Leidos Inc. awarded $150.9M for Army systemization, operations, and closure support
Contract Overview
Contract Amount: $150,930,189 ($150.9M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2018-09-06
End Date: 2026-09-23
Contract Duration: 2,939 days
Daily Burn Rate: $51.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: BASIC CONTRACT FOR SYSTEMIZATION, OPERATIONS, AND CLOSURE SUPPORT (SOCS)
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $150.9 million to LEIDOS, INC. for work described as: BASIC CONTRACT FOR SYSTEMIZATION, OPERATIONS, AND CLOSURE SUPPORT (SOCS) Key points: 1. Contract value of $150.9M over nearly 8 years suggests significant long-term support needs. 2. Full and open competition indicates a potentially competitive bidding process. 3. The contract type (Cost Plus Fixed Fee) may lead to cost overruns if not managed closely. 4. Services encompass systemization, operations, and closure, indicating a broad scope of support. 5. The 'All Other Professional, Scientific, and Technical Services' NAICS code suggests a diverse range of activities. 6. Contract awarded to Leidos, Inc., a major federal contractor, implying established capabilities.
Value Assessment
Rating: fair
The contract value of $150.9M over approximately 8 years averages to about $18.9M annually. Benchmarking this against similar large-scale support contracts for the Department of Defense is challenging without more specific service details. The Cost Plus Fixed Fee (CPFF) contract type, while allowing flexibility, carries inherent risks of cost escalation if the fixed fee becomes disproportionately small compared to actual costs incurred. This pricing structure requires robust oversight to ensure value for money.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting that multiple bidders were likely invited to submit proposals. The presence of two bidders (no) indicates a degree of competition, but the exact number of proposals received and the evaluation process are not detailed. A competitive process is generally favorable for price discovery and ensuring the government receives the best value.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it encourages multiple companies to bid, potentially driving down costs and improving service quality through competitive pressure.
Public Impact
The Department of the Army benefits from comprehensive support for systemization, operations, and closure activities. This contract likely supports military readiness and operational efficiency by ensuring systems are properly managed and closed out. The geographic impact is primarily within the United States, given the Army's domestic operational footprint, though specific locations are not detailed. Workforce implications may include the creation or sustainment of jobs for technical and professional services personnel.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type can incentivize contractors to increase costs to maximize profit if not properly managed.
- The broad NAICS code 'All Other Professional, Scientific, and Technical Services' may obscure the specific nature and cost drivers of the services provided.
- Limited information on the number of bidders and proposal details makes it difficult to fully assess the competitiveness of the award.
Positive Signals
- Awarded under full and open competition, indicating a potentially robust bidding process.
- Leidos, Inc. is a large, established contractor with significant experience in government services, suggesting a lower risk of performance failure.
- The contract duration of nearly 8 years suggests a stable, long-term need for these critical support services.
Sector Analysis
This contract falls within the professional, scientific, and technical services sector, a broad category encompassing a wide array of support functions for government agencies. The market for these services is highly competitive, with numerous large and small businesses vying for contracts. The Department of Defense is a major consumer of such services, utilizing them for everything from IT support to complex logistical and operational functions. The value of this contract, at over $150M, places it in the mid-to-large tier for individual service contracts within this sector.
Small Business Impact
The data indicates this contract was not set aside for small businesses (sb: false) and does not explicitly mention subcontracting goals for small businesses (ss: false). This suggests that the primary award went to a large business, Leidos, Inc. While there are no direct set-aside provisions, large prime contractors are often encouraged or required to subcontract a portion of their work to small businesses. The impact on the small business ecosystem will depend on whether Leidos actively pursues small business subcontractors for specialized services within the scope of this contract.
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. The Cost Plus Fixed Fee structure necessitates close monitoring of costs and performance to ensure adherence to the contract terms and prevent unnecessary expenditures. Transparency is facilitated through contract reporting requirements, and the Inspector General's office for the Department of Defense would have jurisdiction to investigate any allegations of fraud, waste, or abuse.
Related Government Programs
- Department of Defense Logistics and Readiness Support Contracts
- Army Systems Engineering and Integration Services
- Professional and Technical Services for Government Operations
- Contract Closeout and Archiving Services
Risk Flags
- Cost Plus Fixed Fee contract type requires diligent oversight to manage potential cost overruns.
- Broad NAICS code may limit transparency into specific service costs and performance metrics.
- Limited data on the number of competitors makes full assessment of competition dynamics challenging.
Tags
defense, department-of-defense, department-of-the-army, professional-scientific-technical-services, definitive-contract, full-and-open-competition, cost-plus-fixed-fee, large-contract, leidos-inc, virginia, systemization, operations
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $150.9 million to LEIDOS, INC.. BASIC CONTRACT FOR SYSTEMIZATION, OPERATIONS, AND CLOSURE SUPPORT (SOCS)
Who is the contractor on this award?
The obligated recipient is LEIDOS, 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 $150.9 million.
What is the period of performance?
Start: 2018-09-06. End: 2026-09-23.
What is the specific breakdown of services provided under 'Systemization, Operations, and Closure Support (SOCS)'?
The provided data offers a high-level overview of the contract's purpose but lacks granular detail on the specific tasks encompassed by 'Systemization, Operations, and Closure Support (SOCS)'. Systemization typically involves establishing or optimizing systems, which could range from IT infrastructure to operational processes. Operations implies ongoing management and execution of these systems. Closure support likely refers to the processes involved in decommissioning systems, projects, or facilities, including documentation, asset disposition, and final reporting. Without further documentation, it's difficult to ascertain the exact nature, complexity, and resource requirements for each component of the SOCS.
How does the $150.9M contract value compare to similar Army support contracts?
Comparing the $150.9M contract value for Leidos, Inc.'s SOCS services requires context regarding the specific nature of the support and the duration. Averaging approximately $18.9M annually over nearly 8 years, this represents a significant investment. However, without knowing the precise scope (e.g., number of systems, geographic reach, specific operational functions, complexity of closure activities), direct comparisons are difficult. The Department of the Army procures a vast array of support services, ranging from IT maintenance to large-scale logistical operations. This contract appears to be a substantial, long-term commitment, likely for critical support functions that demand consistent resources over an extended period. Benchmarking would ideally involve identifying contracts with similar service descriptions and durations within the Army or broader DoD.
What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract of this magnitude?
The primary risk with a Cost Plus Fixed Fee (CPFF) contract, especially one valued at $150.9M, is the potential for cost overruns. While the contractor is reimbursed for allowable costs, the fixed fee is predetermined. If costs escalate significantly beyond initial projections due to unforeseen complexities, scope creep, or inefficiencies, the contractor's profit margin shrinks. This can create an incentive for the contractor to manage costs tightly, but it also places a burden on the government to meticulously oversee expenditures to ensure they are reasonable and allocable. Furthermore, the government bears the risk of cost increases, while the contractor's profit is capped by the fixed fee, which can sometimes lead to disputes over cost allowability or contractor performance if the fee becomes insufficient compensation for the effort expended.
What is Leidos, Inc.'s track record with similar Department of Defense contracts?
Leidos, Inc. is a major government contractor with a substantial and long-standing presence supporting the Department of Defense (DoD) across various domains, including IT, logistics, intelligence, and healthcare. They have a history of managing large, complex contracts, often involving system integration, technical support, and operational services. While specific performance metrics for this particular SOCS contract are not detailed in the provided data, Leidos's overall track record with the DoD suggests they possess the organizational capacity and technical expertise to handle such requirements. However, like any large contractor, their performance can vary across individual contracts, and a deeper dive into past performance reviews and contract modifications would be necessary for a comprehensive assessment.
How has spending on 'All Other Professional, Scientific, and Technical Services' by the Department of the Army trended historically?
The NAICS code 541990, 'All Other Professional, Scientific, and Technical Services,' is a broad category that encompasses a diverse range of services not classified elsewhere. Historically, spending within this category by the Department of the Army, and the DoD overall, has been substantial and often fluctuates based on strategic priorities, operational tempo, and specific program needs. This category can include anything from specialized consulting and research to environmental services and technical support. Analyzing historical spending trends for this specific NAICS code requires access to detailed federal procurement data over multiple fiscal years. Without that data, it's difficult to provide a precise trend, but it's generally understood that the Army relies heavily on a wide array of professional services to fulfill its mission requirements.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W52P1J16R0032
Offers Received: 2
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 1750 PRESIDENTS ST, 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: $214,193,202
Exercised Options: $150,930,189
Current Obligation: $150,930,189
Actual Outlays: $10,233,119
Subaward Activity
Number of Subawards: 257
Total Subaward Amount: $58,458,182
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2018-09-06
Current End Date: 2026-09-23
Potential End Date: 2026-09-23 00:00:00
Last Modified: 2025-09-04
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