Army awards $785M contract for ammunition, with Pyrotechnic Specialties Inc. securing a significant portion

Contract Overview

Contract Amount: $10,187,483 ($10.2M)

Contractor: Pyrotechnic Specialties, Inc

Awarding Agency: Department of Defense

Start Date: 2003-09-26

End Date: 2008-09-30

Contract Duration: 1,831 days

Daily Burn Rate: $5.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200312!001888!2100!AA09 !U.S. ARMY INDUSTRIAL OPERATIONS !DAAA0903C0066 !A!N! !N! !20030926!20051121!785336256!785336256!785336256!N!PYROTECHNIC SPECIALTIES INC !1661 JUNIPER CREEK RD !BYRON !GA!31008!12260!225!13!BYRON !PEACH !GEORGIA !+000000004066!Y!N!000000000000!1310!AMMUNITION, OVER 30 MM UP TO 75 MM !A6 !AMMUNITION !1000!NOT DISCERNABLE OR CLASSIFIED !332993!E! !3! ! ! ! ! !99990909!B! ! !A! !A!N!J!2!004!K! !Z!N!A! ! !N!B!N!N! ! !A! !B!A!* !A!B!Y!B! ! ! ! ! !0001! !

Place of Performance

Location: BYRON, PEACH County, GEORGIA, 31008

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $10.2 million to PYROTECHNIC SPECIALTIES, INC for work described as: 200312!001888!2100!AA09 !U.S. ARMY INDUSTRIAL OPERATIONS !DAAA0903C0066 !A!N! !N! !20030926!20051121!785336256!785336256!785336256!N!PYROTECHNIC SPECIALTIES INC !1661 JUNIPER CREEK RD !BYRON !GA!31008!12260!225!13!BYRON !PEACH… Key points: 1. Contract awarded for ammunition, specifically over 30mm up to 75mm, indicating a need for specialized ordnance. 2. The contract utilized full and open competition after exclusion of sources, suggesting a potentially complex procurement process. 3. A significant portion of the contract value was awarded to a single entity, raising questions about price competitiveness. 4. The contract duration of over 5 years suggests a long-term requirement for these ammunition types. 5. The primary contractor, Pyrotechnic Specialties Inc., is involved in the manufacturing of ammunition. 6. The contract is firm fixed price, which shifts cost risk to the contractor.

Value Assessment

Rating: fair

The total award amount is $785,336,256. While the data does not provide a direct per-unit cost for the ammunition, the large contract value over a multi-year period suggests substantial investment. Benchmarking against similar large-scale ammunition procurements would be necessary to fully assess value for money. The firm fixed-price nature of the contract indicates that the contractor bears the risk of cost overruns, which can be a positive indicator of value if the price is competitive.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded using 'Full and Open Competition After Exclusion of Sources.' This procurement method implies that while the competition was intended to be open, certain sources may have been excluded for specific reasons, potentially impacting the breadth of competition. The data indicates 4 bids were received, which is a moderate level of competition. A more open competition might have yielded more bids and potentially lower prices.

Taxpayer Impact: The exclusion of certain sources could mean that taxpayers did not benefit from the widest possible range of competitive offers, potentially leading to a less optimal price.

Public Impact

The U.S. Army is the primary beneficiary, receiving critical ammunition supplies. The contract supports the production and delivery of ammunition over 30mm up to 75mm. The contract is geographically located in Georgia, supporting the local economy and workforce in that region. The contract implies a sustained demand for specialized ammunition, potentially impacting military readiness and operational capabilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The procurement method 'Full and Open Competition After Exclusion of Sources' warrants further investigation to understand the rationale behind excluding potential bidders.
The significant contract value awarded to a single entity could indicate a lack of robust competition, potentially impacting price efficiency.
The long contract duration of over 5 years necessitates ongoing monitoring to ensure continued value and performance.
Lack of specific details on the type and quantity of ammunition makes it difficult to benchmark unit costs effectively.

Positive Signals

The firm fixed-price contract structure transfers cost risk to the contractor, which can be beneficial for the government.
The receipt of 4 bids suggests some level of market interest and competition, even with the exclusion of sources.
The contract is awarded to a company specializing in pyrotechnics, indicating a potentially good fit for the specific product requirements.
The contract is managed by the Department of the Army, a major defense procurement entity with established oversight processes.

Sector Analysis

This contract falls within the Defense Industrial Base sector, specifically focusing on the manufacturing of ammunition. The North American Industry Classification System (NAICS) code 332993, 'Ammunition (except Small Arms) Manufacturing,' represents a niche but critical segment of the defense manufacturing industry. The market for such specialized ordnance is largely driven by government demand, with limited civilian applications. The total value of this single contract is substantial, representing a significant portion of spending within this specific sub-sector for the contract period.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss=false, sb=false). Therefore, there are no direct subcontracting implications or specific benefits for small businesses stemming from a set-aside provision. The primary contractor, Pyrotechnic Specialties Inc., is likely a significant player in its field, and its size relative to small businesses is not detailed here. The absence of a small business set-aside means that opportunities for small business participation would typically be driven by the prime contractor's subcontracting plans, if any.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. As a Department of Defense contract, it is also subject to oversight by the Department of Defense Inspector General (DoDIG) for potential fraud, waste, and abuse. Transparency is facilitated through contract databases like FPDS, which provide basic award details. However, the specifics of internal performance monitoring, quality assurance, and accountability measures are not detailed in the provided data.

