DoD's $54.6M Amentum Services contract for engineering services awarded without competition

Contract Overview

Contract Amount: $54,651,660 ($54.7M)

Contractor: Amentum Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-01-10

End Date: 2025-07-09

Contract Duration: 546 days

Daily Burn Rate: $100.1K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: HOLDING SLIN - BASE YEAR - LABOR

Place of Performance

Location: NORTH CHARLESTON, CHARLESTON County, SOUTH CAROLINA, 29405

State: South Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $54.7 million to AMENTUM SERVICES, INC. for work described as: HOLDING SLIN - BASE YEAR - LABOR Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, which can lead to higher costs if not managed closely. 2. The 'NOT COMPETED' award type raises questions about the justification for foregoing a competitive process. 3. The contract duration of approximately 1.5 years (546 days) is relatively short, suggesting a specific, defined need. 4. The North American Industry Classification System (NAICS) code 541330 indicates a focus on engineering services. 5. The contract is a Delivery Order under a larger contract vehicle, implying a pre-existing relationship or framework. 6. The base year value of $54.6 million warrants scrutiny regarding its alignment with market rates for similar services.

Value Assessment

Rating: questionable

The contract's cost-plus-fixed-fee structure requires careful oversight to ensure value for money. Without a competitive benchmark, assessing the fairness of the pricing is challenging. Comparing this to similar engineering services contracts awarded competitively would be necessary to determine if the fixed fee and cost reimbursement are reasonable for the scope of work. The lack of competition inherently limits the ability to benchmark pricing effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as 'NOT COMPETED,' indicating a sole-source or limited competition scenario. The specific justification for this approach is not provided in the data. A sole-source award means only one contractor was solicited, which typically results in less price discovery and potentially higher costs for the government compared to a full and open competition with multiple bidders.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure to drive down costs. The government missed an opportunity to leverage market forces to secure the best possible price and value.

Public Impact

The Department of the Navy benefits from specialized engineering services to support its operations. The contract likely supports critical infrastructure or program management within the Navy's purview. The geographic impact is centered around the Navy's operational areas, potentially within South Carolina where the contract is registered. The workforce implications would involve skilled engineers and technical personnel employed by Amentum Services, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition limits price discovery and potentially increases costs for taxpayers.
Cost-plus-fixed-fee contracts require robust oversight to prevent cost overruns.
The justification for a sole-source award needs to be thoroughly reviewed for necessity and validity.
Absence of small business subcontracting data raises concerns about broader economic impact.

Positive Signals

Amentum Services, Inc. is an established contractor, suggesting potential for reliable service delivery.
The contract is a delivery order, implying it fits within an existing, potentially pre-vetted, contract vehicle.
The fixed fee component provides some cost certainty for the government, provided the cost base is controlled.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), a critical component of the broader professional, scientific, and technical services industry. This sector supports a wide range of government and private sector activities, including defense, infrastructure, and research. The market for engineering services is competitive, but specific niche expertise or existing relationships can lead to sole-source awards. Comparable spending benchmarks would typically involve analyzing other large engineering services contracts awarded by the Department of Defense or other federal agencies.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). There is no information provided regarding subcontracting plans or performance. This suggests that the primary contractor, Amentum Services, Inc., will likely perform the majority of the work. The absence of small business participation could limit opportunities for smaller firms within the defense contracting ecosystem for this specific award.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. Accountability measures would be tied to the performance standards outlined in the contract and the fixed fee structure. Transparency is limited by the sole-source nature of the award and the lack of publicly available justification. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Engineering Services Contracts
Navy Professional Services Contracts
Cost-Plus-Fixed-Fee Contracts
Sole-Source Defense Contracts

Risk Flags

Sole-source award justification required.
Potential for cost overruns in CPFF contract.
Lack of competitive pricing benchmark.
Limited transparency on specific services.
No indication of small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $54.7 million to AMENTUM SERVICES, INC.. HOLDING SLIN - BASE YEAR - LABOR

Who is the contractor on this award?

The obligated recipient is AMENTUM 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 $54.7 million.

What is the period of performance?

Start: 2024-01-10. End: 2025-07-09.

