delivery history, any incurred cost overruns or underruns, the reasonableness of their fixed fees, and overall client satisfaction ratings. Government contract databases and performance reports (like Contractor Performance Assessment Reporting System - CPARS) can provide insights into their historical success and challenges in managing these types of agreements, helping to gauge their capability in delivering value under this specific contract structure.

How does the $45.5 million value of this contract compare to similar engineering services contracts awarded by the Department of the Navy?

The $45.5 million value for engineering services awarded to SAIC is a substantial but not extraordinary figure within the context of Department of the Navy (DoN) procurements. The DoN regularly awards contracts in the tens to hundreds of millions of dollars for complex engineering, systems integration, and technical support services. To benchmark this specific contract's value, one would need to compare it against other contracts for similar NAICS codes (e.g., 541330) and service scopes (e.g., naval systems engineering, platform design, R&D support) awarded over a comparable timeframe. Factors such as contract duration, specific deliverables, and the level of technical complexity significantly influence pricing. Without more granular data on the specific engineering tasks and the number of labor hours/rates involved, a precise value comparison is difficult, but the amount suggests a significant, multi-year engagement for specialized expertise.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract structure for this type of engineering service?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract structure for engineering services is the potential for cost overruns. While the 'cost plus' portion covers the contractor's allowable expenses, the 'fixed fee' is negotiated upfront and remains constant regardless of the final cost. This can create a disincentive for the contractor to control costs aggressively, as their profit margin (the fee) is not directly tied to cost savings. If costs escalate significantly, the government may end up paying substantially more than initially anticipated, even though the contractor's profit remains fixed. Effective oversight, detailed cost tracking, and robust negotiation of the fee are crucial to mitigate these risks and ensure value for money. Scope creep, where the project's requirements expand beyond the original agreement, is another significant risk that can inflate costs under a CPFF arrangement.

How does the 'full and open competition' award method impact the potential effectiveness and cost of this engineering service contract?

Awarding this engineering service contract through 'full and open competition' generally enhances its potential effectiveness and cost-efficiency. This method ensures that a wide range of qualified contractors can bid, fostering a competitive environment that typically drives down prices and encourages innovation. The Department of the Navy can select the offer that provides the best overall value, considering factors beyond just price, such as technical approach, past performance, and management capability. This competitive pressure incentivizes contractors to propose realistic costs and efficient solutions to win the contract. Furthermore, the broader pool of bidders increases the likelihood of finding a contractor with the most suitable expertise and capabilities for the specific engineering requirements, thereby improving the overall effectiveness of the service delivery.

What historical spending patterns exist for engineering services procured by the Department of the Navy under NAICS code 541330?

The Department of the Navy (DoN) consistently represents a significant portion of federal spending on engineering services, categorized under NAICS code 541330. Historical data reveals substantial annual outlays by the DoN for a wide array of engineering support, encompassing naval architecture, systems engineering, design, testing, and technical consulting for platforms like ships, submarines, aircraft, and shore infrastructure. Spending in this category often fluctuates based on defense budgets, modernization programs, and specific acquisition needs. Major contracts are frequently awarded to large, established defense contractors, often through competitive processes, but also through IDIQ vehicles that allow for task order awards over several years. Analyzing trends would show periods of increased investment during major platform development or upgrades and potentially lower spending during budget austerity.

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: N6523621R0080

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 12010, SUNSET HILLS ROAD, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $86,613,406

Exercised Options: $86,613,406

Current Obligation: $45,547,407

Actual Outlays: $941,588

Subaward Activity

Number of Subawards: 48

Total Subaward Amount: $13,567,674

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q14OADU130

IDV Type: IDC

Timeline