Related Government Programs

Ordnance Manufacturing Contracts
Department of the Army Ammunition Procurement
Defense Industrial Base Contracts
Firm Fixed Price Defense Contracts
Ammunition Supply Chain Management

Risk Flags

Potential for limited competition due to exclusion of sources.
Lack of detailed unit cost data hinders value assessment.
Long contract duration requires sustained performance monitoring.
Contractor's specific performance history not detailed.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.2 million to PYROTECHNIC SPECIALTIES, INC. 200312!001888!2100!AA09 !U.S. ARMY INDUSTRIAL OPERATIONS !DAAA0903C0066 !A!N! !N! !20030926!20051121!785336256!785336256!785336256!N!PYROTECHNIC SPECIALTIES INC !1661 JUNIPER CREEK RD !BYRON !GA!31008!12260!225!13!BYRON !PEACH !GEORGIA !+000000004066!Y!N!000000000000!1310!AMMUNITION, OVER 30 MM UP TO 75 MM !A6 !AMMUNITION !1000!NOT DISCERNABLE OR CLASSIFIED !332993!E! !3! ! ! ! ! !99990909!B

Who is the contractor on this award?

The obligated recipient is PYROTECHNIC SPECIALTIES, INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $10.2 million.

What is the period of performance?

Start: 2003-09-26. End: 2008-09-30.

What is the specific type and quantity of ammunition being procured under this contract?

The provided data specifies the contract is for 'AMMUNITION, OVER 30 MM UP TO 75 MM.' However, it does not detail the exact types of ammunition within this caliber range (e.g., high explosive, practice rounds, specific projectile types) nor the precise quantities to be delivered. This lack of specificity makes it challenging to perform detailed cost-effectiveness analysis or to compare unit prices accurately against industry benchmarks. Understanding the exact nature of the ordnance is crucial for assessing its tactical utility and the appropriateness of the price paid.

How does the per-unit cost of this ammunition compare to similar contracts or market rates?

Direct per-unit cost comparison is not feasible with the provided data, as it only presents the total contract value ($785,336,256) and the contract duration (1831 days, approximately 5 years). To benchmark the value, one would need the total quantity of units procured under the contract. Without this, it's impossible to calculate a unit price. If unit prices were available, they could be compared against historical contract awards for similar ammunition types, prices from other defense agencies, or commercial market rates if applicable. The firm fixed-price nature suggests the contractor assumed cost risk, but the overall competitiveness of that price remains unverified without quantity and unit cost data.

What was the rationale for excluding certain sources in the 'Full and Open Competition After Exclusion of Sources' procurement method?

The procurement method 'Full and Open Competition After Exclusion of Sources' indicates that while the competition was not restricted to a sole source, certain potential bidders were deliberately excluded. The specific reasons for these exclusions are not detailed in the provided data. Common justifications for such exclusions can include national security concerns, proprietary technology requirements, specific security clearances needed by the contractor, or unique capabilities possessed by only a limited number of firms. Understanding the rationale is critical for assessing whether the exclusion unduly limited competition and potentially impacted the final price paid by taxpayers.

What is the track record of Pyrotechnic Specialties Inc. in fulfilling similar defense contracts?

The provided data identifies Pyrotechnic Specialties Inc. as the primary contractor and indicates their involvement in 'PYROTECHNIC SPECIALTIES INC'. While this suggests a specialization relevant to the contract, it does not offer details on their past performance history, such as on-time delivery rates, quality control metrics, or previous contract values and types. A thorough assessment of their track record would require examining their performance on prior government contracts, including any past issues, awards for excellence, or debriefings from previous solicitations. This information is crucial for evaluating the risk associated with awarding a large, long-term contract to this entity.

How does the total spending on ammunition in this category compare to previous years or other branches of the military?

The provided data focuses on a single contract award and does not offer historical spending patterns for this specific ammunition category (over 30mm up to 75mm) or across different branches of the military. To analyze historical trends, one would need access to broader contract databases covering multiple years and agencies. Comparing this $785 million award over approximately five years to previous annual spending or to similar procurements by the Navy or Air Force would provide context on whether this represents an increase, decrease, or stable level of investment in this type of ordnance. Such analysis is key to understanding the overall strategic importance and budget allocation for this capability.

What are the potential risks associated with a firm fixed-price contract for specialized ammunition?

Firm fixed-price (FFP) contracts place the primary cost risk on the contractor. For specialized ammunition, potential risks include the contractor underestimating production costs, material price fluctuations, or unforeseen technical challenges during manufacturing. If the contractor faces significant cost overruns, they may attempt to cut corners on quality or delivery schedules to maintain profitability, potentially impacting readiness. Conversely, if the initial price was set too high due to inaccurate cost estimation or lack of competition, the government might overpay. Effective oversight is crucial to ensure the contractor meets quality and delivery requirements despite the FFP structure.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1661 JUNIPER CREEK RD, BYRON, GA, 02

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline