DoD's $147.5M IT Support Contract Awarded to Jacobs Technology Inc. for Custom Computer Programming

Contract Overview

Contract Amount: $147,488,466 ($147.5M)

Contractor: Jacobs Technology Inc.

Awarding Agency: Department of Defense

Start Date: 2011-04-20

End Date: 2014-09-26

Contract Duration: 1,255 days

Daily Burn Rate: $117.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: IT SUPPORT SERVICES

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35806

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $147.5 million to JACOBS TECHNOLOGY INC. for work described as: IT SUPPORT SERVICES Key points: 1. The contract's value of $147.5 million over its duration suggests a significant investment in IT support. 2. Awarded under full and open competition, this contract likely benefited from a competitive bidding process. 3. The Cost Plus Fixed Fee (CPFF) pricing structure carries inherent risks of cost overruns if not managed diligently. 4. The contract duration of 1255 days indicates a long-term need for these IT services. 5. The specific NAICS code (541511) points to a focus on custom computer programming, a critical area for IT infrastructure. 6. The contract was awarded to a single entity, Jacobs Technology Inc., highlighting their role in fulfilling this requirement.

Value Assessment

Rating: fair

Benchmarking the value of this $147.5 million contract requires detailed comparison to similar IT support services contracts within the Department of Defense and across government. The CPFF structure, while allowing flexibility, can lead to higher costs compared to fixed-price contracts if cost controls are not robust. Without specific performance metrics or comparable per-unit costs, a definitive value-for-money assessment is challenging, but the scale suggests a substantial need for these services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. This approach generally fosters a competitive environment, potentially leading to better pricing and service offerings for the government. The presence of 4 bids suggests a reasonable level of interest, though the exact number of bidders doesn't inherently guarantee optimal price discovery without further analysis of bid competitiveness.

Taxpayer Impact: A full and open competition is generally favorable for taxpayers as it aims to secure the best value through a wide range of potential providers, driving down costs and improving service quality.

Public Impact

The primary beneficiaries are the Department of Defense and its various branches, receiving essential IT support services. The contract delivers custom computer programming services, crucial for maintaining and enhancing the Army's technological infrastructure. The geographic impact is primarily within Alabama (ST: AL), where the contract was administered. The contract supports a workforce involved in specialized IT and programming roles, contributing to the tech sector employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contracts can incentivize contractors to incur more costs than necessary to increase their fixed fee, potentially leading to higher overall expenditure.
The long duration of the contract (1255 days) increases the risk of scope creep or evolving technological needs not being adequately addressed within the original contract terms.
Lack of specific performance metrics in the provided data makes it difficult to assess the contractor's efficiency and effectiveness throughout the contract period.
The absence of small business subcontracting information raises questions about opportunities for smaller businesses to participate in this large federal contract.

Positive Signals

Awarded under full and open competition, suggesting a robust and fair bidding process that likely yielded competitive proposals.
The contract addresses a critical need for custom computer programming services, indicating a strategic investment in the Department of Defense's IT capabilities.
The single award to Jacobs Technology Inc. implies they met all the stringent requirements and offered a compelling solution for the Army's needs.
The contract's significant value suggests a comprehensive scope of work designed to provide substantial IT support.

Sector Analysis

This contract falls within the IT Support Services sector, specifically focusing on custom computer programming. The IT services market is vast and highly competitive, with government contracts representing a significant portion. Comparable spending benchmarks would involve analyzing other large-scale IT support and software development contracts awarded by federal agencies, particularly within the defense sector, to gauge if the $147.5 million price point is in line with market rates for similar services and durations.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (SB: false) and does not explicitly mention subcontracting plans. This suggests that large businesses were the primary focus for this requirement. The lack of small business set-aside or reported subcontracting could mean missed opportunities for the small business ecosystem to engage with this significant federal spending, potentially limiting their access to government contracts and related revenue streams.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program office within the Department of the Army. Accountability measures would be tied to the Cost Plus Fixed Fee (CPFF) structure, requiring detailed cost reporting and justification from the contractor. Transparency is generally facilitated through contract databases like FPDS, where basic award information is publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

IT Professional Services
Custom Computer Programming Services
Department of Defense IT Contracts
Army IT Support
Cost-Plus Contracts

Risk Flags

Cost Plus Fixed Fee (CPFF) contract type can lead to higher costs if not managed properly.
Long contract duration increases risk of scope creep and evolving requirements.
Lack of detailed performance metrics in provided data hinders value assessment.
Potential for missed small business subcontracting opportunities.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $147.5 million to JACOBS TECHNOLOGY INC.. IT 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 $147.5 million.

