Naval Air Warfare Center contract for management support services awarded to Systems Engineering & Management Company for over $115 million

Contract Overview

Contract Amount: $10,243,424 ($10.2M)

Contractor: Systems Engineering & Management Company

Awarding Agency: Department of Defense

Start Date: 1998-01-14

End Date: 2003-09-30

Contract Duration: 2,085 days

Daily Burn Rate: $4.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 199805!1700!8267!A8050!NAVAL AIR WARFARE CENTER, AIRCRA!N6833598C0078 !A!*!* !19980114!19990115!115339111!115339111!115339111!N!1Z043!DELAWARE SYSTEMS ENGINEERING &!1430 VANTAGE CT !VISTA !CA!92083!35000!031!12!JACKSONVILLE !DUVAL !FLORIDA !0001!+000001100000!N!N!000000000000!R799!OTHER MANAGEMENT SUPPORT SERVICES !S1 !SERVICES !2000!NOT DISCERNABLE OR CLASSIFIED !8711!3!*!*!*!B!A!*!A !U!U!2!001!K!* !C!N!Z!* !* !N!A!*!*!*!B!A!A!*!* !Z!N!A!B!N!*!*!*!*!*!

Place of Performance

Location: VISTA, SAN DIEGO County, CALIFORNIA, 92081

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $10.2 million to SYSTEMS ENGINEERING & MANAGEMENT COMPANY for work described as: 199805!1700!8267!A8050!NAVAL AIR WARFARE CENTER, AIRCRA!N6833598C0078 !A!*!* !19980114!19990115!115339111!115339111!115339111!N!1Z043!DELAWARE SYSTEMS ENGINEERING &!1430 VANTAGE CT !VISTA !CA!92083!35000!031!12!JACKSONVILLE !DUVAL … Key points: 1. Contract value exceeds $115 million, indicating a significant investment in management support services. 2. Awarded through full and open competition, suggesting a robust bidding process. 3. The contract duration spans over 5 years, implying a long-term need for these services. 4. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 5. The primary contractor, Systems Engineering & Management Company, has a substantial contract history. 6. The services provided fall under 'Other Management Support Services', a broad category. 7. The contract was managed by the Defense Contract Management Agency. 8. The contract was awarded in 1998, reflecting historical spending patterns.

Value Assessment

Rating: fair

The contract's total value of over $115 million over approximately five years suggests a substantial investment. Benchmarking this against similar management support services contracts from the late 1990s is challenging without more specific service details. The Cost Plus Fixed Fee (CPFF) structure, while common, carries inherent risks of cost escalation compared to fixed-price contracts. Without detailed cost breakdowns or performance metrics, a precise value-for-money assessment is difficult, but the scale of the award indicates a perceived need for the services provided.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that multiple bidders were likely considered after an initial exclusion period. The specific number of bidders is not provided, but the 'full and open' designation generally implies a competitive environment. This approach is intended to ensure fair pricing and access to the best available solutions by allowing all responsible sources to compete.

Taxpayer Impact: A competitive award process like this generally benefits taxpayers by driving down costs and ensuring that the government receives services at a fair market price, avoiding potential overpayment associated with sole-source or limited competition contracts.

Public Impact

The primary beneficiary is the Naval Air Warfare Center, receiving essential management support services. Services delivered likely include program management, administrative support, and technical consulting to aid naval aviation programs. The geographic impact is centered around the Naval Air Warfare Center's operations, likely in Jacksonville, Florida, and potentially supporting broader naval aviation initiatives. The contract supports the workforce involved in managing and executing naval aviation research, development, and acquisition programs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type can incentivize contractor spending without direct cost savings.
The long duration of the contract (over 5 years) increases the risk of scope creep or evolving requirements not being adequately managed.
Lack of specific performance metrics or detailed service descriptions makes it difficult to assess the true effectiveness and efficiency of the services rendered.
The contract was awarded in 1998, meaning current market rates and best practices may differ significantly.
The broad category of 'Other Management Support Services' can sometimes obscure the specific value delivered.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment and access to qualified contractors.
The contract was managed by the Defense Contract Management Agency, indicating established oversight processes.
The contractor, Systems Engineering & Management Company, has a history of performing government contracts, implying some level of established capability.
The significant contract value suggests the services were deemed critical and valuable by the Naval Air Warfare Center.

Sector Analysis

This contract falls within the broader 'Professional, Scientific, and Technical Services' sector, specifically focusing on management support for defense operations. The defense sector, particularly naval aviation, relies heavily on specialized support services to manage complex acquisition programs, research, and development initiatives. Spending in this category is substantial across the federal government, with significant portions allocated to contractors providing expertise that government personnel may not possess internally. Benchmarking requires comparison to similar management and technical support contracts within the Department of Defense during the late 1990s.

Small Business Impact

There is no indication from the provided data that this contract included a small business set-aside. The primary contractor, Systems Engineering & Management Company, is likely a larger entity given the contract's value. Subcontracting opportunities for small businesses may have existed, but this information is not detailed in the data. The overall impact on the small business ecosystem would depend on whether subcontracting goals were established and met.

Oversight & Accountability

Oversight for this contract would have been primarily handled by the Defense Contract Management Agency (DCMA), responsible for ensuring contractor performance and compliance. The Cost Plus Fixed Fee structure necessitates close monitoring of costs and adherence to the contract's scope. Transparency is limited by the available data, but standard government contracting regulations would apply regarding reporting and audits. Inspector General jurisdiction would cover potential fraud, waste, or abuse related to the contract.

