DoD awards Northrop Grumman $128M Engineering Services contract under full and open competition

Contract Overview

Contract Amount: $12,847,711 ($12.8M)

Contractor: Northrop Grumman Corporation

Awarding Agency: Department of Defense

Start Date: 2004-05-12

End Date: 2009-06-02

Contract Duration: 1,847 days

Daily Burn Rate: $7.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Place of Performance

Location: LINTHICUM HEIGHTS, ANNE ARUNDEL County, MARYLAND, 21090

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $12.8 million to NORTHROP GRUMMAN CORPORATION for work described as: Key points: 1. Contract awarded to a large, established defense contractor. 2. Significant contract value suggests complex, long-term engineering needs. 3. Full and open competition was utilized, indicating a competitive bidding process. 4. The contract spans over 5 years, highlighting sustained program support.

Value Assessment

Rating: fair

The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. Without specific per-unit data or comparison points for similar engineering services, a precise value assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting multiple bidders participated. This method generally promotes price discovery and competitive pricing, though the Cost Plus Fixed Fee structure introduces complexities.

Taxpayer Impact: Taxpayer funds are utilized for engineering services supporting defense programs. The competitive nature of the award aims to ensure reasonable pricing, but the contract type warrants close oversight to control costs.

Public Impact

Supports critical defense engineering services, impacting national security. The large contract value signifies substantial government investment in this area. Long-term nature of the contract suggests ongoing reliance on these services. Award to a major defense contractor impacts the competitive landscape for engineering services.

Waste & Efficiency Indicators

Waste Risk Score: 69 / 10

Warning Flags

Cost Plus Fixed Fee contract type can incentivize cost escalation.
Lack of specific per-unit cost data hinders detailed value analysis.
Long duration increases exposure to potential scope creep or changing requirements.

Positive Signals

Awarded under full and open competition, promoting market fairness.
Contract awarded to a reputable, experienced defense contractor.
Clear end date provides a defined period for service delivery.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the defense industry. Spending in this area is often driven by complex system development and sustainment needs, with benchmarks varying widely based on project scope and complexity.

Small Business Impact

The data indicates the awardee is Northrop Grumman Corporation, a large business. There is no specific information provided regarding small business participation or subcontracting goals within this award.

Oversight & Accountability

The Cost Plus Fixed Fee contract type necessitates robust oversight from the Defense Contract Management Agency to ensure costs are reasonable and allocable. Regular audits and performance reviews are crucial for accountability.

Related Government Programs

Engineering Services
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Potential for cost overruns due to CPFF structure.
Lack of detailed service scope limits risk assessment.
Long contract duration increases exposure to changing requirements.
No indication of small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.8 million to NORTHROP GRUMMAN CORPORATION. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $12.8 million.

What is the period of performance?

Start: 2004-05-12. End: 2009-06-02.

What is the estimated total cost ceiling for this contract, and how does it compare to similar engineering service contracts awarded by the DoD?

The provided data does not specify a total cost ceiling. Cost Plus Fixed Fee contracts have a target cost and a fixed fee, but the total expenditure can vary. Benchmarking against similar DoD engineering contracts would require access to a broader dataset of contract terms and pricing structures.

What specific engineering services are covered under this contract, and what is the risk of cost overruns given the contract type?

The data only specifies 'Engineering Services' broadly (NAICS 541330). The risk of cost overruns with a Cost Plus Fixed Fee contract is inherent, as the contractor is reimbursed for allowable costs plus a fixed fee. Without detailed service descriptions and performance metrics, assessing the specific risk level is challenging.

How effectively did the full and open competition process ensure value for money for these engineering services?

While full and open competition is designed to foster price discovery, the Cost Plus Fixed Fee structure can complicate direct value-for-money comparisons. The effectiveness relies heavily on the agency's ability to define requirements clearly and manage the contractor's costs rigorously throughout the contract's duration.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › Space R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 7

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Address: 1580 B WEST NURSERY RD, LINTHICUM HEIG, MD

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $13,857,445

Exercised Options: $13,857,445

Current Obligation: $12,847,711

Contract Characteristics

Cost or Pricing Data: YES

Timeline