Boeing's $80.8M Air Force contract for Little Mountain Test Facility operations awarded without competition
Contract Overview
Contract Amount: $80,821,778 ($80.8M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2017-09-20
End Date: 2024-07-31
Contract Duration: 2,506 days
Daily Burn Rate: $32.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: Defense
Official Description: IGF::CT::IGF OPERATIONS, MAINTENANCE AND TECHNICAL DATA DELIVERY AT LITTLE MOUNTAIN TEST FACILITY
Place of Performance
Location: OGDEN, WEBER County, UTAH, 84404
State: Utah Government Spending
Plain-Language Summary
Department of Defense obligated $80.8 million to THE BOEING COMPANY for work described as: IGF::CT::IGF OPERATIONS, MAINTENANCE AND TECHNICAL DATA DELIVERY AT LITTLE MOUNTAIN TEST FACILITY Key points: 1. Contract awarded on a cost-plus-award-fee basis, potentially leading to higher final costs. 2. Long contract duration of over 6 years suggests a need for sustained services. 3. The absence of competition raises concerns about price reasonableness and potential overspending. 4. Services are critical for test facility operations, indicating a high degree of reliance on the contractor. 5. The contract's value places it in the mid-to-large range for engineering services within the DoD. 6. Performance is in Utah, potentially impacting local workforce and economic activity.
Value Assessment
Rating: questionable
Benchmarking the value of this contract is challenging due to the lack of competitive bids and the cost-plus-award-fee structure, which can obscure true costs. While the total value is substantial, the absence of competition makes it difficult to assess if the government received fair market value. Without comparable sole-source contracts or detailed cost breakdowns, a definitive value-for-money assessment is hindered. The pricing mechanism allows for contractor incentives but also risks cost overruns if not rigorously managed.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning the Department of the Air Force did not solicit bids from multiple potential contractors. This approach is typically used when only one contractor possesses the unique capabilities or resources required for the service, or in cases of urgent need. The lack of competition limits the government's ability to leverage market forces to achieve the best possible price and terms.
Taxpayer Impact: The absence of competition means taxpayers may not benefit from the cost savings that typically arise from a competitive bidding process. This could result in a higher overall expenditure for the services provided.
Public Impact
The primary beneficiaries are the Department of the Air Force and its personnel who rely on the Little Mountain Test Facility for critical testing and evaluation. The contract delivers essential operations, maintenance, and technical data delivery services for the facility. The geographic impact is concentrated in Utah, where the Little Mountain Test Facility is located. The contract supports a workforce involved in specialized engineering and technical support roles.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price discovery and potential cost savings for taxpayers.
- Cost-plus-award-fee structure can lead to higher final costs if not tightly managed.
- Long contract duration may indicate a lack of readily available alternative solutions.
- Limited transparency on specific cost components due to the award fee structure.
Positive Signals
- The Boeing Company has a long-standing relationship with the DoD, suggesting established expertise.
- The contract ensures continuity of critical operations at a vital test facility.
- The award fee mechanism, if structured effectively, can incentivize contractor performance.
- The services provided are essential for national defense capabilities.
Sector Analysis
This contract falls within the Engineering Services sector, a critical component of the broader aerospace and defense industry. The market for specialized facility operations and maintenance is often characterized by high barriers to entry due to technical expertise, security clearances, and specialized equipment requirements. The total addressable market for such services within the DoD is significant, with spending often concentrated among a few large, established defense contractors. This contract represents a specific instance of specialized support within a larger ecosystem of defense-related infrastructure management.
Small Business Impact
This contract does not appear to have a small business set-aside component, as indicated by the 'ss' field being false. Furthermore, the 'sb' field being false suggests there are no explicit subcontracting requirements for small businesses mandated within this specific award. This means that opportunities for small businesses to participate in this contract are likely limited to those that might be engaged by the prime contractor, Boeing, on a voluntary basis, rather than through a formal set-aside or subcontracting plan.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. Accountability measures are typically embedded within the contract's terms and conditions, including performance metrics and reporting requirements tied to the award fee structure. Transparency may be limited due to the sole-source nature and the cost-plus-award-fee structure, which can obscure detailed cost breakdowns. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract.
Related Government Programs
- DoD Test and Evaluation Facilities
- Aerospace Engineering Services
- Defense Infrastructure Operations
- Air Force Logistics and Maintenance Contracts
Risk Flags
- Sole-source award
- Cost-plus-award-fee structure
- Long contract duration
- Lack of transparency on performance metrics
Tags
defense, department-of-defense, air-force, engineering-services, operations-maintenance, sole-source, cost-plus-award-fee, utah, large-contract, test-facility
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $80.8 million to THE BOEING COMPANY. IGF::CT::IGF OPERATIONS, MAINTENANCE AND TECHNICAL DATA DELIVERY AT LITTLE MOUNTAIN TEST FACILITY
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $80.8 million.
What is the period of performance?
Start: 2017-09-20. End: 2024-07-31.
What is the historical spending trend for IGF Operations, Maintenance, and Technical Data Delivery at the Little Mountain Test Facility?
Historical spending data for this specific contract line item is not directly available in the provided snippet. However, the current award of $80.8 million from September 20, 2017, to July 31, 2024 (approximately 2506 days or 6.86 years), suggests an average annual spending of roughly $11.78 million. Without prior contract details or historical obligations, it's impossible to determine a trend. Future analysis would require access to historical contract awards and obligation data for this facility or similar services to identify patterns in spending, potential increases or decreases, and the overall investment in its operations over time.
How does the cost-plus-award-fee (CPAF) structure compare to other contract types for similar engineering services within the DoD?
The Cost-Plus-Award-Fee (CPAF) structure is common for complex services where performance outcomes are difficult to define precisely upfront or where innovation is encouraged. Compared to Firm-Fixed-Price (FFP) contracts, CPAF offers more flexibility for the government to adjust to changing requirements but can lead to higher final costs as the contractor is reimbursed for allowable costs plus a fee that includes an award component based on performance. Fixed-Price Incentive (FPI) contracts also share costs but have a ceiling. For engineering services, FFP is often used for well-defined scopes, while CPAF or Cost Plus Incentive Fee (CPIF) are preferred for R&D or complex support where performance metrics are key and flexibility is needed. The primary concern with CPAF is ensuring robust oversight to manage costs and that the award fee criteria are objective and aligned with government objectives.
What are the specific performance metrics used to determine the award fee for The Boeing Company on this contract?
The provided data does not specify the exact performance metrics used to determine the award fee for The Boeing Company on this contract. Typically, for a Cost-Plus-Award-Fee (CPAF) contract, these metrics are detailed in the contract's Performance Work Statement (PWS) or a separate award fee plan. They often include factors such as timeliness of delivery, quality of technical data, effectiveness of maintenance, responsiveness to requests, and overall operational efficiency of the Little Mountain Test Facility. The government's contracting officer representative (COR) usually evaluates the contractor's performance against these criteria, and the resulting score influences the 'award' portion of the fee.
What is The Boeing Company's track record with similar sole-source engineering services contracts within the Department of Defense?
The Boeing Company has a extensive track record with the Department of Defense, often securing large, complex contracts, including those for engineering services and facility operations. While this specific contract is sole-source, Boeing frequently engages in sole-source or limited-competition awards due to its established position, specialized capabilities, and long-standing relationships with various military branches. Analyzing Boeing's broader portfolio of sole-source contracts would reveal patterns in their ability to manage costs, meet performance requirements, and navigate the complexities of government contracting. However, without specific data on past sole-source engineering services contracts of comparable scope and value, a precise comparison is difficult.
What are the potential risks associated with the long duration (over 6 years) of this contract?
The long duration of this contract, spanning over six years, presents several potential risks. Firstly, it increases the likelihood of cost escalation due to inflation and potential changes in labor or material costs over an extended period, especially under a cost-plus structure. Secondly, it can lead to contractor complacency, where the lack of competitive pressure over time might reduce incentives for continuous improvement or cost efficiency. Thirdly, it may lock the government into a specific technological approach or service provider, making it harder to adapt to new technologies or alternative solutions that emerge during the contract period. Finally, long-term sole-source contracts can sometimes indicate a lack of market dynamism or a failure to develop alternative sourcing strategies.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: FA820717RLMTF
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Address: 465 N MARSHALL WAY, LAYTON, UT, 84041
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $108,670,794
Exercised Options: $101,255,761
Current Obligation: $80,821,778
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA820717D0001
IDV Type: IDC
Timeline
Start Date: 2017-09-20
Current End Date: 2024-07-31
Potential End Date: 2024-07-31 00:00:00
Last Modified: 2024-08-12
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