DoD's $26.3M chemical product contract with ATK LAUNCH SYSTEMS LLC awarded on a non-competitive basis
Contract Overview
Contract Amount: $26,319,300 ($26.3M)
Contractor: ATK Launch Systems LLC
Awarding Agency: Department of Defense
Start Date: 2006-03-09
End Date: 2009-07-15
Contract Duration: 1,224 days
Daily Burn Rate: $21.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Place of Performance
Location: CORINNE, BOX ELDER County, UTAH, 84307
State: Utah Government Spending
Plain-Language Summary
Department of Defense obligated $26.3 million to ATK LAUNCH SYSTEMS LLC for work described as: Key points: 1. Contract awarded without competition, raising questions about potential cost savings and market fairness. 2. The contract's duration of 1224 days suggests a significant, long-term need for the specified chemical products. 3. The North American Industry Classification System (NAICS) code 325998 indicates a focus on miscellaneous chemical manufacturing. 4. Awarded by the Department of the Army, this contract falls under the broader Department of Defense spending umbrella. 5. The firm-fixed-price contract type aims to control costs, but the lack of competition limits benchmarking. 6. The absence of small business set-aside flags suggests this contract was not specifically targeted for small business participation.
Value Assessment
Rating: questionable
Without competitive bids, it is difficult to assess if the $26.3 million price represents good value for money. Benchmarking against similar contracts for miscellaneous chemical products is challenging due to the lack of publicly available comparable data for non-competed awards. The firm-fixed-price structure provides cost certainty for the government, but the absence of competition means the government may not have benefited from the most economical pricing available in the market.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed. This typically occurs when only one vendor can provide the required goods or services, or in situations where competition is deemed not to be in the government's best interest. The lack of multiple bidders means there was no opportunity for price discovery through a competitive process.
Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure to lower prices. The government did not leverage the market's full potential to secure the best possible deal.
Public Impact
The Department of Defense benefits from the supply of essential chemical products for its operations. The contract supports the manufacturing sector, specifically in the area of miscellaneous chemical products. The geographic impact is primarily linked to the contractor's location in Utah (UT). The contract likely supports jobs within ATK LAUNCH SYSTEMS LLC and its supply chain.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition may lead to higher prices than a competed contract.
- Sole-source awards can reduce transparency and accountability in government spending.
- Limited insight into alternative solutions or innovative approaches from other potential vendors.
Positive Signals
- Firm-fixed-price contract type helps to control costs once awarded.
- Award to an established entity (ATK LAUNCH SYSTEMS LLC) suggests a known capability.
- Contract duration indicates a sustained need, potentially for critical defense requirements.
Sector Analysis
The chemical manufacturing sector is diverse, encompassing a wide range of products. NAICS code 325998 specifically covers 'All Other Miscellaneous Chemical Product and Preparation Manufacturing.' This category includes establishments primarily engaged in manufacturing chemical products not classified elsewhere, such as adhesives, inks, and industrial gases. Federal spending in this sector supports various defense, industrial, and research needs. Benchmarking is difficult without knowing the specific chemical products procured.
Small Business Impact
There is no indication that this contract was a small business set-aside. The award to ATK LAUNCH SYSTEMS LLC, a known large defense contractor, suggests it was not targeted for small businesses. Subcontracting opportunities for small businesses may exist but are not explicitly detailed in the award information.
Oversight & Accountability
Oversight for this contract would typically fall under the Department of Defense's contracting and financial management oversight structures. The firm-fixed-price nature of the award provides some cost control. However, the lack of competition limits the ability to assess price reasonableness through market comparisons. Transparency is reduced due to the sole-source nature of the award.
Related Government Programs
- Department of Defense Chemical Procurement
- Miscellaneous Chemical Manufacturing Contracts
- Sole-Source Defense Contracts
- Firm Fixed Price Contracts
Risk Flags
- Sole-source award
- Lack of competition
- Limited transparency on specific product details
Tags
department-of-defense, department-of-the-army, atk-launch-systems-llc, not-competed, sole-source, firm-fixed-price, chemical-manufacturing, miscellaneous-chemical-products, utah, large-contract, defense-spending
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $26.3 million to ATK LAUNCH SYSTEMS LLC. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is ATK LAUNCH SYSTEMS LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $26.3 million.
What is the period of performance?
Start: 2006-03-09. End: 2009-07-15.
What specific chemical products were procured under this contract?
The provided data indicates the contract falls under NAICS code 325998, 'All Other Miscellaneous Chemical Product and Preparation Manufacturing.' However, the specific chemical products are not detailed. This category can include a wide array of items such as adhesives, sealants, inks, paints, coatings, industrial gases, and other specialty chemical preparations. Without further details, it is impossible to ascertain the exact nature of the goods supplied, which limits a precise understanding of their criticality or market alternatives.
Why was this contract awarded on a sole-source basis?
The data explicitly states the contract was 'NOT COMPETED,' indicating a sole-source award. Common justifications for sole-source awards include situations where only one responsible source can provide the required supplies or services, or when there is a compelling urgency. Other reasons can include specific research and development efforts where a particular contractor's expertise is essential. Without additional documentation or agency justification, the precise reason for this sole-source award remains unknown, but it implies that a competitive process was either not feasible or not deemed in the government's best interest at the time of award.
What is ATK LAUNCH SYSTEMS LLC's track record with the federal government, particularly in chemical manufacturing?
ATK Launch Systems LLC, now part of Northrop Grumman, has a significant history of contracting with the U.S. federal government, primarily in the aerospace and defense sectors. Their expertise often involves propulsion systems, energetic materials, and related components. While their primary focus is often on large-scale systems, they do engage in the manufacturing of various chemical compounds and materials essential for these systems. Their track record generally reflects extensive experience in complex, high-value government contracts, often involving specialized manufacturing capabilities.
How does the $26.3 million contract value compare to typical spending in this NAICS code?
Comparing the $26.3 million contract value to typical spending within NAICS 325998 is challenging without more specific product information. Miscellaneous chemical manufacturing is a broad category. However, for a single contract of this size awarded over a period of approximately 3.3 years (1224 days), it represents a substantial procurement. Federal spending in chemical manufacturing can range from small R&D grants to multi-billion dollar contracts for large-scale production. This particular award suggests a significant, ongoing need for specific chemical products by the Department of the Army.
What are the potential risks associated with a sole-source award of this magnitude?
The primary risks associated with a sole-source award of this magnitude include potential overpayment due to the lack of competitive pricing, reduced innovation from a lack of market pressure, and a potential decrease in transparency and accountability. Taxpayers may not be receiving the best possible value for their money. Furthermore, reliance on a single source can create supply chain vulnerabilities if that contractor faces production issues or other disruptions. The government also misses opportunities to foster competition and potentially discover new, more cost-effective suppliers.
Industry Classification
NAICS: Manufacturing › Other Chemical Product and Preparation Manufacturing › All Other Miscellaneous Chemical Product and Preparation Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Innovation Systems LLC (UEI: 618705925)
Address: 9160 NORTH HIGHWAY 83, CORINNE, UT, 01
Business Categories: Category Business, Not Designated a Small Business
Parent Contract
Parent Award PIID: W15QKN04D1003
IDV Type: IDC
Timeline
Start Date: 2006-03-09
Current End Date: 2009-07-15
Potential End Date: 2009-07-15 00:00:00
Last Modified: 2013-11-18
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