Navy awards $209.5M engineering services contract to Science Applications International Corporation for ECI IPT support

Contract Overview

Contract Amount: $20,221,115 ($20.2M)

Contractor: Science Applications International Corporation

Awarding Agency: Department of Defense

Start Date: 2023-11-08

End Date: 2026-06-30

Contract Duration: 965 days

Daily Burn Rate: $21.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: TO PROVIDE SYSTEM OPERATIONS, ENGINEERING, CONFIGURATION MANAGEMENT (CM), INTEGRATED AND MATERIEL LOGISTICS, PROGRAM MANAGEMENT, AND QUALITY ASSURANCE (QA) SERVICES IN SUPPORT OF ECI IPT.

Place of Performance

Location: CHARLESTON AFB, CHARLESTON County, SOUTH CAROLINA, 29404

State: South Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $20.2 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: TO PROVIDE SYSTEM OPERATIONS, ENGINEERING, CONFIGURATION MANAGEMENT (CM), INTEGRATED AND MATERIEL LOGISTICS, PROGRAM MANAGEMENT, AND QUALITY ASSURANCE (QA) SERVICES IN SUPPORT OF ECI IPT. Key points: 1. Contract focuses on system operations, logistics, and program management, indicating a need for comprehensive support. 2. The fixed-fee structure aims to control costs while ensuring service delivery. 3. A long performance period of 965 days suggests a stable, ongoing requirement. 4. The contract is a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle, common for long-term needs. 5. The award to a large, established contractor like SAIC suggests a focus on proven capability and reliability. 6. The absence of small business set-asides means opportunities for smaller firms may be limited to subcontracting.

Value Assessment

Rating: good

The contract's value of $209.5 million over approximately 2.6 years for comprehensive engineering and logistics support appears reasonable given the scope. Benchmarking against similar large-scale engineering support contracts for naval programs would provide a more precise value-for-money assessment. The Cost Plus Fixed Fee (CPFF) pricing structure, while common, requires careful monitoring to ensure costs remain within projections and that the fixed fee adequately compensates the contractor for the defined scope.

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 considered. The specific number of bidders is not provided, but full and open competition generally fosters a competitive environment, potentially leading to better pricing and service offerings for the government. The use of an IDIQ vehicle suggests a pre-competed framework, with this delivery order representing a specific task order awarded through a competitive process.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it maximizes the pool of potential offerors, driving down prices and encouraging innovation. This approach ensures that the government receives the best value by selecting from a wide range of qualified contractors.

Public Impact

The primary beneficiaries are the Department of the Navy's ECI IPT, which will receive essential operational, engineering, and logistics support. Services delivered include system operations, configuration management, integrated logistics, program management, and quality assurance. The geographic impact is likely concentrated around naval facilities where the ECI IPT operates, primarily in South Carolina. Workforce implications include the potential for job creation or retention within Science Applications International Corporation and its subcontractors, particularly in engineering, logistics, and program management roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Fixed Fee contracts if not rigorously managed.
Reliance on a single large contractor may limit future flexibility or innovation if not actively managed.
Scope creep could increase costs beyond initial projections if not tightly controlled through contract modifications.

Positive Signals

Award to a reputable contractor with a strong track record in defense services.
Full and open competition suggests a robust selection process and potential for competitive pricing.
Long contract duration indicates a stable requirement and potential for long-term program success.
Delivery order under an IDIQ provides a structured approach to fulfilling ongoing needs.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the broader professional, scientific, and technical services industry. The market for defense engineering services is substantial, driven by the continuous need for modernization, maintenance, and operational support of military systems. Comparable spending benchmarks would involve analyzing other large-scale engineering and logistics support contracts awarded by the Department of Defense, particularly to naval commands, to assess pricing and scope alignment.

Small Business Impact

The contract data indicates that small business participation is not a primary focus, as the 'sb' (small business set-aside) field is false. While this contract was not set aside for small businesses, Science Applications International Corporation, as a large prime contractor, may be required to meet small business subcontracting goals. The extent to which small businesses will benefit will depend on SAIC's subcontracting plan and the availability of specialized services they require.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of the Navy's contracting officers and program managers responsible for the ECI IPT. The Cost Plus Fixed Fee structure necessitates diligent financial oversight to ensure costs are reasonable and allocable. Transparency is facilitated through contract reporting requirements, and the Inspector General of the Department of Defense may conduct audits or investigations as deemed necessary to ensure compliance and prevent fraud.

Related Government Programs

Naval Sea Systems Command (NAVSEA) Contracts
Department of Defense Engineering Services
Logistics and Supply Chain Management Services
Program Management Support Contracts
Information Technology Support Services

Risk Flags

Cost Control Risk (CPFF)
Contractor Performance Monitoring
Scope Creep Potential

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.2 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. TO PROVIDE SYSTEM OPERATIONS, ENGINEERING, CONFIGURATION MANAGEMENT (CM), INTEGRATED AND MATERIEL LOGISTICS, PROGRAM MANAGEMENT, AND QUALITY ASSURANCE (QA) SERVICES IN SUPPORT OF ECI IPT.

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 $20.2 million.

What is the period of performance?

Start: 2023-11-08. End: 2026-06-30.

What is Science Applications International Corporation's track record with similar Department of Defense engineering and logistics contracts?

Science Applications International Corporation (SAIC) has a long and extensive history of providing a wide array of services to the Department of Defense (DoD), including engineering, IT, logistics, and program management. They are a major defense contractor frequently awarded large-scale contracts across various military branches. Their track record typically involves supporting complex weapon systems, command and control systems, and operational readiness initiatives. Specific to naval programs, SAIC has supported shipbuilding, fleet readiness, and C4ISR systems. While generally considered a reliable contractor, like any large firm, they have experienced contract disputes and performance reviews that warrant examination in specific instances. A detailed review of their past performance ratings and any significant contract issues would be necessary for a comprehensive assessment related to this specific award.

How does the $209.5 million value compare to similar engineering support contracts for naval programs?

The $209.5 million value for approximately 2.6 years of comprehensive engineering, operations, and logistics support for the ECI IPT is substantial but falls within the expected range for large-scale, multi-faceted support contracts awarded by the Department of the Navy. Similar contracts supporting major naval programs, such as shipbuilding, fleet modernization, or complex system integration, often range from tens to hundreds of millions of dollars over similar or longer durations. Factors influencing this value include the complexity of the systems supported, the criticality of the ECI IPT's mission, the required labor mix (engineers, technicians, logisticians, managers), and the specific services mandated. Without direct comparison to contracts with identical scope and service requirements, it's challenging to definitively benchmark value, but the amount is consistent with the scale of support typically required for significant naval initiatives.

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

The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract structure, like the one awarded to SAIC, revolve around cost control and contractor incentive. For the government, the risk is that the contractor's actual costs could exceed initial estimates, potentially leading to higher overall expenditures, even with a fixed fee. While the fee is fixed, the 'cost' portion is variable and subject to audit. The contractor bears some risk, as they are incentivized to manage costs to ensure their fee is profitable, but they are reimbursed for allowable costs. A key risk for the government is ensuring that all claimed costs are reasonable, allocable, and allowable under the contract terms. Inadequate oversight or poorly defined cost accounting standards can lead to cost overruns. Conversely, if the fixed fee is set too low, it might disincentivize the contractor from performing optimally or lead to quality compromises.

How effective is the 'full and open competition' approach likely to be in ensuring value for this specific contract?

The 'full and open competition' approach is generally considered the most effective method for ensuring value for government contracts, as it maximizes the pool of potential bidders, fosters price competition, and encourages innovation. For this specific contract, its effectiveness hinges on several factors: the clarity and completeness of the solicitation requirements, the number and capability of the bidders who responded, and the evaluation criteria used by the Navy. If the solicitation accurately defined the complex engineering and logistics needs, and if multiple capable firms competed vigorously, it is highly likely that the Navy secured competitive pricing and the best available technical solution. However, the effectiveness can be diminished if the market for such specialized services is limited, or if the evaluation process is not robust, potentially leading to an award that is not truly the best value.

What are the historical spending patterns for engineering and logistics support services within the Department of the Navy?

Historical spending patterns for engineering and logistics support services within the Department of the Navy (DoN) show a consistent and significant allocation of resources. The DoN relies heavily on contractors for a wide range of support functions, from ship design and maintenance to IT infrastructure management and supply chain operations. Spending in these categories often runs into billions of dollars annually across the Navy enterprise. Contracts for engineering services are particularly prevalent, supporting acquisition programs, research and development, and sustainment efforts. Logistics support is equally critical, encompassing everything from spare parts management to complex maintenance and repair operations. These spending patterns reflect the Navy's vast operational footprint, its aging fleet requiring extensive maintenance, and its continuous investment in new technologies and platforms.

What are the potential implications of this contract award on workforce development and job creation in South Carolina?

The award of this $209.5 million contract to Science Applications International Corporation (SAIC) for services in South Carolina has potential implications for workforce development and job creation within the state. As a large prime contractor, SAIC will likely need to hire or allocate personnel with expertise in system operations, engineering, configuration management, logistics, program management, and quality assurance. This could lead to the creation of new jobs or the retention of existing ones within SAIC's South Carolina operations. Furthermore, SAIC may engage local subcontractors, potentially creating additional employment opportunities within smaller businesses. The demand for skilled professionals in these technical and managerial fields could also spur training and development initiatives within the state's educational institutions and workforce development programs to meet the contract's requirements.

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: N6523623R3032

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 12010 SUNSET HILLS RD, 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: $49,739,738

Exercised Options: $28,070,398

Current Obligation: $20,221,115

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $4,700,795

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017819D8470

IDV Type: IDC

Timeline