DoD's $32M Unmanned Aircraft Systems support contract awarded to Sigmatech Inc. shows fair value

Contract Overview

Contract Amount: $32,077,248 ($32.1M)

Contractor: Sigmatech Inc

Awarding Agency: Department of Defense

Start Date: 2006-11-27

End Date: 2012-07-13

Contract Duration: 2,055 days

Daily Burn Rate: $15.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: OVERARCHING PROGRAMMATIC SUPPORT TO THE UNMANNED AIRCRAFT SYSTEMS (UAS)

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35898

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $32.1 million to SIGMATECH INC for work described as: OVERARCHING PROGRAMMATIC SUPPORT TO THE UNMANNED AIRCRAFT SYSTEMS (UAS) Key points: 1. Contract provides essential programmatic support for Unmanned Aircraft Systems (UAS). 2. Awarded through full and open competition, indicating a competitive bidding process. 3. Contract duration of 2055 days suggests a long-term need for these services. 4. Firm Fixed Price contract type helps manage cost certainty for the government. 5. The contract's value is moderate within the context of defense engineering services. 6. Sigmatech Inc. has a track record of performance in government contracting.

Value Assessment

Rating: good

The contract value of approximately $32 million over its period of performance appears reasonable for specialized programmatic support to Unmanned Aircraft Systems. Benchmarking against similar engineering services contracts within the Department of Defense suggests that the pricing is competitive, especially given the niche expertise required for UAS support. The firm fixed price structure further enhances value by providing cost predictability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. The presence of 3 bidders suggests a healthy level of competition for this specialized service. This competitive environment is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best possible price for essential defense support services, preventing potential overpayment.

Public Impact

The Department of Defense, specifically the Department of the Army, benefits from enhanced support for its Unmanned Aircraft Systems programs. Services delivered include programmatic support, crucial for the development and sustainment of UAS capabilities. The contract's location in Alabama (AL) may imply a localized impact on the regional workforce and economy. This contract supports the advancement of critical defense technology, contributing to national security objectives.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if program requirements are not clearly defined and managed.
Reliance on a single contractor for extended periods could lead to vendor lock-in.
Ensuring continuous innovation and adaptation to rapidly evolving UAS technology.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
Firm Fixed Price contract type provides cost control and predictability.
Long contract duration indicates a stable, ongoing requirement for these critical services.
Sigmatech Inc. has experience in government contracting, implying a degree of reliability.

Sector Analysis

The Unmanned Aircraft Systems (UAS) sector is a rapidly growing segment within the broader aerospace and defense industry. This contract for programmatic support fits within the Engineering Services (NAICS 541330) category. Spending in this area is driven by the increasing military reliance on autonomous and remotely piloted aircraft for intelligence, surveillance, reconnaissance, and combat operations. Comparable spending benchmarks would typically be found within defense contracts focused on system integration, technical support, and program management for advanced military platforms.

Small Business Impact

This contract does not appear to have specific small business set-aside provisions, as indicated by 'sb': false. However, the prime contractor, Sigmatech Inc., may engage small businesses as subcontractors to fulfill certain aspects of the contract. The extent of subcontracting to small businesses would depend on Sigmatech's business practices and the specific requirements of the programmatic support. Further analysis would be needed to determine the direct impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of the Army contracting and program management offices. Accountability measures are inherent in the firm fixed price contract type, requiring delivery of specified services within agreed-upon costs. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Unmanned Aircraft Systems Programs
Army Aviation and Missile Command Support Contracts
Defense Engineering Services Contracts
Aerospace and Defense Program Management Support

Risk Flags

Long-term contract duration may pose risks related to technological relevance.
Potential for contractor performance issues over an extended period.
Need for continuous oversight to ensure adherence to firm fixed price terms.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.1 million to SIGMATECH INC. OVERARCHING PROGRAMMATIC SUPPORT TO THE UNMANNED AIRCRAFT SYSTEMS (UAS)

Who is the contractor on this award?

The obligated recipient is SIGMATECH 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 $32.1 million.

What is the period of performance?

Start: 2006-11-27. End: 2012-07-13.

What is Sigmatech Inc.'s overall track record with federal contracts, particularly within the Department of Defense?

Sigmatech Inc. has a history of performing federal contracts, primarily with the Department of Defense. While specific details on past performance metrics for this particular contract are not provided in the summary data, their engagement in multiple contracts suggests experience in navigating government procurement processes and delivering services. A deeper dive into their contract history, including past performance evaluations and any reported issues, would provide a more comprehensive understanding of their reliability and capability in fulfilling complex defense-related requirements. Their ability to secure this $32 million contract indicates they met the necessary qualifications and competitive standards set by the Army.

How does the value of this contract compare to similar programmatic support contracts for UAS within the DoD?

The $32 million contract value for programmatic support to UAS, spread over approximately 2055 days (roughly 5.6 years), translates to an average annual value of about $5.7 million. This figure is moderate within the context of large-scale defense programs. Contracts for similar specialized support, especially those involving cutting-edge technology like UAS, can range significantly based on scope, complexity, and duration. Some contracts might focus solely on research and development, while others encompass full lifecycle sustainment. Without specific details on the exact services rendered, a precise comparison is difficult, but this contract appears to represent a substantial, yet not exceptionally large, investment in UAS program management.

What are the primary risks associated with this contract, and how are they mitigated?

Key risks for this contract include potential technological obsolescence in the rapidly evolving UAS field, challenges in maintaining consistent performance over a long duration, and the possibility of cost overruns if not managed tightly under the firm fixed price structure. Mitigation strategies likely involve robust program management by the Army, clear definition and control of contract scope, regular performance reviews with Sigmatech Inc., and potentially incorporating mechanisms for adapting to technological advancements. The firm fixed price nature itself acts as a primary risk mitigation tool for the government by capping costs, placing the onus on the contractor to manage expenses effectively.

How effective has the programmatic support provided under this contract been in advancing the Army's UAS capabilities?

The provided data summary does not contain specific metrics on the effectiveness of the programmatic support in advancing the Army's UAS capabilities. Effectiveness would typically be measured through key performance indicators (KPIs) related to program milestones achieved, system readiness rates, successful integration of new technologies, and overall contribution to operational mission success. While the contract's award and duration suggest a perceived need and value, a formal assessment of its effectiveness would require access to program performance reports, operational feedback, and objective evaluations of the UAS programs it supports.

What are the historical spending patterns for programmatic support of UAS within the Department of the Army?

Historical spending patterns for programmatic support of UAS within the Department of the Army have shown a consistent and increasing trend over the past decade, driven by the recognized strategic importance of unmanned systems. This includes investments in research and development, acquisition, training, and sustainment. Contracts like the one awarded to Sigmatech Inc. represent a portion of this broader spending. Analyzing historical data would reveal fluctuations based on defense budgets, evolving threats, and technological advancements, with a general upward trajectory in overall UAS-related expenditures across the military branches.

What is the significance of the 'Engineering Services' classification (NAICS 541330) for this contract?

The classification under NAICS code 541330, 'Engineering Services,' signifies that the core services provided under this contract involve the application of engineering principles and knowledge to support the development, integration, and sustainment of Unmanned Aircraft Systems. This typically includes activities such as systems engineering, technical analysis, design support, testing, and program management oversight. For UAS, this classification underscores the complex technical nature of the program and the need for specialized engineering expertise to ensure the systems are effective, reliable, and meet operational requirements within the defense context.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 689 DISCOVERY DR NW, HUNTSVILLE, AL, 35806

Business Categories: Category Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations

Financial Breakdown

Contract Ceiling: $70,042,947

Exercised Options: $32,077,248

Current Obligation: $32,077,248

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W31P4Q05A0026

IDV Type: IDC

Timeline