DoD's $3.5B Army contract for professional services awarded to Army Sustainment LLC shows extended performance duration

Contract Overview

Contract Amount: $3,501,851,264 ($3.5B)

Contractor: Army Sustainment LLC

Awarding Agency: Department of Defense

Start Date: 2003-10-01

End Date: 2020-09-30

Contract Duration: 6,209 days

Daily Burn Rate: $564.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST NO FEE

Sector: Other

Official Description: TEST

Place of Performance

Location: FORT RUCKER, DALE County, ALABAMA, 36362

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $3.50 billion to ARMY SUSTAINMENT LLC for work described as: TEST Key points: 1. The contract value of $3.5 billion over its life suggests a significant investment in professional services. 2. The award to a single entity, Army Sustainment LLC, warrants examination of the competition dynamics. 3. A contract duration spanning over 17 years (October 2003 to September 2020) indicates long-term service needs. 4. The 'All Other Professional, Scientific, and Technical Services' category is broad, requiring clarity on specific deliverables. 5. The contract's performance period is complete, allowing for a retrospective analysis of its outcomes. 6. The absence of small business set-aside flags suggests this was not specifically targeted for small business participation.

Value Assessment

Rating: fair

Benchmarking the value of this $3.5 billion contract is challenging without specific details on the services rendered. The 'All Other Professional, Scientific, and Technical Services' category is very broad. However, the sheer scale and long duration suggest substantial resource allocation. Comparing it to similar large-scale, long-term professional services contracts within the Department of Defense would be necessary for a more precise value assessment. The contract type 'COST NO FEE' implies the government reimburses the contractor for allowable costs but does not pay a fee, which can be a cost-saving measure but also requires robust cost oversight.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION,' indicating that all responsible sources were permitted to submit a bid. The data shows 3 bids were received. While a full and open competition is generally preferred for maximizing competition, the low number of bids (3) for a contract of this magnitude and duration might suggest potential limitations in the market for these specific services or challenges in the solicitation process.

Taxpayer Impact: A full and open competition is intended to drive down prices through market forces. However, with only three bidders, the potential for significant price discovery may have been constrained compared to a scenario with a larger number of competitive offers.

Public Impact

The primary beneficiaries are likely components of the Department of the Army requiring a wide range of professional, scientific, and technical support. Services delivered under this contract would have supported various Army operations and administrative functions. The geographic impact is likely concentrated where Army operations and personnel are located, with a specific mention of Alabama (ST: AL, SN: ALABAMA) as the contractor's location. Workforce implications could include direct employment by the contractor and indirect support roles within the Army's infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The broad nature of 'All Other Professional, Scientific, and Technical Services' could lead to scope creep or misaligned expectations if not clearly defined.
The long duration of the contract (over 17 years) raises concerns about adaptability to evolving technological needs and service requirements.
The 'COST NO FEE' contract type necessitates stringent government oversight to ensure costs are reasonable and allowable, which can be resource-intensive.
A low number of bids (3) in a full and open competition might indicate potential market limitations or barriers to entry for other qualified contractors.

Positive Signals

Awarding under 'FULL AND OPEN COMPETITION' suggests an effort to leverage the broadest possible market.
The contract's completion allows for a definitive assessment of its performance and value.
The contractor, Army Sustainment LLC, likely possesses specialized capabilities to meet the Army's needs over an extended period.
The contract's long duration, while a concern for adaptability, also signifies a stable and consistent service provision for the Army.

Sector Analysis

The professional, scientific, and technical services sector is a vast and critical component of the federal procurement landscape, encompassing a wide array of specialized expertise. This contract falls within this broad category, serving the Department of Defense. The market for such services is highly competitive, with numerous firms offering specialized skills. Benchmarking this $3.5 billion contract would involve comparing its scope and cost to other large, long-term service contracts awarded by the DoD or other federal agencies for similar, albeit broadly defined, professional support.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the scale and nature of the services required were likely beyond the typical capacity or scope of small business set-aside programs. Consequently, the direct impact on the small business ecosystem may be minimal, although the prime contractor could potentially engage small businesses as subcontractors if the contract allowed and required.

Oversight & Accountability

Oversight for this contract would have been managed by the Department of the Army. As a 'COST NO FEE' contract, rigorous financial oversight is paramount to ensure that all reimbursed costs are allowable, allocable, and reasonable. Transparency would be facilitated through contract reporting mechanisms and potentially through Inspector General reviews, especially concerning cost management and performance. Accountability would stem from the contractual terms and performance metrics established.

Related Government Programs

Army Logistics Support Contracts
DoD Professional Services Indefinite Delivery/Indefinite Quantity (IDIQ) Contracts
Technical and Management Support Services Contracts
Base Operations Support Contracts

Risk Flags

Long contract duration may lead to obsolescence or reduced adaptability.
Cost-reimbursement contract type requires robust oversight to control costs.
Broad service category ('All Other Professional, Scientific, and Technical Services') may lack specificity.
Low number of bids could indicate limited competition or market barriers.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $3.50 billion to ARMY SUSTAINMENT LLC. TEST

Who is the contractor on this award?

The obligated recipient is ARMY SUSTAINMENT 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 $3.50 billion.

What is the period of performance?

Start: 2003-10-01. End: 2020-09-30.

What specific types of professional, scientific, and technical services were rendered under this contract?

The provided data categorizes this contract under NAICS code 541990, 'All Other Professional, Scientific, and Technical Services.' This is an extremely broad classification that can encompass a wide variety of activities, including but not limited to research and development support, engineering consulting, environmental services, and specialized technical assistance. Without further details from the contract's statement of work or task orders, it is impossible to specify the exact services provided. The large value and long duration suggest these services were likely mission-critical and ongoing, supporting core Army functions.

How does the $3.5 billion total contract value compare to similar long-term professional services contracts within the DoD?

Comparing the $3.5 billion value of this contract requires context regarding the specific services and duration. For long-term (10+ years) professional services contracts within the DoD, $3.5 billion is a substantial figure, indicative of a major program or sustained support requirement. Many large IDIQ vehicles or major system support contracts can reach or exceed this value. However, without knowing the precise nature of the 'All Other Professional, Scientific, and Technical Services,' a direct comparison is difficult. It suggests a significant and sustained need for specialized expertise over an extended period, placing it among the larger service contracts awarded by the Army.

What are the potential risks associated with a 'COST NO FEE' contract of this magnitude and duration?

The primary risk with a 'COST NO FEE' contract is the potential for uncontrolled cost growth, as the contractor is reimbursed for all allowable costs without a profit incentive tied to cost efficiency. This necessitates robust government oversight to scrutinize every expense. For a contract valued at $3.5 billion over 17 years, the administrative burden of this oversight is significant. Risks include the contractor not being incentivized to find cost savings, potential for inflated costs, and the government bearing the full financial risk if costs escalate beyond initial projections. Effective management requires stringent auditing and clear definitions of allowable costs.

Given the contract ended in 2020, what was the overall performance assessment and impact on Army operations?

The provided data does not include performance metrics or qualitative assessments of this contract's success. To determine the overall performance and impact, one would need to review contract close-out reports, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and potentially conduct interviews with Army personnel who utilized the services. A contract of this size and duration typically supports critical functions, so its successful completion would imply sustained operational capability. Conversely, any performance issues could have led to disruptions or inefficiencies within the supported Army units.

What does the low number of bids (3) in a full and open competition suggest about the market for these services?

A low number of bids (3) in a 'FULL AND OPEN COMPETITION' for a contract of this scale ($3.5 billion) can suggest several possibilities. It might indicate that the specific services required are highly specialized, limiting the number of qualified contractors. Alternatively, the barriers to entry (e.g., security clearances, past performance requirements, technical expertise) might be very high. It could also point to market consolidation, where only a few large firms can handle such extensive requirements. In some cases, it might reflect issues with the solicitation itself, such as unclear requirements or overly burdensome terms, which could deter potential bidders.

What is the significance of the contract being awarded to 'ARMY SUSTAINMENT LLC'?

The name 'ARMY SUSTAINMENT LLC' suggests a company specifically structured or oriented towards providing support and sustainment services to the Army. This could imply a deep understanding of Army logistics, maintenance, or operational support needs. While the name itself doesn't guarantee superior performance, it indicates a potential alignment of focus. The fact that they were awarded a contract of this magnitude suggests they met the stringent requirements of the DoD's full and open competition process, demonstrating the necessary capabilities, capacity, and past performance to secure such a significant award.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Address: 1117 DILLY BRANCH RD, FORT RUCKER, AL, 36362

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $575,150

Exercised Options: $575,150

Current Obligation: $3,501,851,264

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline