DOT awards $11.4M contract for aeronautical information financial investment analysis support to Ernst & Young

Contract Overview

Contract Amount: $11,377,759 ($11.4M)

Contractor: Ernst & Young LLP

Awarding Agency: Department of Transportation

Start Date: 2021-09-28

End Date: 2026-09-29

Contract Duration: 1,827 days

Daily Burn Rate: $6.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: AERONAUTICAL INFORMATION FINANCIAL INVESTMENT ANALYSIS SUPPORT TASK ORDER

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20005

State: District of Columbia Government Spending

Plain-Language Summary

Department of Transportation obligated $11.4 million to ERNST & YOUNG LLP for work described as: AERONAUTICAL INFORMATION FINANCIAL INVESTMENT ANALYSIS SUPPORT TASK ORDER Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract is for administrative management and general management consulting services. 3. A Time and Materials contract type can pose cost control risks if not managed closely. 4. The contract duration is over 5 years, indicating a long-term need for these services. 5. The awardee, Ernst & Young LLP, is a large, established consulting firm. 6. The contract is managed by the Federal Aviation Administration within the Department of Transportation.

Value Assessment

Rating: fair

Benchmarking the value of this specific 'Aeronautical Information Financial Investment Analysis Support' contract is challenging without more granular data on the scope of services. However, the $11.4 million award over approximately five years suggests a significant investment in specialized consulting. The Time and Materials (T&M) pricing structure, while flexible, can lead to higher costs if not carefully monitored for efficiency and necessity of hours. Compared to other large-scale consulting engagements for federal agencies, the per-year cost appears within a reasonable range for complex analytical support, but the ultimate value depends on the tangible outcomes and efficiencies achieved.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. This approach is generally favored for maximizing competition and potentially achieving better pricing. The specific number of bidders is not provided, but the open competition suggests a robust process was intended. The level of competition is a positive indicator for price discovery, as multiple firms likely vied to offer competitive terms.

Taxpayer Impact: Taxpayers benefit from a process designed to solicit the best value through broad market engagement. Full and open competition aims to prevent inflated pricing that might occur in less competitive scenarios.

Public Impact

The Federal Aviation Administration (FAA) is the primary beneficiary, receiving analytical support for financial investments related to aeronautical information. Services delivered include financial investment analysis and management consulting, crucial for informed decision-making within the FAA. The contract's geographic impact is primarily within the District of Columbia, where the Department of Transportation is headquartered. The contract supports specialized consulting roles, potentially impacting the workforce through the engagement of external expertise.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type can lead to cost overruns if not closely managed.
Lack of specific performance metrics makes it difficult to assess the true value-for-money.
The long duration of the contract (over 5 years) requires sustained oversight to ensure continued relevance and efficiency.

Positive Signals

Awarded through full and open competition, indicating a commitment to market-based pricing.
The contractor, Ernst & Young LLP, is a reputable firm with extensive experience in consulting.
The contract addresses a critical need for financial analysis support within the FAA.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically management consulting. The federal government is a significant consumer of these services, utilizing them for complex analysis, strategic planning, and operational improvements. The market for management consulting is vast, with large firms like Ernst & Young competing for substantial government contracts. Comparable spending benchmarks would typically involve analyzing other large consulting contracts awarded by agencies like the DOT or FAA for similar analytical and advisory functions, often measured in millions of dollars annually.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a result, small businesses are unlikely to be direct prime contractors. However, there may be opportunities for small businesses to participate as subcontractors if Ernst & Young chooses to engage them for specialized support. The absence of a small business set-aside means the primary focus was on securing the best overall proposal from the broader market, rather than specifically fostering small business participation.

Oversight & Accountability

Oversight for this contract would primarily reside with the Federal Aviation Administration contracting officers and program managers. Accountability measures are typically embedded within the contract's terms and conditions, including performance standards, reporting requirements, and payment schedules tied to deliverables. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's performance.

Related Government Programs

Federal Aviation Administration Financial Management
Department of Transportation Management Consulting Services
Government Contract Analysis Support
Aeronautical Information Services Funding

Risk Flags

Time and Materials pricing structure
Long contract duration (over 5 years)
Lack of specific performance metrics in summary data

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $11.4 million to ERNST & YOUNG LLP. AERONAUTICAL INFORMATION FINANCIAL INVESTMENT ANALYSIS SUPPORT TASK ORDER

Who is the contractor on this award?

The obligated recipient is ERNST & YOUNG LLP.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $11.4 million.

What is the period of performance?

Start: 2021-09-28. End: 2026-09-29.

What is the specific scope of 'Aeronautical Information Financial Investment Analysis Support' and how is success measured?

The provided data does not detail the specific scope of work for 'Aeronautical Information Financial Investment Analysis Support.' This typically involves analyzing the financial implications of investments in systems, infrastructure, or technologies related to aeronautical information management, such as air traffic control systems, navigation databases, or data processing platforms. Success measurement would likely involve predefined Key Performance Indicators (KPIs) outlined in the contract's Statement of Work (SOW). These could include the accuracy of financial forecasts, the identification of cost-saving opportunities, the timely delivery of analytical reports, and the demonstrable impact of the analysis on investment decisions. Without access to the SOW and performance reports, a definitive assessment of success is not possible.

How does the Time and Materials (T&M) pricing structure compare to other contract types for similar consulting services?

Time and Materials (T&M) contracts are often used when the scope of work is not clearly defined or is expected to evolve, as is common in consulting engagements. They reimburse the contractor for direct labor hours at specified rates and for the actual cost of materials. Compared to Firm-Fixed-Price (FFP) contracts, T&M offers more flexibility but carries a higher risk of cost overruns for the government if not managed diligently. Cost-Plus contracts are another alternative where the government reimburses costs plus a fee, which can be fixed or a percentage of costs. For complex analytical support, T&M can be appropriate if robust oversight is in place to monitor labor hours and ensure efficiency. However, FFP contracts are generally preferred when scope is well-defined, as they provide greater cost certainty for the government.

What is Ernst & Young LLP's track record with the Federal Aviation Administration and the Department of Transportation?

Ernst & Young LLP (EY) is a major global professional services firm with extensive experience in government contracting across various agencies, including the Department of Transportation (DOT) and its sub-agencies like the Federal Aviation Administration (FAA). While specific contract history details require database searches, EY has historically secured numerous contracts for financial advisory, management consulting, IT, and audit services within the federal government. Their track record typically involves large, complex engagements. For the FAA and DOT, EY likely has experience in areas such as financial management, strategic planning, regulatory compliance, and technology implementation. A thorough review of contract databases (like FPDS) would reveal the volume, value, and nature of their past awards with these specific agencies.

What are the potential risks associated with a 5-year Time and Materials contract for consulting services?

The primary risk with a 5-year Time and Materials (T&M) contract is cost escalation. Without strict controls and vigilant oversight, the contractor may bill for excessive hours or inefficient work, driving up the total cost significantly beyond initial estimates. Scope creep is another risk; as the project evolves over five years, the definition of 'time and materials' might expand, leading to unforeseen costs. There's also a risk of reduced incentive for the contractor to innovate or find efficiencies if they are guaranteed reimbursement for hours worked. Furthermore, ensuring the continued relevance and alignment of the consulting services with evolving agency needs over such a long period requires proactive management and potential contract modifications.

How does this $11.4 million contract compare to overall FAA spending on consulting services?

The $11.4 million awarded to Ernst & Young LLP represents a specific investment in financial analysis support for aeronautical information. To contextualize this against overall FAA spending on consulting, one would need to examine the FAA's total budget allocated for professional, scientific, and technical services (NAICS code 541) over the contract's performance period (2021-2026). The FAA, responsible for managing the U.S. air traffic system, often engages consultants for complex technical, financial, and strategic initiatives. While $11.4 million is a substantial sum for a single contract, it is likely a fraction of the FAA's total annual expenditure on external consulting, which can run into hundreds of millions of dollars across various domains, including air traffic modernization, safety analysis, and financial oversight.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 1101 NEW YORK AVENUE, NW, WASHINGTON, DC, 20005

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $15,320,051

Exercised Options: $11,377,759

Current Obligation: $11,377,759

Actual Outlays: $9,470,185

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: 693KA919D00004

IDV Type: IDC

Timeline