DoD's $24.6M Boeing Contract: Cost Plus Incentive Fee for Naval Aviation Support
Contract Overview
Contract Amount: $24,647,736 ($24.6M)
Contractor: Boeing Company, the
Awarding Agency: Department of Defense
Start Date: 2005-09-23
End Date: 2009-01-31
Contract Duration: 1,226 days
Daily Burn Rate: $20.1K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 8
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Place of Performance
Location: IRVINE, ORANGE County, CALIFORNIA, 92618
Plain-Language Summary
Department of Defense obligated $24.6 million to BOEING COMPANY, THE for work described as: Key points: 1. Significant contract value of $24.6 million awarded to a major defense contractor. 2. Competition was full and open after exclusion of sources, suggesting a deliberate process. 3. Risk is moderate given the Cost Plus Incentive Fee structure, which can lead to cost overruns. 4. The sector is Defense, specifically naval aviation support, a critical area for the DoD.
Value Assessment
Rating: fair
The Cost Plus Incentive Fee (CPIF) structure allows for shared savings and cost overruns between the government and contractor. While it incentivizes efficiency, it carries inherent risk of higher-than-expected costs if not managed closely.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This implies a competitive process was initiated, but specific sources were excluded, potentially impacting the breadth of price discovery.
Taxpayer Impact: The CPIF structure means taxpayer impact is variable and depends on contractor performance and cost management. The competitive nature aims to mitigate excessive pricing, but oversight is crucial.
Public Impact
Naval aviation readiness and support services are directly impacted by this contract. Boeing's role as a major defense contractor highlights its importance in the defense industrial base. The duration of the contract (over 3 years) suggests a long-term need for these services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Incentive Fee structure can lead to cost overruns.
- Exclusion of sources in competition may limit price discovery.
- Long contract duration increases exposure to potential performance issues.
Positive Signals
- Awarded under full and open competition, indicating a structured procurement.
- Incentive fee structure aims to align contractor and government interests.
- Awarded to a reputable, large defense contractor.
Sector Analysis
This contract falls within the Defense sector, specifically supporting naval aviation. Spending in this area is critical for national security and often involves complex, high-value procurements with specialized contractors like Boeing.
Small Business Impact
The data does not indicate any specific involvement or benefit for small businesses in this contract. The award to a large prime contractor like Boeing suggests subcontracting opportunities may exist, but direct small business participation is not evident.
Oversight & Accountability
The contract's duration and CPIF structure necessitate robust oversight from the Department of the Navy to ensure cost control and performance standards are met. Tracking expenditures and performance against incentives is key.
Related Government Programs
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Potential for cost overruns due to CPIF structure.
- Limited transparency on reasons for source exclusion.
- Long-term contract duration increases risk exposure.
- Lack of direct small business participation noted.
Tags
department-of-defense, ca, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $24.6 million to BOEING COMPANY, THE. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is BOEING COMPANY, THE.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $24.6 million.
What is the period of performance?
Start: 2005-09-23. End: 2009-01-31.
What specific naval aviation support services were procured under this contract, and how do they align with current operational needs?
The contract details do not specify the exact nature of the naval aviation support services. However, given the duration and value, it likely encompasses maintenance, repair, logistics, or technical support for naval aircraft. Alignment with current operational needs would require further analysis of DoD aviation readiness goals and specific fleet requirements.
What were the primary reasons for excluding certain sources during the 'full and open competition' process?
The exclusion of sources in a 'full and open competition' scenario typically occurs due to specific technical requirements, existing system integration needs, or unique capabilities possessed by the selected contractor that cannot be easily replicated. Justification for such exclusions is usually documented in the contract file to ensure fairness and adherence to procurement regulations.
How effectively did the incentive fee structure manage costs and drive performance compared to alternative contract types for similar services?
Without access to the contract's performance data and final cost, it's impossible to definitively assess the effectiveness of the incentive fee structure. CPIF contracts aim to balance cost control with performance by sharing savings or overruns. A thorough review would compare the final cost and achieved performance metrics against the initial targets and benchmarks.
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: BASIC RESEARCH
Offers Received: 8
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: THE Boeing Company (UEI: 009256819)
Address: 5000 E MCDOWELL ROAD, MESA, AZ, 85215
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: N0042105D0046
IDV Type: IDC
Timeline
Start Date: 2005-09-23
Current End Date: 2009-01-31
Potential End Date: 2009-01-31 00:00:00
Last Modified: 2018-10-17
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