DoD's $5.37M RDT&E contract with Science Applications International Corporation for engineering services shows fair value

Contract Overview

Contract Amount: $5,374,250 ($5.4M)

Contractor: Science Applications International Corporation

Awarding Agency: Department of Defense

Start Date: 2022-05-11

End Date: 2026-05-15

Contract Duration: 1,465 days

Daily Burn Rate: $3.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: RDT&E (OUSD) SERVICES - BASE

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92152

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $5.4 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: RDT&E (OUSD) SERVICES - BASE Key points: 1. Contract awarded via full and open competition, suggesting a competitive pricing environment. 2. The contract duration of 1465 days indicates a long-term need for these engineering services. 3. The cost-plus-fixed-fee (CPFF) structure may incentivize cost control by the contractor. 4. The award is a delivery order under a larger contract, implying a pre-existing relationship and established performance metrics. 5. The geographic location in California suggests a concentration of defense-related engineering expertise in the region. 6. The contract's focus on RDT&E aligns with the Department of Defense's strategic investment in technological advancement.

Value Assessment

Rating: fair

The contract's value of $5.37 million for engineering services over approximately four years appears reasonable given the RDT&E nature of the work. Benchmarking against similar RDT&E contracts is challenging without more specific service details, but the fixed fee component suggests a degree of cost predictability. The contractor, Science Applications International Corporation (SAIC), is a large, established entity in the defense sector, which can sometimes lead to higher, but often more reliable, pricing.

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 had the opportunity to submit proposals. The presence of two bidders suggests a moderate level of competition for this specific delivery order. While full and open competition is generally preferred, the number of bidders can influence price discovery. A higher number of bidders typically leads to more competitive pricing.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing due to the full and open competition. However, with only two bidders, the price may not be as aggressively negotiated as it could be with a larger pool of interested parties.

Public Impact

The primary beneficiaries are the Department of the Navy and the broader Department of Defense, receiving specialized engineering support for research, development, testing, and evaluation. The services delivered are critical for advancing defense technologies and capabilities. The geographic impact is primarily centered in California, where the contractor is located, potentially supporting local engineering jobs. The contract supports a workforce of skilled engineers and technical professionals within SAIC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The cost-plus-fixed-fee (CPFF) contract type can sometimes lead to cost overruns if not closely monitored, despite the fixed fee incentive.
Limited competition with only two bidders might have resulted in a higher price than a more robustly competed contract.
The long contract duration (1465 days) increases the risk of scope creep or evolving requirements not being adequately addressed without strong contract management.

Positive Signals

Awarded under full and open competition, which generally promotes competitive pricing.
The contractor, SAIC, is a well-established and experienced entity in the defense sector, suggesting a lower risk of performance failure.
The fixed fee component of the contract provides a clear target for contractor profit, potentially aligning incentives for efficient performance.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the broader defense industry. The market for defense engineering services is substantial, driven by continuous RDT&E needs for military modernization and technological superiority. Comparable spending benchmarks are difficult to establish without granular detail on the specific engineering disciplines and RDT&E focus, but large defense contractors like SAIC are frequent recipients of such awards.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the contractor, Science Applications International Corporation, is a large business. There is no explicit information provided regarding subcontracting plans for small businesses. The impact on the small business ecosystem is likely minimal unless SAIC actively engages small businesses as subcontractors for specialized support.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Navy contracting officers and program managers. Accountability measures are embedded within the contract terms, including performance standards and reporting requirements inherent in the CPFF structure. Transparency is facilitated by the contract award notice, but detailed programmatic oversight information is typically not publicly disclosed. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Research, Development, Test, and Evaluation (RDT&E)
Department of the Navy Engineering Services Contracts
Science Applications International Corporation (SAIC) Defense Contracts
Cost-Plus-Fixed-Fee (CPFF) Contracts
Full and Open Competition Awards

Risk Flags

Limited Competition (2 Bidders)
Cost-Plus Contract Type Risk
RDT&E Uncertainty

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $5.4 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. RDT&E (OUSD) SERVICES - BASE

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 $5.4 million.

What is the period of performance?

Start: 2022-05-11. End: 2026-05-15.

What is the specific nature of the RDT&E engineering services being provided under this contract?

The provided data indicates the contract is for 'RDT&E (OUSD) SERVICES - BASE' and falls under the North American Industry Classification System (NAICS) code 541330, which is Engineering Services. However, the specific RDT&E focus (e.g., specific weapon systems, cybersecurity, aerospace technology) is not detailed in the summary data. This level of detail is crucial for a comprehensive understanding of the contract's purpose and value. Without it, comparisons to other RDT&E contracts are generalized. The 'BASE' designation might imply a foundational or core set of services rather than highly specialized or advanced development.

How does the awarded amount of $5.37 million compare to similar RDT&E engineering service contracts awarded by the Department of Defense in the last fiscal year?

Benchmarking the $5.37 million award requires access to a broader dataset of recent DoD RDT&E engineering service contracts. However, for a contract spanning approximately four years (1465 days), this value suggests a moderate-sized engagement. Larger, more complex RDT&E programs can easily reach hundreds of millions or billions of dollars. Smaller, more focused RDT&E efforts might be in the low millions. Given SAIC's profile as a major defense contractor, this amount is likely for a specific, defined scope within a larger RDT&E portfolio, representing a fair investment for specialized engineering support.

What are the key performance indicators (KPIs) or milestones associated with this delivery order, and how has SAIC historically performed on similar contracts?

Specific KPIs and milestones for this delivery order are not detailed in the provided summary data. Typically, CPFF contracts include requirements for meeting technical objectives, adhering to schedules, and managing costs within the fixed fee framework. SAIC is a large, established defense contractor with a long history of performance across numerous government contracts. While past performance is generally a factor in award decisions, a detailed assessment would require reviewing SAIC's specific performance history on prior DoD RDT&E contracts, including any past issues with cost, schedule, or technical delivery.

What is the risk profile associated with a Cost Plus Fixed Fee (CPFF) contract for RDT&E services, and what oversight mechanisms are in place?

CPFF contracts for RDT&E carry inherent risks. While the fixed fee provides the contractor an incentive to control costs, the 'cost plus' portion means the government bears the risk of actual costs incurred. For RDT&E, where outcomes can be uncertain, this risk is amplified. Effective oversight is critical, involving rigorous monitoring of expenditures, regular progress reviews against milestones, and strong contract administration by the Navy. The Department of Defense typically employs program managers, contracting officers, and potentially auditors to ensure costs are reasonable and allocable, and that the contractor is making a good-faith effort to manage expenses within the fee structure.

How does the geographic concentration of this contract in California potentially impact the broader defense engineering landscape?

The award to a California-based contractor (SAIC) for $5.37 million in RDT&E engineering services reinforces the state's significant role in the defense industrial base. California hosts a large ecosystem of aerospace, defense, and technology companies, along with major military installations and research institutions. This contract contributes to that ecosystem by funding specialized engineering work, potentially supporting local high-skilled jobs and fostering innovation within the region. It also signifies the Navy's reliance on the expertise available in this geographic hub for critical RDT&E functions.

Given the 'FULL AND OPEN COMPETITION' and only two bidders, what does this suggest about the market for these specific engineering services?

The fact that this contract was competed under 'FULL AND OPEN COMPETITION' but only attracted two bidders suggests a potentially concentrated market for these specific RDT&E engineering services. This could mean that only a limited number of companies possess the highly specialized technical capabilities, security clearances, and experience required by the Department of the Navy for this particular scope of work. While competition is present, a smaller bidder pool might limit the downward pressure on pricing compared to a market with numerous qualified vendors. It highlights the importance of understanding the specific technical requirements and the available vendor landscape.

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: N6600120R3412

Offers Received: 2

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: $7,166,424

Exercised Options: $6,448,439

Current Obligation: $5,374,250

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $192,463

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6600121D0061

IDV Type: IDC

Timeline