DoD awards $53.2M for M212 Flares, lacking competition, raising cost concerns
Contract Overview
Contract Amount: $53,242,208 ($53.2M)
Contractor: ATK Launch Systems LLC
Awarding Agency: Department of Defense
Start Date: 2007-01-11
End Date: 2010-12-01
Contract Duration: 1,420 days
Daily Burn Rate: $37.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: M212 FLARES W/DECAL
Place of Performance
Location: CORINNE, BOX ELDER County, UTAH, 84307
State: Utah Government Spending
Plain-Language Summary
Department of Defense obligated $53.2 million to ATK LAUNCH SYSTEMS LLC for work described as: M212 FLARES W/DECAL Key points: 1. High contract value of $53.2M for flares. 2. Sole-source award to ATK Launch Systems LLC limits competitive pricing. 3. Potential risk of overpayment due to lack of competition. 4. Spending falls within the 'Other' sector, but specific benchmarks are unavailable.
Value Assessment
Rating: questionable
The contract value of $53.2M for M212 Flares is significant. Without competitive bidding, it's difficult to assess if this price is reasonable compared to similar products or historical data.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis to ATK Launch Systems LLC. This lack of competition prevents price discovery and may lead to inflated costs for taxpayers.
Taxpayer Impact: The sole-source nature of this award means taxpayers may be paying a premium for these flares due to the absence of competitive pressure.
Public Impact
Military readiness may be impacted if flare availability or cost is affected by non-competitive awards. Taxpayers bear the financial burden of potentially higher prices due to the lack of competition. Transparency in defense procurement is reduced when contracts are not competed.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for overpricing
Positive Signals
- Contract awarded to a known entity (ATK Launch Systems LLC)
Sector Analysis
This contract falls under the 'Other' sector, specifically related to miscellaneous chemical products. Benchmarking is difficult without more specific industry data for pyrotechnic devices like flares.
Small Business Impact
The data does not indicate any specific provisions or considerations for small businesses in this sole-source award.
Oversight & Accountability
The sole-source nature of this award warrants further oversight to ensure the price paid is fair and reasonable, and to explore future competitive opportunities.
Related Government Programs
- All Other Miscellaneous Chemical Product and Preparation Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Lack of competition
- Potential for inflated pricing
- Supply chain risk (single source)
- Limited transparency
Tags
all-other-miscellaneous-chemical-product, department-of-defense, ut, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $53.2 million to ATK LAUNCH SYSTEMS LLC. M212 FLARES W/DECAL
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 $53.2 million.
What is the period of performance?
Start: 2007-01-11. End: 2010-12-01.
What is the justification for awarding this contract on a sole-source basis, and what steps are being taken to ensure fair pricing?
The justification for a sole-source award typically involves unique capabilities or proprietary technology. Without specific details, it's presumed the Army determined ATK Launch Systems LLC was the only viable source. Oversight should focus on validating this necessity and scrutinizing the pricing structure to prevent overpayment, potentially through independent cost analysis or benchmarking against available market data.
What are the risks associated with relying on a single supplier for critical defense components like flares?
Relying on a single supplier creates significant risks, including supply chain vulnerability, potential price gouging, and lack of innovation. If the sole supplier faces production issues, natural disasters, or financial instability, the military's supply of flares could be jeopardized, impacting readiness. Furthermore, the absence of competition removes the incentive for the supplier to improve efficiency or offer lower prices.
How does this sole-source award impact the overall effectiveness and cost-efficiency of the Department of Defense's procurement strategy?
Sole-source awards, when not strictly necessary, undermine the effectiveness and cost-efficiency of DoD procurement. They bypass the competitive process designed to secure the best value for taxpayers. While sometimes unavoidable for specialized items, frequent sole-source awards suggest potential systemic issues in market research or strategic sourcing, leading to higher overall defense spending than necessary.
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
Financial Breakdown
Contract Ceiling: $53,242,208
Exercised Options: $53,242,208
Current Obligation: $53,242,208
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W15QKN04D1003
IDV Type: IDC
Timeline
Start Date: 2007-01-11
Current End Date: 2010-12-01
Potential End Date: 2010-12-01 00:00:00
Last Modified: 2011-02-10
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