DoD's $6.3M MAGIC Support contract awarded to The Informatics Applications Group, Inc. for engineering services

Contract Overview

Contract Amount: $6,327,578 ($6.3M)

Contractor: THE Informatics Applications Group, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-01-04

End Date: 2027-01-03

Contract Duration: 1,095 days

Daily Burn Rate: $5.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: MODERNIZATION APPLICATION GROWTH AND INNOVATION CENTER (MAGIC) SUPPORT.

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20170

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $6.3 million to THE INFORMATICS APPLICATIONS GROUP, INC. for work described as: MODERNIZATION APPLICATION GROWTH AND INNOVATION CENTER (MAGIC) SUPPORT. Key points: 1. Contract value appears reasonable given the 3-year duration and specialized nature of IT modernization support. 2. Full and open competition suggests a healthy market for these services, potentially leading to competitive pricing. 3. The cost-plus-fixed-fee structure requires careful monitoring to ensure cost control and prevent scope creep. 4. This contract supports critical IT modernization efforts within the Department of the Navy. 5. The Informatics Applications Group, Inc. is positioned to deliver specialized engineering expertise. 6. Performance will be key to achieving the modernization goals outlined for the MAGIC program.

Value Assessment

Rating: good

The contract's total value of approximately $6.3 million over three years translates to roughly $2.1 million annually. This seems within a reasonable range for specialized IT modernization and engineering support services, especially for a federal agency like the Department of the Navy. Benchmarking against similar contracts for IT system development and engineering services would provide a more precise value-for-money assessment, but the initial figures do not raise immediate red flags.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The presence of 7 bidders suggests a competitive environment, which typically benefits the government by driving down prices and encouraging innovation. This level of competition is a positive sign for price discovery and ensures the government is likely receiving a fair market price for the services rendered.

Taxpayer Impact: Taxpayers benefit from the competitive bidding process, which helps ensure that the government is not overpaying for essential IT modernization services. The wide participation also suggests a robust market, meaning funds are likely being used efficiently.

Public Impact

The Department of the Navy benefits through enhanced IT systems and modernization capabilities. Services delivered will focus on application growth and innovation within the MAGIC program. The geographic impact is primarily within the Department of the Navy's operational areas, likely supporting personnel and systems nationwide. Workforce implications include the potential for skilled IT professionals to be engaged in critical modernization projects.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can incentivize contractors to increase costs to maximize profit if not closely managed.
The duration of the contract (3 years) requires ongoing performance monitoring to ensure sustained quality and value.
Reliance on a single contractor for specialized IT modernization could pose a risk if performance falters or key personnel depart.

Positive Signals

Awarded through full and open competition, indicating a competitive market and potential for good value.
The contract supports critical IT modernization, aligning with strategic government objectives.
The Informatics Applications Group, Inc. is likely selected based on demonstrated expertise in engineering and IT services.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on engineering and application modernization. The federal IT services market is substantial, with significant spending allocated annually to maintain and upgrade legacy systems while developing new capabilities. This contract represents a portion of the Department of the Navy's investment in ensuring its technological infrastructure remains current and effective, fitting into a larger trend of digital transformation across government agencies.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). While there is no direct indication of small business subcontracting requirements in the provided data, the full and open competition nature suggests that larger prime contractors may engage small businesses as subcontractors. Further analysis would be needed to determine the extent of small business participation in the overall contract performance.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy's contracting officers and program managers. Performance metrics and deliverables will be key to monitoring progress and ensuring accountability. Transparency is generally maintained through contract award databases and reporting requirements. The Inspector General's office for the Department of Defense may have jurisdiction for audits and investigations if any issues arise.

Related Government Programs

Department of Defense IT Modernization Programs
Navy Information Technology Services
Application Development and Support Contracts
Engineering Services for Federal Agencies
MAGIC Program Support

Risk Flags

Cost-plus-fixed-fee contract requires diligent oversight to manage costs.
Performance monitoring is essential for a 3-year contract duration.
Potential for contractor dependency if key personnel are not retained.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $6.3 million to THE INFORMATICS APPLICATIONS GROUP, INC.. MODERNIZATION APPLICATION GROWTH AND INNOVATION CENTER (MAGIC) SUPPORT.

Who is the contractor on this award?

The obligated recipient is THE INFORMATICS APPLICATIONS GROUP, 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 $6.3 million.

What is the period of performance?

Start: 2024-01-04. End: 2027-01-03.

What is the track record of The Informatics Applications Group, Inc. with the Department of Defense or similar federal agencies?

A thorough review of The Informatics Applications Group, Inc.'s past performance is crucial. This would involve examining their history of delivering similar IT modernization and engineering services to federal agencies, particularly within the Department of Defense or Department of the Navy. Key aspects to investigate include their on-time delivery rates, adherence to budget, quality of work, and any past performance evaluations or awards. Understanding their experience with cost-plus-fixed-fee contracts and their ability to manage complex projects will provide insight into their capability to successfully execute this MAGIC Support contract. Information from contract databases and agency performance records would be essential for this assessment.

How does the annual value of this contract compare to similar IT modernization efforts within the Navy or DoD?

The annual value of approximately $2.1 million for this contract needs to be benchmarked against comparable IT modernization and engineering services procured by the Department of the Navy and the broader Department of Defense. This comparison should consider contracts of similar duration, scope, and complexity. Factors such as the specific technologies involved, the level of customization required, and the contractor's overhead structure will influence pricing. If this contract's annual cost is significantly higher or lower than similar procurements, it warrants further investigation into the reasons behind the discrepancy, which could indicate either exceptional value or potential overpricing.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for IT modernization?

Cost Plus Fixed Fee (CPFF) contracts, while offering flexibility for evolving requirements common in IT modernization, carry inherent risks. The primary risk for the government is that the contractor may have less incentive to control costs compared to fixed-price contracts, as their profit is fixed regardless of the actual costs incurred. This can lead to potential cost overruns if not meticulously managed. For the contractor, the risk lies in accurately estimating the fixed fee, as unforeseen complexities could erode their profit margin. Effective oversight, detailed cost tracking, and robust change management processes are critical to mitigate these risks and ensure the government receives good value.

What specific IT modernization goals does the MAGIC Support contract aim to achieve for the Department of the Navy?

The MAGIC Support contract is intended to facilitate application growth and innovation within the Department of the Navy's IT infrastructure. While the provided data does not detail specific goals, such contracts typically aim to upgrade legacy systems, enhance cybersecurity, improve data management and analytics capabilities, and enable the adoption of new technologies like cloud computing or artificial intelligence. The 'application growth and innovation' phrasing suggests a focus on developing new functionalities, improving user experience, and ensuring that the Navy's applications are scalable and adaptable to future needs. The success of the contract will be measured by the tangible improvements in these areas.

How has the Department of the Navy's spending on engineering and IT support services evolved over the past five years?

Analyzing the Department of the Navy's historical spending on engineering and IT support services over the past five years would provide valuable context for this $6.3 million contract. This trend analysis would reveal whether spending in this category has been increasing, decreasing, or remaining stable. Understanding this pattern can help assess if the current contract award is consistent with historical investment levels or represents a significant shift in priorities or budget allocation. It can also highlight any major programs or initiatives that have driven past spending, offering insights into the potential long-term trajectory of such procurements.

What is the significance of the 'Engineering Services' (NAICS 541330) classification for this contract?

The NAICS code 541330, 'Engineering Services,' signifies that the primary purpose of this contract is to procure professional engineering expertise. For an IT modernization effort, this implies that the contractor will be involved in the design, development, analysis, and potentially the implementation of complex technological systems. It suggests a need for specialized knowledge in areas such as systems architecture, software engineering, network engineering, and potentially cybersecurity engineering. This classification differentiates the contract from purely software development or IT support services, indicating a higher level of technical design and problem-solving is expected from The Informatics Applications Group, Inc.

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: N6600123R3518

Offers Received: 7

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: THE Informatics Applications Group Inc.

Address: 11911 FREEDOM DR, SUITE 1180, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $10,861,020

Exercised Options: $6,327,578

Current Obligation: $6,327,578

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017819D7821

IDV Type: IDC

Timeline