What is the period of performance?

Start: 2011-04-20. End: 2014-09-26.

What was the specific performance history of Jacobs Technology Inc. on similar government contracts prior to this award?

Assessing Jacobs Technology Inc.'s prior performance is crucial for understanding their capability to execute this $147.5 million contract. While the provided data doesn't detail their track record, a thorough analysis would involve reviewing past contract awards, performance evaluations (e.g., CPARS reports), and any history of disputes or contract modifications. Agencies typically consider a contractor's past performance as a key factor in award decisions. A history of successful delivery on complex IT projects, adherence to schedules, and effective cost management would indicate a lower risk for this current contract. Conversely, a pattern of underperformance or significant issues on previous contracts would raise concerns about Jacobs Technology Inc.'s ability to meet the Department of the Army's requirements effectively and efficiently.

How does the estimated cost per day or per hour for this contract compare to industry benchmarks for custom computer programming services?

To benchmark the value, we would need to estimate a daily or hourly rate from the total contract value and duration. The contract is valued at $147,488,466.47 and spans 1255 days. This yields an approximate daily cost of $117,521.97. Comparing this to industry benchmarks for custom computer programming services requires access to detailed market data, which varies significantly based on skill sets, location, and complexity. However, this daily rate can be further broken down by assuming an average number of labor hours per day (e.g., 8 hours) to derive an hourly rate. If we assume 8 hours per day, the hourly rate would be approximately $14,690.25. This rate needs to be compared against government-wide IT services schedules (like GSA MAS) and private sector IT consulting rates for similar skill sets to determine if it represents good value for money. Factors like overhead, profit, and direct labor costs influence this comparison.

What were the primary risks identified by the Department of the Army during the solicitation process for this contract, and how were they mitigated?

The provided data does not explicitly detail the risks identified by the Department of the Army during the solicitation for this contract. However, common risks associated with large IT support and custom programming contracts include technical challenges, schedule delays, cost overruns (especially with CPFF contracts), cybersecurity vulnerabilities, and contractor performance issues. Given the CPFF structure, cost control and contractor efficiency would likely be key areas of focus. Mitigation strategies might have included stringent reporting requirements, performance metrics, regular progress reviews, and clear definition of work scope. The selection of Jacobs Technology Inc. suggests that the Army assessed their proposed mitigation plans and overall risk posture as acceptable.

What specific IT systems or programs will this contract support, and what is their criticality to the Department of the Army's mission?

The contract specifies 'Custom Computer Programming Services' under NAICS code 541511, indicating a focus on developing or modifying software tailored to the Army's unique requirements. The criticality of these systems to the Department of the Army's mission can range widely, from administrative and logistical support to operational command and control systems. Without more specific details on the systems being developed or maintained, it's difficult to ascertain their exact criticality. However, any custom programming for a branch of the military is generally considered important for maintaining operational readiness, enhancing capabilities, or ensuring the effective functioning of essential military functions. The substantial value and duration suggest these are not minor enhancements but likely core IT infrastructure or mission-critical applications.

How has federal spending on IT support services, particularly custom computer programming, trended over the past 5-10 years, and where does this contract fit within that trend?

Federal spending on IT support services, including custom computer programming, has generally seen a consistent upward trend over the past decade, driven by modernization efforts, increasing cybersecurity needs, and the adoption of cloud technologies. Agencies across the government, especially defense and intelligence, rely heavily on specialized IT services to maintain and upgrade complex systems. This $147.5 million contract awarded in 2011 fits within this trend as a significant investment in custom programming capabilities for the Department of the Army. Its value is substantial, reflecting the ongoing demand for tailored software solutions within the defense sector. Analyzing historical spending data for NAICS 541511 and broader IT services categories would reveal if this contract's value is typical for its time and scope, or if it represents an outlier due to specific project requirements or market conditions.

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: $147,488,466

Exercised Options: $147,488,466

Current Obligation: $147,488,466

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline