Leidos, Inc. awarded $40.3M contract for technical services, raising questions about competition and value
Contract Overview
Contract Amount: $40,316,632 ($40.3M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2012-08-30
End Date: 2013-02-28
Contract Duration: 182 days
Daily Burn Rate: $221.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: DEFINITIZATION OF UCA FOR CITP
Place of Performance
Location: NEW YORK, NEW YORK County, NEW YORK, 10038
State: New York Government Spending
Plain-Language Summary
Department of Defense obligated $40.3 million to LEIDOS, INC. for work described as: DEFINITIZATION OF UCA FOR CITP Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery and potentially increasing costs. 2. The contract duration of 182 days suggests a short-term need or a bridge to a future, larger award. 3. Analysis of value for money is challenging without competitive benchmarks or detailed cost breakdowns. 4. The 'All Other Professional, Scientific, and Technical Services' NAICS code is broad, making direct comparisons difficult. 5. Oversight and accountability are crucial given the sole-source nature of the award. 6. The firm fixed-price structure provides some cost certainty for the government.
Value Assessment
Rating: questionable
Benchmarking the value of this $40.3 million contract is difficult due to its sole-source nature and the broad NAICS code (541990). Without competitive bids, it's hard to ascertain if the pricing reflects fair market value. The short duration of 182 days might indicate a specific, time-bound project, but the overall cost per day is substantial. Further analysis would require access to the contractor's cost proposal and a comparison to similar, competitively awarded contracts for specialized technical services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a 'NOT COMPETED' basis, indicating that a full and open competition was not conducted. This typically occurs when only one source is capable of meeting the requirement, or in cases of urgent need. The lack of multiple bidders means there was no opportunity for price negotiation through a competitive process, which can lead to higher costs for the government compared to fully competed contracts.
Taxpayer Impact: Taxpayers may have paid a premium for this service due to the absence of competitive pressure to drive down prices. The government did not benefit from the cost-saving mechanisms inherent in a competitive bidding environment.
Public Impact
The primary beneficiary is the Department of the Army, receiving specialized technical services. The services provided fall under 'All Other Professional, Scientific, and Technical Services,' suggesting a broad range of potential support. The contract's geographic impact is noted as New York (ST: NY, SN: NEW YORK), indicating services were likely performed or managed from this location. Workforce implications are tied to Leidos, Inc., which would utilize its personnel to fulfill the contract requirements.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition raises concerns about potential overpayment and reduced value for taxpayer dollars.
- The broad NAICS code makes it difficult to assess if specialized expertise was truly unique to the awarded contractor.
- The short contract duration might indicate a lack of long-term strategic planning or a stop-gap measure.
- Transparency regarding the justification for sole-source award is limited in the provided data.
Positive Signals
- The firm fixed-price contract type offers cost predictability for the government.
- Leidos, Inc. is a large, established government contractor, suggesting a degree of reliability and capability.
- The contract is for essential technical services, implying a necessary function for the Department of the Army.
Sector Analysis
The professional, scientific, and technical services sector is a significant component of federal contracting. This contract falls under NAICS code 541990, 'All Other Professional, Scientific, and Technical Services,' which is a broad category encompassing a wide array of specialized support. Federal spending in this sector is substantial, often driven by complex requirements in areas like research, engineering, and specialized consulting. Without more specific details on the services rendered, it's challenging to benchmark against comparable contracts, but the overall market for such services is robust and competitive when open competition is utilized.
Small Business Impact
This contract does not appear to have a small business set-aside (SS: false, SB: false). As a sole-source award to a large prime contractor (Leidos, Inc.), there is a potential missed opportunity for small businesses to participate either as prime contractors or subcontractors. The implications for the small business ecosystem depend on whether Leidos, Inc. intends to subcontract portions of this work to small businesses, which is not specified in the provided data.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. Given the sole-source nature, scrutiny should be particularly high to ensure the necessity of the services and the fairness of the price. Transparency regarding the justification for the non-competitive award and the performance metrics would be key accountability measures. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Department of Defense IT Services
- Army Professional Services Contracts
- Technical Support Services
- All Other Professional, Scientific, and Technical Services
Risk Flags
- Sole-source award
- Broad NAICS code
- Lack of transparency on justification
- High dollar value for short duration
Tags
defense, department-of-the-army, leidos-inc, definitive-contract, firm-fixed-price, not-competed, sole-source, professional-scientific-and-technical-services, new-york, other-services, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $40.3 million to LEIDOS, INC.. DEFINITIZATION OF UCA FOR CITP
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 $40.3 million.
What is the period of performance?
Start: 2012-08-30. End: 2013-02-28.
What specific technical services were provided under this contract?
The provided data indicates the contract is for 'DEFINITIZATION OF UCA FOR CITP' (DEFINITIZATION OF UNILATERAL CONTRACT ACTION FOR CITP). While 'CITP' is not explicitly defined, the NAICS code 541990 ('All Other Professional, Scientific, and Technical Services') suggests a broad range of support. This could encompass areas such as program management, technical consulting, systems engineering, or specialized analysis related to a specific Army initiative. Without further details on 'CITP' and the specific tasks outlined in the contract's Statement of Work (SOW), the exact nature of the services remains generalized.
How does the $40.3 million cost compare to similar sole-source technical service contracts?
Direct comparison of this $40.3 million sole-source contract is challenging without knowing the specific services rendered and their complexity. Sole-source contracts inherently lack the price discovery mechanism of competition, potentially leading to higher costs. To assess value, one would need to compare it against similar, competitively awarded contracts for comparable services, factoring in duration, scope, and contractor expertise. The broad NAICS code further complicates direct benchmarking. However, for a contract lasting approximately six months (182 days), $40.3 million represents a significant investment, underscoring the need for robust justification for the sole-source award.
What are the risks associated with awarding a contract of this magnitude on a sole-source basis?
The primary risk of a sole-source award, especially for a contract valued at $40.3 million, is the potential for inflated pricing due to the absence of competitive pressure. This can lead to inefficient use of taxpayer funds. Another risk is the lack of innovation that competition often fosters. Furthermore, it raises questions about whether the government adequately explored all avenues for competition or if there were specific circumstances (like urgency or unique capabilities) that genuinely precluded it. Robust oversight and justification documentation are critical to mitigate these risks.
What is the track record of Leidos, Inc. in providing similar technical services to the Department of Defense?
Leidos, Inc. is a major defense contractor with a substantial history of providing a wide array of technical, IT, and professional services to the Department of Defense and other federal agencies. They have experience across numerous domains, including command and control systems, intelligence support, logistics, and cybersecurity. While their overall track record is extensive, the specific performance on this particular contract (DEFINITIZATION OF UCA FOR CITP) would require examining contract performance reports (like CPARS) and any associated quality or delivery issues. Their size and experience suggest capability, but performance can vary by contract.
What does the short contract duration (182 days) imply about the nature of the requirement?
A contract duration of 182 days (approximately six months) for a $40.3 million award suggests several possibilities. It could represent a bridge contract, intended to provide services while a larger, long-term contract is being competed or finalized. Alternatively, it might be for a very specific, short-term project with a defined deliverable. It could also indicate a rapid response requirement or a task that was not initially planned for in longer-term budgeting. The short timeframe, coupled with the sole-source award, warrants scrutiny to ensure it aligns with strategic program needs and doesn't represent a missed opportunity for more comprehensive planning.
How does the 'All Other Professional, Scientific, and Technical Services' NAICS code impact the analysis of this contract?
The broadness of NAICS code 541990 presents a significant challenge for detailed analysis. It encompasses a vast array of services, making it difficult to find directly comparable contracts for benchmarking price and performance. This lack of specificity means the 'technical services' could range from highly specialized scientific research to general administrative support. For analysts, it necessitates digging deeper into the contract's specific Statement of Work (SOW) to understand the actual services procured and to identify more precise industry benchmarks, rather than relying solely on the general NAICS code classification.
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: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc. (UEI: 611641312)
Address: 1710 SAIC DR, MCLEAN, VA, 22102
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $40,316,632
Exercised Options: $40,316,632
Current Obligation: $40,316,632
Subaward Activity
Number of Subawards: 44
Total Subaward Amount: $20,502,880
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2012-08-30
Current End Date: 2013-02-28
Potential End Date: 2013-02-28 12:02:00
Last Modified: 2017-09-26
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