DoD's $106M IT support contract to Jacobs Technology Inc. awarded via full and open competition

Contract Overview

Contract Amount: $106,301,982 ($106.3M)

Contractor: Jacobs Technology Inc.

Awarding Agency: Department of Defense

Start Date: 2009-04-30

End Date: 2012-12-08

Contract Duration: 1,318 days

Daily Burn Rate: $80.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: INFORMATION TECHNOLOGY SUPPORT SERVICES

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35898

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $106.3 million to JACOBS TECHNOLOGY INC. for work described as: INFORMATION TECHNOLOGY SUPPORT SERVICES Key points: 1. Contract awarded for IT support services, indicating a need for specialized technical expertise. 2. The contract was competed openly, suggesting a competitive environment for service providers. 3. A Cost Plus Fixed Fee (CPFF) pricing structure was used, which can shift risk to the government. 4. The contract duration of 1318 days (approx. 3.6 years) suggests a long-term need for these services. 5. The contract was awarded to a single entity, Jacobs Technology Inc., for the entire scope. 6. The North American Industry Classification System (NAICS) code 541511 points to custom computer programming services.

Value Assessment

Rating: fair

The contract's total value of approximately $106 million over 3.6 years averages to about $29.5 million annually. Without specific performance metrics or detailed cost breakdowns, it's challenging to benchmark the value for money definitively. The CPFF structure, while common for complex IT projects, can lead to higher costs if not managed closely, as the contractor is reimbursed for allowable costs plus a fixed fee. Comparing this to similar large-scale IT support contracts within the Department of Defense would provide a clearer picture of its cost-effectiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 4 bidders suggests a reasonably competitive landscape for this type of IT support service. A higher number of bidders generally leads to better price discovery and potentially lower costs for the government. The fact that it was competed openly is a positive sign for market efficiency.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation among contractors.

Public Impact

The Department of Defense benefits from enhanced IT infrastructure and support, crucial for its operations. Services delivered likely include custom programming, system integration, and ongoing IT maintenance. The contract's performance in Alabama (AL) suggests a focus on supporting DoD facilities or personnel within that state. The contract supports a workforce skilled in information technology, potentially including programmers, analysts, and support staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

CPFF contract type can lead to cost overruns if not managed diligently.
Lack of specific performance data makes it difficult to assess true value for money.
Reliance on a single contractor for a significant IT support scope could pose risks if performance degrades.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
Multiple bidders (4) participated, suggesting a healthy level of market interest.
The contract addresses a critical need for IT support within the Department of Defense.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on custom computer programming services (NAICS 541511). The IT services market is vast and highly competitive, with numerous companies offering specialized support. Large government contracts like this represent a significant portion of the market for IT service providers. Comparable spending benchmarks would involve looking at other large IT support contracts awarded by the DoD or other federal agencies for similar services and durations.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large contract awarded under full and open competition, it is likely that the prime contractor, Jacobs Technology Inc., may engage small businesses as subcontractors to fulfill specific aspects of the IT support requirements. However, without specific subcontracting plans or data, the direct impact on the small business ecosystem remains unclear, though large prime contractors often utilize small business partners.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program management office within the Department of the Army. Accountability measures would be defined in the contract's terms and conditions, including performance standards and reporting requirements. Transparency is generally facilitated through contract award databases like FPDS, though detailed performance data may be less accessible. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense IT Services
Custom Computer Programming Services
Information Technology Support Contracts
Federal IT Procurement
Cost Plus Fixed Fee Contracts

Risk Flags

Cost Plus Fixed Fee contract type
Potential for cost overruns
Limited transparency on performance metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $106.3 million to JACOBS TECHNOLOGY INC.. INFORMATION TECHNOLOGY SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is JACOBS TECHNOLOGY INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $106.3 million.

What is the period of performance?

Start: 2009-04-30. End: 2012-12-08.

What is the track record of Jacobs Technology Inc. in performing similar IT support contracts for the federal government?

Jacobs Technology Inc. has a significant history of performing IT support and related services for various federal agencies, including the Department of Defense. Their portfolio often includes complex engineering, technology, and professional services. Analyzing their past performance on similar Cost Plus Fixed Fee (CPFF) contracts, particularly those involving custom programming and large-scale IT infrastructure support, would reveal their ability to manage costs, meet deadlines, and deliver quality services. Past performance reviews and contract close-out data from federal procurement databases would be essential to assess their reliability and effectiveness in fulfilling government requirements. A review of their contract history might also highlight any past performance issues or commendations.

How does the average annual cost of this contract compare to similar IT support contracts awarded by the DoD?

This contract's average annual cost is approximately $29.5 million ($106M / 3.6 years). To benchmark this effectively, we would need to compare it against other definitive contracts for IT support services awarded by the Department of Defense within a similar timeframe (e.g., 2009-2012) and with comparable scope and complexity. Factors such as the specific services required (e.g., custom programming vs. general IT maintenance), the geographic location of service delivery, and the contract type (CPFF) influence pricing. If similar contracts for comparable services were awarded at a significantly lower or higher average annual cost, it would indicate whether this contract represents good or questionable value. Access to detailed pricing structures and performance metrics from comparable contracts is crucial for a robust comparison.

What are the primary risks associated with the Cost Plus Fixed Fee (CPFF) contract type used for this award?

The Cost Plus Fixed Fee (CPFF) contract type, while suitable for research and development or complex services where costs are uncertain, carries inherent risks for the government. The primary risk is that the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee. This structure incentivizes the contractor to incur costs, as their profit (the fixed fee) is not directly tied to cost savings. If cost controls are not rigorously maintained by the government's contracting officer and technical representatives, there is a risk of cost overruns. The government bears the financial risk of cost increases, while the contractor is assured of their fee, potentially leading to less incentive for cost efficiency compared to fixed-price contracts.

What is the potential impact of this contract on the IT services market in Alabama?

Given that the contract was awarded with a performance location in Alabama (ST: AL, SN: ALABAMA), it suggests a significant presence and operational focus for Jacobs Technology Inc. within the state. This could translate into job creation for IT professionals in Alabama, including programmers, system administrators, and support staff. The contract may also stimulate local IT ecosystems by requiring local resources, office space, or support services. Furthermore, it positions Jacobs Technology Inc. as a key IT service provider within the state, potentially leading to further business opportunities. The presence of a large federal contract can enhance the state's reputation as a hub for technology services.

How does the number of bidders (4) influence the government's ability to secure competitive pricing for IT support services?

Having four bidders for this IT support contract suggests a moderate level of competition. While more bidders generally lead to greater price pressure and potentially lower costs for the government, four bidders indicate that the market is sufficiently interested and capable of providing the required services. This number is often considered a reasonable baseline for effective competition. It allows for a range of proposals to be evaluated, providing the government with options and leverage during negotiations. However, a deeper analysis would involve understanding the specific qualifications and pricing strategies of each of the four bidders to determine if the competition truly drove optimal pricing outcomes or if there were barriers to entry for other potential competitors.

What specific types of custom computer programming services are likely covered under NAICS code 541511 for this contract?

NAICS code 541511, 'Custom Computer Programming Services,' typically encompasses a wide range of activities related to designing, developing, and implementing software and systems tailored to a client's specific needs. For this Department of Defense contract, this could include writing, modifying, testing, and supporting software code; developing custom applications; integrating different software systems; database programming; and potentially providing IT consulting services focused on software development. It generally excludes providing off-the-shelf software or hardware, or general IT support like network maintenance, unless directly tied to the development and implementation of custom software solutions. The services are characterized by their unique design and development for a specific user.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 4

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Jacobs Engineering Group Inc (UEI: 074103508)

Address: 1525 PERIMETER PKWY, SUITE 510, HUNTSVILLE, AL, 35806

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

Financial Breakdown

Contract Ceiling: $106,301,982

Exercised Options: $106,301,982

Current Obligation: $106,301,982

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline