Leidos, Inc. awarded $39.2M for Saturn Arch ISR Systems sustainment, a sole-source contract
Contract Overview
Contract Amount: $39,195,404 ($39.2M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2015-09-17
End Date: 2017-03-31
Contract Duration: 561 days
Daily Burn Rate: $69.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: CONTINUED OPERATIONS AND SUSTAINMENT OF SATURN ARCH ISR SYSTEMS. IGF::CL,CT::IGF
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $39.2 million to LEIDOS, INC. for work described as: CONTINUED OPERATIONS AND SUSTAINMENT OF SATURN ARCH ISR SYSTEMS. IGF::CL,CT::IGF Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Firm Fixed Price contract type suggests predictable costs for the government. 3. Contract duration of 561 days indicates a medium-term sustainment effort. 4. The contract falls under 'Other Support Activities for Air Transportation' NAICS code. 5. Awarded by the Department of the Army, indicating a defense-related need. 6. The contractor, Leidos, Inc., has a significant presence in defense and IT sectors.
Value Assessment
Rating: fair
The contract value of $39.2 million for a period of approximately 1.5 years for sustainment of ISR systems appears to be within a reasonable range for specialized defense support. However, without direct comparable contracts for the Saturn Arch ISR systems, a precise value-for-money assessment is challenging. The firm fixed-price structure aims to control costs, but the lack of competition could lead to less favorable pricing than a competed contract might achieve. Benchmarking against similar sustainment contracts for complex intelligence, surveillance, and reconnaissance (ISR) platforms would be necessary for a more definitive evaluation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor possesses the necessary capabilities, technology, or proprietary knowledge to fulfill the requirement. The lack of competition means that the government did not benefit from the price discovery and innovation that typically arises from a competitive bidding process. This can potentially lead to higher costs for the taxpayer.
Taxpayer Impact: Sole-source awards limit the government's ability to secure the best possible price through competitive negotiation, potentially resulting in higher expenditures for taxpayers compared to a fully competed contract.
Public Impact
The primary beneficiaries are the Department of the Army and its intelligence operations, which rely on the Saturn Arch ISR systems for critical data. The contract ensures the continued operational readiness and sustainment of vital intelligence, surveillance, and reconnaissance capabilities. Geographic impact is likely focused on operational theaters where these ISR systems are deployed, supporting military missions. Workforce implications include specialized technical personnel required for the maintenance and support of advanced ISR systems.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competitive pressure on pricing.
- Lack of transparency in the justification for sole-source award.
- Potential for cost overruns if not closely managed due to limited competition.
Positive Signals
- Contractor (Leidos, Inc.) has extensive experience in defense systems sustainment.
- Firm Fixed Price contract type provides cost certainty.
- Award ensures continuity of critical ISR capabilities for the Army.
Sector Analysis
The contract falls within the broader aerospace and defense sector, specifically focusing on the sustainment of intelligence, surveillance, and reconnaissance (ISR) systems. This sector is characterized by high technological complexity, significant government investment, and often long-term support requirements. The market for ISR system sustainment is typically dominated by a few large defense contractors with specialized expertise. Comparable spending benchmarks would involve analyzing other sustainment contracts for similar advanced airborne platforms or intelligence-gathering equipment, which often represent substantial investments due to the sophisticated nature of the technology.
Small Business Impact
This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' (small business subcontracting) field is also false. This suggests that small businesses are unlikely to be directly involved as prime contractors or through mandated subcontracting opportunities on this specific award. The focus is on a large prime contractor, Leidos, Inc., which may or may not utilize small businesses in its supply chain for this particular contract, but there is no explicit requirement or set-aside driving such engagement.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. As a definitive contract, it is subject to standard federal procurement regulations and oversight mechanisms. Transparency regarding the specific sustainment activities and performance metrics would depend on reporting requirements outlined in the contract. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract's execution.
Related Government Programs
- Intelligence, Surveillance, and Reconnaissance (ISR) Systems
- Airborne Platform Support
- Defense Contractor Services
- Department of the Army Procurement
Risk Flags
- Sole-source award may limit price competition.
- Lack of transparency in competition justification.
- Potential for cost escalation without competitive pressure.
Tags
defense, department-of-defense, department-of-the-army, intelligence-surveillance-reconnaissance, isr-systems, sustainment, firm-fixed-price, definitive-contract, sole-source, leidos-inc, virginia, air-transportation-support
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $39.2 million to LEIDOS, INC.. CONTINUED OPERATIONS AND SUSTAINMENT OF SATURN ARCH ISR SYSTEMS. IGF::CL,CT::IGF
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 $39.2 million.
What is the period of performance?
Start: 2015-09-17. End: 2017-03-31.
What is the track record of Leidos, Inc. in sustaining similar ISR systems for the Department of Defense?
Leidos, Inc. has a substantial track record in providing sustainment, integration, and support services for a wide array of defense systems, including intelligence, surveillance, and reconnaissance (ISR) platforms. Their expertise spans various aspects of aerospace and defense, encompassing aircraft modification, sensor integration, and lifecycle support. The company frequently engages in large-scale contracts with the Department of Defense and other federal agencies, demonstrating a capacity to manage complex technical requirements and long-term support obligations. Specific to ISR systems, Leidos has been involved in programs related to airborne platforms, ground systems, and data processing, indicating a strong foundation for undertaking the sustainment of the Saturn Arch ISR systems. Their history suggests they are well-positioned to meet the technical demands of such a contract, though the specific performance on past ISR sustainment contracts would require deeper analysis of contract performance reports and award histories.
How does the $39.2 million contract value compare to similar ISR system sustainment contracts?
Benchmarking the $39.2 million contract value for the Saturn Arch ISR Systems sustainment against similar contracts is challenging without specific details on the scope and duration of comparable efforts. However, sustainment of complex ISR platforms, especially those involving advanced sensor technology and data processing, can be substantial. Contracts for maintaining airborne ISR capabilities, including aircraft, sensors, and ground support, often range from tens to hundreds of millions of dollars over several years, depending on the system's complexity, age, and operational tempo. Given this contract's duration of approximately 1.5 years and its sole-source nature, the $39.2 million figure suggests a significant but not exceptionally large investment for specialized sustainment. A more precise comparison would require identifying contracts for similar ISR systems (e.g., other airborne surveillance platforms, specific sensor suites) awarded to other large defense contractors, factoring in contract length, service scope, and economic conditions at the time of award.
What are the primary risks associated with this sole-source contract for ISR system sustainment?
The primary risk associated with this sole-source contract is the potential for suboptimal pricing due to the lack of competitive bidding. Without competing offers, the government may not achieve the most cost-effective solution, potentially leading to higher expenditures than if the contract were competed. Another risk is contractor performance; while Leidos, Inc. is an established firm, the absence of competitive pressure could theoretically reduce incentives for exceptional performance or innovation. Furthermore, sole-source awards can sometimes indicate a lack of readily available alternatives or a dependency on a single provider, which poses a strategic risk if that provider faces financial difficulties or operational challenges. Ensuring robust oversight and clear performance metrics is crucial to mitigate these risks and ensure value for taxpayer money.
How effective is the firm fixed-price contract type in managing costs for ISR system sustainment?
The firm fixed-price (FFP) contract type is generally considered effective in managing costs for ISR system sustainment, particularly when the scope of work is well-defined and risks are understood. Under an FFP contract, the contractor assumes most of the risk for cost overruns, agreeing to a set price regardless of their actual costs. This provides the government with cost certainty and predictability, making budgeting easier. For sustainment activities where the requirements are relatively stable, such as routine maintenance, repair, and logistical support, FFP can incentivize efficiency. However, if unforeseen technical issues or significant changes in operational requirements arise, the contractor might seek contract modifications, potentially increasing costs. The effectiveness also hinges on the initial price negotiation and the government's ability to monitor contractor performance against the defined scope.
What is the historical spending trend for sustainment of Saturn Arch ISR Systems or similar platforms?
Historical spending data specifically for the 'Saturn Arch ISR Systems' is not readily available in the provided data snippet, nor is it a commonly published program name that allows for easy historical trend analysis without further context. However, for complex ISR platforms within the Department of Defense, sustainment costs typically represent a significant portion of the total lifecycle cost, often exceeding the initial acquisition cost over the system's operational life. Spending on ISR system sustainment is generally characterized by long-term, multi-year contracts. Trends are influenced by factors such as system upgrades, operational tempo, aging components, and evolving threat environments. Annual spending can fluctuate based on specific maintenance cycles, depot-level repairs, and modernization efforts. Without specific historical contract data for this system, it's difficult to establish a precise trend, but it's reasonable to assume consistent, substantial investment is required for such critical capabilities.
Industry Classification
NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation
Product/Service Code: SPECIAL STUDIES/ANALYSIS, NOT R&D › SPECIAL STUDIES - NOT R and D
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.
Address: 11951 FREEDOM DR, 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: $39,195,404
Exercised Options: $39,195,404
Current Obligation: $39,195,404
Subaward Activity
Number of Subawards: 16
Total Subaward Amount: $29,627,835
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2015-09-17
Current End Date: 2017-03-31
Potential End Date: 2017-03-31 12:03:00
Last Modified: 2022-03-11
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