DoD's $21.2M contract for launch, ranges, and networks services awarded to SIGMACOR, LLC

Contract Overview

Contract Amount: $21,204,505 ($21.2M)

Contractor: Sigmacor, LLC

Awarding Agency: Department of Defense

Start Date: 2010-10-14

End Date: 2016-04-13

Contract Duration: 2,008 days

Daily Burn Rate: $10.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: SERVICE FOR A3-0235, REQUIRED SERVICES AND SUPPORT FOR LAUNCH, RANGES AND NETWORKS DIVISION (A3R) AIR FORCE SPACE COMMAND (AFSPC)

Place of Performance

Location: COLORADO SPRINGS, EL PASO County, COLORADO, 80914

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $21.2 million to SIGMACOR, LLC for work described as: SERVICE FOR A3-0235, REQUIRED SERVICES AND SUPPORT FOR LAUNCH, RANGES AND NETWORKS DIVISION (A3R) AIR FORCE SPACE COMMAND (AFSPC) Key points: 1. Contract awarded for critical launch, ranges, and networks support to the Air Force Space Command. 2. SIGMACOR, LLC, a contractor with a history in defense services, secured this award. 3. The contract spans over five years, indicating a long-term need for these specialized services. 4. The award was made under a full and open competition after exclusion of sources, suggesting a specific justification for the procurement method. 5. The North American Industry Classification System (NAICS) code 541712 points to research and development in physical, engineering, and life sciences. 6. The contract type is Cost Plus Fixed Fee (CPFF), which can present cost control challenges if not managed diligently. 7. The total value of $21.2 million over the period suggests a significant investment in space command infrastructure and operations.

Value Assessment

Rating: fair

The contract's value of $21.2 million over approximately five years for specialized R&D services appears within a reasonable range for defense sector support. However, without specific benchmarks for 'launch, ranges, and networks division' services, a precise value-for-money assessment is challenging. The CPFF contract type introduces inherent risk in cost management, as contractor profit is fixed regardless of actual costs incurred, potentially leading to less incentive for cost efficiency compared to fixed-price contracts. Further analysis of the contractor's performance on similar contracts and the detailed cost breakdown would be necessary for a more definitive valuation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This procurement method implies that while the competition was intended to be open, certain sources were excluded, likely due to specific technical requirements, security clearances, or prior performance issues. The presence of three bidders indicates some level of competition, but the exclusion of other potential sources may have limited the breadth of competition and potentially impacted price discovery.

Taxpayer Impact: The exclusion of sources, even with three bidders, could mean taxpayers did not benefit from the lowest possible price that a truly open and unrestricted competition might have yielded. This method requires careful justification to ensure it serves the government's best interest.

Public Impact

The primary beneficiaries are the Department of the Air Force and the Air Force Space Command, which receive essential support for their launch, ranges, and network operations. The services delivered are crucial for maintaining and enhancing the capabilities of U.S. space assets and launch infrastructure. The geographic impact is likely concentrated around Air Force facilities involved in space operations, potentially including launch sites and command centers. The contract supports specialized technical and research roles, implying a workforce skilled in engineering, physics, and related scientific fields.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type can lead to less cost control compared to fixed-price arrangements.
The 'exclusion of sources' in the competition method warrants scrutiny to ensure it was fully justified and did not unduly restrict competition.
Limited public information on the specific services and performance metrics makes it difficult to assess the overall effectiveness and value.
The contractor's track record on similar complex R&D projects would be a key factor in assessing performance risk.

Positive Signals

Award to SIGMACOR, LLC, suggests a contractor meeting specific technical and performance requirements.
The contract duration of over five years indicates a stable, long-term need for these critical services.
The existence of three bidders, even with exclusions, shows some level of market interest and capability.
The contract supports vital national security functions related to space command and operations.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences, excluding biotechnology. The aerospace and defense industry is a significant market for R&D services, with substantial government investment. Comparable spending benchmarks would typically involve other contracts for launch support, range operations, and network infrastructure for military and civilian space programs. The total value of $21.2 million is moderate for a multi-year R&D effort in this specialized field.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a result, small businesses are unlikely to be direct recipients of this prime contract. However, there may be subcontracting opportunities for small businesses if SIGMACOR, LLC chooses to engage them for specialized support, though this is not explicitly detailed in the provided information. The overall impact on the small business ecosystem would depend on the extent of any subcontracting efforts.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Air Force and the Air Force Space Command. Mechanisms likely include contract performance reviews, financial audits, and adherence to the terms of the Cost Plus Fixed Fee agreement. Transparency is often limited for defense contracts of this nature, with detailed performance data and cost breakdowns typically not publicly disclosed. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract.

Related Government Programs

Air Force Space Command Operations Support
Launch Range Services
Aerospace Research and Development
Defense Network Infrastructure
Space Systems Engineering

Risk Flags

Cost Control Risk (CPFF)
Limited Competition Justification
Performance Monitoring Over Extended Duration
R&D Cost Predictability

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.2 million to SIGMACOR, LLC. SERVICE FOR A3-0235, REQUIRED SERVICES AND SUPPORT FOR LAUNCH, RANGES AND NETWORKS DIVISION (A3R) AIR FORCE SPACE COMMAND (AFSPC)

Who is the contractor on this award?

The obligated recipient is SIGMACOR, 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 $21.2 million.

What is the period of performance?

Start: 2010-10-14. End: 2016-04-13.

What is SIGMACOR, LLC's track record with similar government contracts, particularly in R&D for space command?

SIGMACOR, LLC has a history of performing services for the U.S. government, including within the defense sector. While specific details on their track record for 'launch, ranges, and networks division' R&D are not fully elaborated in the provided data, their past performance on similar contracts would have been a key factor in the award decision. A deeper dive into their contract history, including past performance evaluations and any reported issues or successes on comparable projects, would provide a clearer picture of their capabilities and reliability in this specialized domain. This information is crucial for assessing the risk associated with this particular contract.

How does the $21.2 million contract value compare to similar R&D services for space command infrastructure?

Benchmarking the $21.2 million contract value requires comparison with similar contracts for specialized R&D in launch, ranges, and networks for space command. Without access to a comprehensive database of comparable contracts, a precise comparison is difficult. However, for a multi-year effort (over five years) involving complex R&D, this value appears moderate within the defense sector. Factors influencing this value include the scope of work, the level of technical expertise required, the duration, and the specific technologies involved. A more detailed analysis would involve identifying contracts with similar NAICS codes, agencies, and service descriptions to establish a more robust benchmark for value for money.

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

The primary risk with a Cost Plus Fixed Fee (CPFF) contract, like the one awarded to SIGMACOR, LLC, is potential cost overruns and reduced incentive for contractor efficiency. In a CPFF structure, the contractor is reimbursed for allowable costs plus a fixed fee representing their profit. While the fee is fixed, the contractor has less incentive to control costs compared to fixed-price contracts, as their profit margin remains constant regardless of the actual expenses incurred. This can lead to higher overall costs for the government if not managed with rigorous oversight and cost controls. For R&D projects, where costs can be inherently unpredictable, CPFF contracts are sometimes necessary but require diligent monitoring of expenditures and performance.

What does 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' imply for the procurement process and potential savings?

The procurement method 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' suggests that the agency initially intended a broad competition but subsequently excluded certain potential offerors. This exclusion is typically based on specific, documented reasons such as unique technical capabilities, security requirements, or past performance issues. While it allows for competition among the remaining sources (three bidders in this case), it inherently limits the pool of potential offerors. This limitation could potentially result in higher prices for taxpayers compared to a truly unrestricted full and open competition, as the market may not have been fully leveraged. The justification for excluding sources is critical for ensuring the government obtained the best value.

How does the contract's duration (over five years) impact its overall value and risk assessment?

The contract's duration of over five years (from October 2010 to April 2016, approximately 5.5 years) indicates a sustained and critical need for the services provided by SIGMACOR, LLC. A longer duration can offer benefits such as greater stability for the contractor, potentially leading to more consistent service delivery and reduced transition costs. However, it also extends the period during which cost risks associated with the CPFF structure are present. For the government, a longer contract can lock in pricing and services, but it also means less flexibility to adapt to changing technological landscapes or market conditions. Risk assessment is influenced by the contractor's ability to maintain performance and manage costs effectively over this extended period.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: FA251708R9000

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 5050 EDISON AVE STE 217, COLORADO SPRINGS, CO, 80915

Business Categories: Category Business, Limited Liability Corporation, Minority Owned Business, Small Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $22,578,897

Exercised Options: $22,578,897

Current Obligation: $21,204,505

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA251710D9003

IDV Type: IDC

Timeline