What is the specific engineering service being provided under this contract, and why was it deemed necessary to award it on a sole-source basis?

The contract falls under NAICS code 541330, which designates Engineering Services. While the specific nature of the engineering services is not detailed in the provided data, it is likely related to supporting naval operations, infrastructure, or specific defense programs. The justification for a sole-source award typically stems from factors such as unique capabilities possessed by the contractor, urgent and compelling needs where competition is not feasible, or if the contract is a follow-on to a previous competition where only one source could reasonably provide the service. Without the specific justification documentation, it is impossible to definitively state the reasons. However, the 'NOT COMPETED' status strongly suggests that the Department of the Navy determined that soliciting bids from multiple offerors was not practicable or in the government's best interest for this particular requirement.

How does the $54.6 million base year cost compare to market rates for similar engineering services provided to the Department of Defense?

Benchmarking this $54.6 million base year cost against market rates for similar engineering services is challenging without more specific details on the scope of work and the type of engineering expertise required. However, as a general indicator, large-scale engineering support contracts for the Department of Defense can range from tens to hundreds of millions of dollars annually, depending on complexity, duration, and criticality. Given that this is a sole-source award, there is no direct competitive data to establish a precise market rate. A thorough value analysis would involve comparing the proposed labor categories, hours, overhead rates, and the fixed fee against industry standards and historical data for comparable services, adjusted for factors like geographic location, security requirements, and specialized knowledge. The cost-plus-fixed-fee structure means the government pays actual allowable costs plus a predetermined fixed fee, making the oversight of direct costs crucial for ensuring value.

What are the potential risks associated with a cost-plus-fixed-fee contract awarded without competition?

The primary risks associated with a cost-plus-fixed-fee (CPFF) contract, especially when awarded without competition, are twofold. Firstly, the CPFF structure inherently shifts some risk to the government, as it reimburses the contractor for allowable costs incurred. If the contractor's cost management is weak or if the scope of work expands without adequate controls, costs can escalate beyond initial expectations. The government pays the actual costs plus a fixed fee, meaning the contractor has less incentive to control costs compared to a fixed-price contract. Secondly, awarding without competition removes the downward price pressure that a competitive bidding process provides. This lack of competition can lead to inflated costs, as the contractor may not feel compelled to offer the most competitive pricing. Robust government oversight, detailed cost accounting, and clear performance metrics are essential to mitigate these risks.

What is Amentum Services, Inc.'s track record with the Department of the Navy and for similar engineering services contracts?

Amentum Services, Inc. is a significant government contractor with a substantial history of performing services for the Department of Defense, including the Department of the Navy. While specific details of their past performance on contracts identical to this one are not provided, Amentum generally has a broad portfolio encompassing engineering, logistics, and technical support across various defense and civilian agencies. Their track record typically involves managing complex projects and providing specialized expertise. To fully assess their performance on this specific contract, one would need to review past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS) related to their work with the Navy, focusing on aspects like technical execution, cost control, schedule adherence, and overall customer satisfaction. A history of positive performance would lend confidence to their ability to execute this contract effectively.

What are the historical spending patterns for engineering services by the Department of the Navy, and how does this contract fit within that trend?

The Department of the Navy consistently spends billions of dollars annually on a wide array of services, including engineering, maintenance, IT, and professional support. Engineering services, in particular, are crucial for the design, development, maintenance, and modernization of naval platforms, infrastructure, and systems. Historical spending patterns for these services often show a steady demand, driven by fleet readiness requirements, new platform acquisitions, and infrastructure upgrades. This $54.6 million contract, while substantial for a single base year, represents a portion of the Navy's overall engineering services expenditure. Its fit within the trend depends on the specific program it supports. If it's for a critical, ongoing support function or a specialized project, it aligns with the Navy's continuous need for technical expertise. If it represents a new or expanded requirement, it could indicate a shift or increase in specific engineering service demands.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N6523623R0051

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: PAE Government Services Inc.

Address: 4800 WESTFIELDS BLVD STE 400, CHANTILLY, VA, 20151

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

Financial Breakdown

Contract Ceiling: $67,679,545

Exercised Options: $67,679,545

Current Obligation: $54,651,660

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N6523624D8014

IDV Type: IDC

Timeline