GSA awards $42.6M sole-source contract to Sierra Nevada Company for software publishing services to the Army

Contract Overview

Contract Amount: $42,613,711 ($42.6M)

Contractor: Sierra Nevada Company, LLC

Awarding Agency: General Services Administration

Start Date: 2022-06-09

End Date: 2025-08-31

Contract Duration: 1,179 days

Daily Burn Rate: $36.1K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SNC SOLE SOURCE IDIQ TO33 ARMY PEO AVN

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35898

State: Alabama Government Spending

Plain-Language Summary

General Services Administration obligated $42.6 million to SIERRA NEVADA COMPANY, LLC for work described as: SNC SOLE SOURCE IDIQ TO33 ARMY PEO AVN Key points: 1. Contract awarded on a sole-source basis, limiting price competition and potentially increasing costs. 2. The contract duration of nearly four years suggests a long-term need for these software services. 3. The fixed-price contract type shifts some performance risk to the contractor. 4. Awarded by GSA for the Army, indicating inter-agency support and a focus on aviation PEO. 5. The North American Industry Classification System (NAICS) code 511210 points to software publishing, a critical sector for modern defense operations.

Value Assessment

Rating: questionable

As a sole-source award, direct comparison to similar contracts is difficult. The lack of competition inherently raises concerns about whether the government achieved the best possible price. Without a competitive bidding process, it's challenging to benchmark the value for money. Further analysis would require understanding the specific software and its market value, which is not provided in the data.

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 responsible source is available or when a compelling justification for other than full and open competition exists. The lack of multiple bidders means there was no direct price negotiation driven by market forces.

Taxpayer Impact: Taxpayers may not have received the most competitive pricing due to the absence of a bidding process. This can lead to higher overall expenditure for the government compared to a competed contract.

Public Impact

The U.S. Army's Program Executive Office Aviation (PEO AVN) is the primary beneficiary, receiving essential software publishing services. This contract supports the operational readiness and technological advancement of Army aviation systems. The services delivered are critical for the development, maintenance, and distribution of software used in defense applications. The contract's impact is primarily national, supporting a key branch of the U.S. military.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing, potentially leading to overpayment.
Lack of transparency in the justification for sole-source award.
Long contract duration could lock in potentially suboptimal pricing if market conditions change.

Positive Signals

Firm fixed-price contract shifts some financial risk to the contractor.
Awarded by GSA, leveraging established procurement channels.
Supports critical Army aviation modernization efforts.

Sector Analysis

The software publishing industry is a vital component of the technology sector, providing essential digital products and services. This contract falls within the broader IT services market, which is experiencing significant growth, particularly in defense applications. Comparable spending benchmarks are difficult to establish without knowing the specific software, but the overall IT spending by the Department of Defense is in the tens of billions annually.

Small Business Impact

This contract was not set aside for small businesses, nor does it indicate any subcontracting requirements for small businesses. As a sole-source award to a specific large contractor, it is unlikely to have a direct positive impact on the small business ecosystem. The focus appears to be on fulfilling a specific need with a known provider rather than fostering broader small business participation.

Oversight & Accountability

The contract is managed by the General Services Administration (GSA), which has established oversight mechanisms for federal contracts. However, as a sole-source award, the level of scrutiny regarding price justification might be less intense than for a competed contract. Transparency is limited by the nature of the sole-source award. Inspector General jurisdiction would apply if any fraud or mismanagement were suspected.

Related Government Programs

Army Aviation Modernization Programs
GSA IT Schedule Contracts
Software Development Services
Defense Software Procurement

Risk Flags

Sole-source award may indicate a lack of market research or limited competition.
Potential for cost overruns due to lack of competitive pricing.
Contract duration may outpace technological advancements in software publishing.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $42.6 million to SIERRA NEVADA COMPANY, LLC. SNC SOLE SOURCE IDIQ TO33 ARMY PEO AVN

Who is the contractor on this award?

The obligated recipient is SIERRA NEVADA COMPANY, LLC.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $42.6 million.

What is the period of performance?

Start: 2022-06-09. End: 2025-08-31.

What is the specific nature of the software publishing services being provided under this contract?

The provided data indicates the NAICS code is 511210, which corresponds to Software Publishers. This generally includes establishments primarily engaged in computer software publishing or involved in the reproduction of software and the manufacturing of software media. For this specific contract, it is likely related to the development, licensing, maintenance, or distribution of software critical to the Army's Program Executive Office Aviation (PEO AVN) operations. Without further details, the exact function (e.g., operating systems, simulation software, data management tools, mission planning software) remains unspecified, but it is integral to supporting Army aviation systems.

What is the justification for this contract being awarded on a sole-source basis?

The data explicitly states 'CT: NOT COMPETED', which signifies a sole-source award. The specific justification for this sole-source determination is not provided in the abbreviated data. Typically, sole-source awards are justified under circumstances such as the existence of only one responsible source, a public exigency, or when the agency determines that full and open competition is not in the best interest of the government. For a contract of this value and duration, a detailed justification document would normally be required by federal acquisition regulations, outlining why other potential sources could not meet the requirement or why competition was impractical.

How does the firm fixed-price contract type affect risk allocation between the government and Sierra Nevada Company, LLC?

A firm fixed-price (FFP) contract is designed to place the maximum risk on the contractor for delivering the specified goods or services at the agreed-upon price. For Sierra Nevada Company, LLC, this means they are obligated to complete the software publishing work within the $42.6 million ceiling, regardless of their actual costs. If their costs exceed the fixed price, their profit margin will decrease, or they may incur a loss. Conversely, if their costs are lower than anticipated, their profit will increase. This contract type incentivizes the contractor to control costs and manage performance efficiently to maximize profit, while providing the government with cost certainty, assuming the scope of work is well-defined.

What is the historical spending pattern for similar software publishing services for the Army's PEO Aviation?

The provided data does not include historical spending patterns for the Army's PEO Aviation or for Sierra Nevada Company, LLC. To assess historical spending, one would need to query federal procurement databases for past contracts awarded to this contractor or for similar software publishing services under the relevant NAICS code (511210) and agency codes for Army aviation. Analyzing past awards would help determine if this $42.6 million contract represents an increase, decrease, or consistent level of spending for these types of services, and whether previous awards were also sole-source or competed.

What are the potential implications of a nearly four-year contract duration for software services?

A contract duration of 1179 days (approximately 3.2 years, extending to August 2025) for software publishing services suggests a long-term, ongoing need for these capabilities within the Army's PEO Aviation. For the contractor, it provides revenue stability and the opportunity to embed their solutions deeply within the customer's operations. For the government, it ensures continuity of service but also carries the risk of technological obsolescence if the software or services do not keep pace with evolving requirements or if better alternatives emerge during the contract period. It also means a significant portion of the budget is committed, potentially limiting flexibility for future procurements.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: IT AND TELECOM - NETWORK

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 47QFLA22Q0127

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Sierra Nevada Corporation

Address: 444 SALOMON CIR, SPARKS, NV, 89434

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $42,613,711

Exercised Options: $42,613,711

Current Obligation: $42,613,711

Actual Outlays: $-1,693,228

Subaward Activity

Number of Subawards: 25

Total Subaward Amount: $17,260,931

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: 47QFLA20D0022

IDV Type: IDC

Timeline