DoD Awards $123M for SATURN ARCH System Operations and Sustainment to Leidos, Inc
Contract Overview
Contract Amount: $123,346,263 ($123.3M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2020-09-17
End Date: 2023-09-16
Contract Duration: 1,094 days
Daily Burn Rate: $112.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: CONTINUED SYSTEM OPERATIONS AND SUSTAINMENT SERVICES, AND TEST AND TRAINING SERVICES IN SUPPORT OF THE MULTI-SENSOR IMAGING SYSTEM KNOWN AS THE SATURN ARCH. FOLLOW-ON AWARD TO W911QX-16-C-0012.
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $123.3 million to LEIDOS, INC. for work described as: CONTINUED SYSTEM OPERATIONS AND SUSTAINMENT SERVICES, AND TEST AND TRAINING SERVICES IN SUPPORT OF THE MULTI-SENSOR IMAGING SYSTEM KNOWN AS THE SATURN ARCH. FOLLOW-ON AWARD TO W911QX-16-C-0012. Key points: 1. Leidos, Inc. secured a significant follow-on contract for critical SATURN ARCH system support. 2. The contract value of $123.3 million over three years highlights the importance of ongoing system operations. 3. Lack of competition raises concerns about potential overpricing and limited market engagement. 4. This spending falls under 'Other Support Activities for Air Transportation', a niche but vital sector.
Value Assessment
Rating: questionable
The contract's cost-plus-fixed-fee structure, combined with a lack of competition, makes a direct pricing assessment difficult. Benchmarking against similar sustainment contracts for complex sensor systems is recommended to ensure fair pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there is no market pressure to offer competitive pricing.
Taxpayer Impact: The absence of competition for a contract of this magnitude may result in taxpayers paying a premium for services that could potentially be procured at a lower cost.
Public Impact
Ensures continued operation and testing of the critical Multi-Sensor Imaging System (SATURN ARCH). Supports Department of Defense readiness and intelligence gathering capabilities. Potential for increased costs due to sole-source award impacts taxpayer value.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of Competition
- Cost-Plus-Fixed-Fee Structure
- Sole-Source Award
Positive Signals
- Follow-on Award
- Critical System Support
- Experienced Contractor
Sector Analysis
This contract supports 'Other Support Activities for Air Transportation', a sector often involving specialized technology and services. Spending benchmarks for similar complex system sustainment contracts are difficult to establish without competitive data.
Small Business Impact
The contract was awarded to Leidos, Inc. and there is no indication of small business participation. Further analysis is needed to determine if subcontracting opportunities were explored or offered to small businesses.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the contractor is delivering services efficiently and at a fair price. Regular performance reviews and cost audits are crucial for accountability.
Related Government Programs
- Other Support Activities for Air Transportation
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award limits competition and price discovery.
- Cost-plus-fixed-fee structure shifts cost overrun risk to the government.
- Lack of transparency on justification for sole-source award.
- No indication of small business participation.
- Potential for inflated costs due to lack of competitive pressure.
Tags
other-support-activities-for-air-transpo, department-of-defense, va, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $123.3 million to LEIDOS, INC.. CONTINUED SYSTEM OPERATIONS AND SUSTAINMENT SERVICES, AND TEST AND TRAINING SERVICES IN SUPPORT OF THE MULTI-SENSOR IMAGING SYSTEM KNOWN AS THE SATURN ARCH. FOLLOW-ON AWARD TO W911QX-16-C-0012.
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 $123.3 million.
What is the period of performance?
Start: 2020-09-17. End: 2023-09-16.
What is the justification for the sole-source award, and what steps were taken to ensure fair and reasonable pricing without competition?
The justification for a sole-source award typically involves unique capabilities or proprietary technology. However, for sustainment services, agencies should explore competitive options or at least conduct thorough market research to validate the necessity of a sole-source approach. Without this information, it's difficult to assess if fair and reasonable pricing was achieved, as competitive pressures are absent.
How does the cost-plus-fixed-fee structure impact the government's ability to control costs for SATURN ARCH sustainment?
A cost-plus-fixed-fee (CPFF) contract allows the contractor to recover all allowable costs plus a fixed fee representing profit. While the fixed fee provides some cost certainty, the government bears the risk of cost overruns. This structure can incentivize contractors to incur costs, making robust oversight and detailed cost analysis essential to prevent unnecessary expenditures and ensure value for taxpayer money.
What is the long-term strategy for ensuring competitive sourcing for SATURN ARCH sustainment to mitigate future sole-source awards?
The long-term strategy should involve proactive market research and planning to identify potential competitors or develop requirements that can be met by multiple sources. If the system's technology is proprietary, exploring alternative solutions or developing in-house capabilities could be considered. Breaking down the requirement into smaller, more competitive lots might also be an option.
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
Solicitation ID: W58RGZ19R0079
Offers Received: 1
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: $123,346,263
Exercised Options: $123,346,263
Current Obligation: $123,346,263
Subaward Activity
Number of Subawards: 67
Total Subaward Amount: $80,182,582
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2020-09-17
Current End Date: 2023-09-16
Potential End Date: 2023-09-16 00:00:00
Last Modified: 2025-09-25
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