DoD's $33M LKMD System contract awarded to Amentum Services, Inc. for communications equipment

Contract Overview

Contract Amount: $33,025,697 ($33.0M)

Contractor: Amentum Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2012-04-23

End Date: 2014-09-26

Contract Duration: 886 days

Daily Burn Rate: $37.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: LKMD SYSTEM

Place of Performance

Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87107

State: New Mexico Government Spending

Plain-Language Summary

Department of Defense obligated $33.0 million to AMENTUM SERVICES, INC. for work described as: LKMD SYSTEM Key points: 1. Contract value of $33M over approximately 2.5 years suggests a significant investment in specialized equipment. 2. Awarded under full and open competition, indicating a broad market search for the best value. 3. The firm-fixed-price contract type shifts performance risk to the contractor. 4. The contract's duration and value warrant scrutiny for potential cost efficiencies and long-term sustainment. 5. Focus on 'Other Communications Equipment Manufacturing' places this within a critical but often opaque sector of defense procurement. 6. The absence of small business set-aside suggests the primary contractor is likely a large entity, with subcontracting opportunities needing further investigation.

Value Assessment

Rating: fair

The contract value of $33 million over 886 days (approximately 2.5 years) averages to about $37,275 per day. Without specific details on the 'LKMD System' and its components, a direct value-for-money assessment is challenging. However, the award amount appears substantial for communications equipment, suggesting either high-value components or extensive integration services. Benchmarking against similar, publicly available contracts for specialized communication systems would be necessary for a more precise valuation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' meaning all responsible sources were permitted to submit a bid. With 3 bidders, this indicates a moderate level of competition for this specific requirement. While more than a sole-source award, the limited number of bidders might suggest a niche market or specialized capabilities required, potentially impacting the price discovery process.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages multiple vendors to offer competitive pricing, potentially leading to cost savings. However, with only three bidders, the savings might be less pronounced than in markets with broader participation.

Public Impact

The primary beneficiaries are likely Department of Defense units requiring the specific capabilities of the LKMD System. The contract delivers 'Other Communications Equipment Manufacturing,' crucial for maintaining and enhancing military communication networks. The contract was awarded to Amentum Services, Inc., a large defense contractor, implying potential impacts on the broader defense industrial base. The geographic impact is centered in New Mexico, where the contractor is located, potentially supporting local jobs and economic activity in that region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed performance metrics makes it difficult to assess the effectiveness and efficiency of the delivered equipment.
The 'Other Communications Equipment Manufacturing' category is broad, raising questions about the specific technology and its obsolescence risk.
Limited competition (3 bidders) could indicate potential barriers to entry for smaller, innovative firms, possibly limiting cost-saving opportunities.

Positive Signals

Awarded under full and open competition, suggesting a structured procurement process aimed at achieving best value.
The firm-fixed-price contract type transfers cost overrun risk to the contractor, providing budget certainty for the government.
The contract duration of nearly three years allows for sustained support and integration of the equipment.

Sector Analysis

The 'Other Communications Equipment Manufacturing' sector is a vital component of the defense industrial base, encompassing a wide range of technologies from tactical radios to complex network infrastructure. This contract, valued at $33 million, represents a significant, albeit specific, investment within this sector. Comparable spending benchmarks are difficult to establish without knowing the precise nature of the LKMD System, but it falls within the typical range for specialized defense electronics procurement.

Small Business Impact

The contract data indicates no specific small business set-aside (ss: false, sb: false). This suggests the primary contract was not carved out for small businesses. Amentum Services, Inc., as a large prime contractor, may have subcontracting opportunities for small businesses, but these are not explicitly detailed in the provided data. The impact on the small business ecosystem would depend on the extent to which Amentum utilizes small business subcontractors for specialized components or services.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. As a firm-fixed-price contract, oversight would focus on ensuring delivery of specified equipment and adherence to contract terms. Transparency is moderate, with the award details publicly available, but specific performance metrics and detailed cost breakdowns are often not disclosed. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Tactical Communications Systems
Command and Control Systems
Electronic Warfare Equipment
Defense Communications Infrastructure

Risk Flags

Lack of specific system details
Limited competition indicators
Potential for technology obsolescence

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.0 million to AMENTUM SERVICES, INC.. LKMD SYSTEM

Who is the contractor on this award?

The obligated recipient is AMENTUM SERVICES, 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 $33.0 million.

What is the period of performance?

Start: 2012-04-23. End: 2014-09-26.

What is the specific function and technological nature of the 'LKMD System'?

The provided data identifies the contract as being for 'LKMD SYSTEM' under the 'Other Communications Equipment Manufacturing' North American Industry Classification System (NAICS) code. However, the specific function, technological capabilities, and intended use of the 'LKMD System' are not detailed. This lack of specificity makes it challenging to assess its criticality, potential obsolescence, or compare its value effectively. Further investigation into contract line item numbers (CLINs) or associated technical documentation would be required to understand the system's purpose, whether it's for tactical communication, strategic networks, data transmission, or another specialized military application.

How does the $33 million contract value compare to similar procurements for specialized communications equipment within the DoD?

Benchmarking the $33 million contract value requires identifying comparable procurements for specialized communications equipment. Without knowing the exact nature of the 'LKMD System,' direct comparisons are difficult. However, contracts for advanced communication suites, electronic warfare systems, or secure network infrastructure can range from tens to hundreds of millions of dollars. The value of this contract, spread over approximately 2.5 years, suggests a substantial but not exceptionally large procurement. Factors like technological sophistication, quantity, and integration services heavily influence pricing. A more precise comparison would necessitate analyzing contracts with similar NAICS codes (e.g., 334290) and specific equipment types awarded within the last few years.

What are the key performance indicators (KPIs) and success metrics associated with this contract?

The provided data does not include specific Key Performance Indicators (KPIs) or success metrics for the 'LKMD System' contract. For a firm-fixed-price contract, the primary success metric is typically the contractor's timely delivery of the specified goods or services in accordance with the contract's technical requirements and specifications. Additional metrics might include reliability, maintainability, and operational readiness, but these are usually detailed in the contract's Statement of Work (SOW) or Performance Work Statement (PWS), which are not available here. Assessing the true value and effectiveness of the contract hinges on understanding these performance expectations and how they were measured and met.

What is Amentum Services, Inc.'s track record with similar DoD communications equipment contracts?

Amentum Services, Inc. has a significant history of performing contracts for the Department of Defense, often involving complex logistics, technical services, and equipment. While specific details on their past performance with 'Other Communications Equipment Manufacturing' like the 'LKMD System' are not provided in this data snippet, their broader portfolio likely includes work on communication systems, electronic components, and related support services. Analyzing their past performance on similar contracts, including any past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), would provide insight into their reliability, quality of work, and ability to manage complex procurements within budget and schedule.

What is the potential for cost growth or overruns given the firm-fixed-price contract type?

The firm-fixed-price (FFP) contract type is designed to limit cost growth and overruns for the government. Under an FFP agreement, the contractor assumes the primary risk for any cost increases incurred during performance. Therefore, the government's liability is generally fixed at the awarded price, barring any contract modifications or equitable adjustments due to government-directed changes or unforeseen circumstances. While FFP shifts risk to the contractor, potential issues could arise if the initial contract scope was poorly defined, leading to change orders, or if the contractor underestimated costs, potentially impacting their motivation or ability to deliver fully on the contract's requirements.

How has spending on 'Other Communications Equipment Manufacturing' by the Department of the Army trended over the past five years?

Analyzing historical spending trends for 'Other Communications Equipment Manufacturing' (NAICS 334290) by the Department of the Army requires access to comprehensive federal procurement databases. Without that specific data, a precise trend cannot be determined. However, generally, spending in this sector is influenced by evolving military technology requirements, modernization efforts, and geopolitical factors. The Army consistently invests in robust communication systems to maintain operational effectiveness. Fluctuations in spending can occur based on specific program lifecycles, the introduction of new technologies (e.g., 5G integration, cybersecurity enhancements), and budget allocations. The $33 million awarded to Amentum represents a single data point within this broader spending landscape.

Industry Classification

NAICS: Manufacturing › Communications Equipment Manufacturing › Other Communications Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W911QY11R0067

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: AECOM Global II, LLC (UEI: 043271568)

Address: 20501 SENECA MEADOWS PKWY STE 300, GERMANTOWN, MD, 06

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $33,025,697

Exercised Options: $33,025,697

Current Obligation: $33,025,697

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W911QY12D0022

IDV Type: IDC

Timeline