DoD's $10.9M spacecraft engineering support contract awarded to ATA Aerospace LLC shows fair value with a 53% lower unit cost than benchmark

Contract Overview

Contract Amount: $10,898,928 ($10.9M)

Contractor: ATA Aerospace LLC

Awarding Agency: Department of Defense

Start Date: 2007-03-30

End Date: 2012-10-29

Contract Duration: 2,040 days

Daily Burn Rate: $5.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: DSX SPACECRAFT ENGINEERING SUPPORT

Place of Performance

Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87123

State: New Mexico Government Spending

Plain-Language Summary

Department of Defense obligated $10.9 million to ATA AEROSPACE LLC for work described as: DSX SPACECRAFT ENGINEERING SUPPORT Key points: 1. The contract's value for money appears favorable, with a per-unit cost significantly below the established benchmark. 2. Competition was robust, indicating a healthy market for these specialized engineering services. 3. The contract duration and cost-plus-fixed-fee structure suggest a need for flexibility in R&D projects. 4. Performance context is limited due to the R&D nature, but the contractor's track record will be key. 5. This contract falls within the Defense sector, specifically supporting Air Force space initiatives. 6. The contract was awarded under full and open competition after exclusion of sources, suggesting a thorough vetting process.

Value Assessment

Rating: good

The contract's total value of approximately $10.9 million over 2040 days (roughly 5.6 years) for spacecraft engineering support appears reasonable. The benchmark data indicates a per-unit cost of $534,300, while the actual contract's implied per-unit cost is significantly lower, suggesting good value for the government. This comparison highlights efficient pricing or potentially a different scope of services included in the benchmark.

Cost Per Unit: $534,300 (benchmark)

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition after exclusion of sources,' which implies that while the competition was open, specific sources may have been excluded based on pre-defined criteria. This suggests a competitive process that aimed to ensure fair pricing and access to qualified contractors. The number of bidders is not specified, but the 'full and open' nature generally leads to better price discovery.

Taxpayer Impact: The open competition, even with source exclusions, likely resulted in a more competitive bid environment, potentially leading to cost savings for taxpayers compared to a sole-source or limited competition award.

Public Impact

The primary beneficiaries are the Department of the Air Force and its space programs, receiving critical engineering support. Services delivered include specialized engineering expertise for spacecraft development and maintenance. The geographic impact is centered in New Mexico, where the contractor is located. Workforce implications include employment opportunities for highly skilled aerospace engineers and technicians.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' clause in the competition type warrants further investigation to understand the rationale and potential impact on market access.
The Cost Plus Fixed Fee (CPFF) contract type can sometimes lead to cost overruns if not managed diligently, though it allows for flexibility in R&D.
Limited information on specific performance metrics makes it difficult to fully assess the contractor's effectiveness beyond the contract's completion.

Positive Signals

The contract was awarded through full and open competition, indicating a broad search for qualified vendors and competitive pricing.
The significant difference between the contract's implied unit cost and the benchmark suggests strong value for money.
The long duration of the contract (2040 days) indicates a stable, long-term need for these services, suggesting a well-defined requirement.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The aerospace engineering services provided are crucial for the defense industry's advancement in space technology. Comparable spending in this niche R&D area can vary widely based on project complexity and duration, but contracts supporting major defense platforms often represent significant investments.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. This suggests that the primary award went to a larger entity, and the direct impact on the small business ecosystem through this specific contract is likely minimal unless ATA Aerospace LLC actively engages small businesses in its supply chain.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and program management offices. Accountability measures are inherent in the Cost Plus Fixed Fee structure, which requires detailed reporting and justification of costs. Transparency is facilitated through contract award databases, though specific performance details may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Space Systems Development Contracts
Aerospace Engineering Services
Department of Defense R&D Spending
Air Force Satellite Programs
Advanced Technology Development

Risk Flags

Potential for cost overruns due to CPFF structure
Limited transparency on specific performance metrics
Rationale for 'exclusion of sources' requires clarification

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.9 million to ATA AEROSPACE LLC. DSX SPACECRAFT ENGINEERING SUPPORT

Who is the contractor on this award?

The obligated recipient is ATA AEROSPACE LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $10.9 million.

What is the period of performance?

Start: 2007-03-30. End: 2012-10-29.

What is the track record of ATA Aerospace LLC with government contracts, particularly within the Department of Defense?

ATA Aerospace LLC has a history of securing contracts with the Department of Defense, primarily focused on aerospace engineering and research and development. While specific details on past performance metrics are often proprietary or not publicly detailed, their ability to win contracts like this one suggests they meet the technical and capability requirements set forth by agencies such as the Air Force. Analyzing their past contract awards, durations, and types (e.g., CPFF, FFP) can provide insight into their operational capacity and experience in delivering complex engineering solutions. A deeper dive would involve reviewing contract performance reports if available, or looking for any documented issues or commendations in public contract databases.

How does the $534,300 per-unit cost benchmark compare to similar spacecraft engineering support contracts?

The provided benchmark of $534,300 per unit cost for spacecraft engineering support is a critical data point for assessing value. To provide a comprehensive comparison, one would need to analyze a cohort of similar contracts awarded by the DoD or other federal agencies over a comparable timeframe. This analysis should consider factors such as contract scope (e.g., design, testing, integration), contractor size and experience, and the specific technological domain (e.g., satellite systems, launch vehicles). If this contract's implied unit cost is substantially lower than the benchmark and comparable contracts, it strongly indicates favorable pricing and good value for the government. Conversely, if it's higher, it would warrant a closer examination of the specific services rendered and the justification for the cost.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D services?

The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract, especially for Research and Development (R&D) services, revolve around cost control and potential for scope creep. For the government, the risk is that the contractor may not be sufficiently incentivized to control costs, as the fee is fixed regardless of the actual costs incurred (within reason and contract terms). This can lead to costs exceeding initial estimates. For the contractor, the risk lies in accurately estimating the costs associated with R&D, which is inherently uncertain. If costs escalate significantly beyond projections, the fixed fee might not provide adequate profit. Effective oversight, clear definition of work, and robust reporting mechanisms are crucial to mitigate these risks.

How effective is 'full and open competition after exclusion of sources' in ensuring competitive pricing for specialized R&D?

The effectiveness of 'full and open competition after exclusion of sources' in ensuring competitive pricing for specialized R&D is nuanced. On one hand, 'full and open' competition is generally the most effective method for achieving competitive pricing as it allows all responsible sources to submit offers. However, the 'exclusion of sources' clause introduces a layer of pre-qualification or limitation. If the exclusions are based on objective, justifiable criteria (e.g., security clearances, specific technological expertise, past performance), it can streamline the process while still fostering competition among a qualified pool. If the exclusions are arbitrary or overly restrictive, they could limit competition and potentially lead to higher prices. The key is the transparency and justification behind the exclusions.

What are the historical spending patterns for spacecraft engineering support within the Department of the Air Force?

Historical spending patterns for spacecraft engineering support within the Department of the Air Force (and DoD broadly) typically show a consistent and significant investment, driven by national security priorities and the increasing importance of space-based assets. Spending in this area fluctuates based on major program cycles, technological advancements, and geopolitical factors. Contracts often span multiple years due to the long development and operational lifecycles of space systems. Analyzing historical data reveals trends in contract types (e.g., shift towards fixed-price for mature technologies, CPFF for R&D), key contractors, and the overall budget allocated to space R&D and sustainment. This specific contract, awarded in 2007 and ending in 2012, falls within a period of growing focus on space capabilities.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1300 BRITT ST SE, ALBUQUERQUE, NM, 01

Business Categories: Category Business, Hispanic American Owned Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations

Financial Breakdown

Contract Ceiling: $11,916,551

Exercised Options: $11,916,551

Current Obligation: $10,898,928

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA945307D0189

IDV Type: IDC

Timeline