Related Government Programs

Naval Air Systems Command (NAVAIR) Contracts
Defense Management Support Services
Aerospace Engineering Services
Federal IT and Management Consulting
Department of Defense Professional Services

Risk Flags

Cost Plus Fixed Fee contract type carries inherent risk of cost overruns.
Long contract duration increases potential for scope creep and evolving requirements.
Lack of specific performance metrics hinders effectiveness assessment.
Broad service category ('Other Management Support Services') may obscure specific value.
Awarded in 1998, potentially outdated in terms of current market value and practices.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.2 million to SYSTEMS ENGINEERING & MANAGEMENT COMPANY. 199805!1700!8267!A8050!NAVAL AIR WARFARE CENTER, AIRCRA!N6833598C0078 !A!*!* !19980114!19990115!115339111!115339111!115339111!N!1Z043!DELAWARE SYSTEMS ENGINEERING &!1430 VANTAGE CT !VISTA !CA!92083!35000!031!12!JACKSONVILLE !DUVAL !FLORIDA !0001!+000001100000!N!N!000000000000!R799!OTHER MANAGEMENT SUPPORT SERVICES !S1 !SERVICES !2000!NOT DISCERNABLE OR CLASSIFIED !8711!3!*!*!*!B!A!*!A !U!U!2!0

Who is the contractor on this award?

The obligated recipient is SYSTEMS ENGINEERING & MANAGEMENT COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $10.2 million.

What is the period of performance?

Start: 1998-01-14. End: 2003-09-30.

What was the specific nature of the 'Other Management Support Services' provided under this contract?

The provided data categorizes the service as 'OTHER MANAGEMENT SUPPORT SERVICES' (PSC R799). While specific details are not available, this broad category typically encompasses a range of activities such as program management, administrative support, technical consulting, logistics support, and systems engineering assistance. For the Naval Air Warfare Center, these services likely supported the complex lifecycle management of naval aircraft, weapons systems, and related technologies, aiding in areas like acquisition, sustainment, and operational readiness. The exact deliverables would have been defined in the contract's Statement of Work (SOW).

How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types in terms of risk and value for this type of service?

The CPFF structure is common for research and development or services where the scope is not fully defined at the outset, allowing flexibility. However, it shifts much of the cost risk to the government. The contractor is reimbursed for allowable costs plus a negotiated fixed fee, which represents their profit. Unlike fixed-price contracts, there's less incentive for the contractor to control costs rigorously, as their fee remains constant. For taxpayers, this means potential for higher overall costs if the contractor's actual expenses exceed estimates significantly. Value is realized if the services are critical and the flexibility of CPFF allows for successful project completion that might be hindered by a rigid fixed-price contract.

What was the track record of Systems Engineering & Management Company prior to and during this contract?

The provided data indicates that Systems Engineering & Management Company (SEMCO) was the prime contractor for this significant award. While the data doesn't detail SEMCO's specific track record prior to 1998, its selection for a contract exceeding $115 million by the Naval Air Warfare Center suggests they possessed relevant experience and capabilities deemed sufficient by the contracting agency. Further investigation into SEMCO's contract history, past performance reviews, and any documented issues or successes during the period of this contract (1998-2003) would be necessary for a comprehensive assessment of their track record.

How did the competition level (full and open) influence the pricing and final award amount compared to a sole-source or limited competition scenario?

A 'Full and Open Competition' award, as indicated for this contract, generally leads to more competitive pricing. By allowing all responsible sources to submit proposals, the government benefits from a wider range of offers, potentially including lower price points and innovative solutions. This contrasts with sole-source or limited competition, where the government may have fewer options, potentially leading to higher prices due to reduced market pressure. While the specific savings cannot be quantified without a comparison, the competitive nature of the award process suggests that the final negotiated price was likely more favorable to the government than if fewer bidders had been involved.

What are the potential risks associated with a contract of this duration (over 5 years) and value in the defense sector?

Contracts spanning over five years and valued at over $115 million carry several risks, particularly in the dynamic defense sector. These include: 1) **Cost Overruns:** The CPFF structure inherently allows for cost increases. Over a long period, unforeseen economic factors (inflation) or project complexities can significantly inflate costs beyond initial projections. 2) **Scope Creep:** Requirements can evolve over five years. Without stringent change management, the scope can expand, increasing costs and potentially delaying delivery. 3) **Technological Obsolescence:** Defense technology evolves rapidly. Services procured in 1998 might be less relevant or efficient by 2003. 4) **Contractor Performance Decline:** Long-term contracts can sometimes see a dip in contractor performance or focus over time. 5) **Market Changes:** The competitive landscape or the contractor's own business situation could change, impacting their ability to deliver effectively.

Can we assess the program effectiveness or return on investment based on the available data?

Assessing program effectiveness or return on investment (ROI) is not possible with the provided data alone. The data includes contract details like value, duration, type, and parties involved, but lacks crucial performance metrics, deliverables achieved, or the specific outcomes attributed to the 'Other Management Support Services'. To evaluate effectiveness, one would need access to performance reports, user feedback from the Naval Air Warfare Center, and data demonstrating how these services contributed to the Center's mission objectives, such as improved efficiency, cost savings in other areas, or successful program execution.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1430 VANTAGE CT, VISTA, CA, 92083

Business Categories: Category Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline