Air Force awards Northrop Grumman $32.5M for Ground Subsystems, Engineering Services in Utah
Contract Overview
Contract Amount: $32,504,159 ($32.5M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2021-08-26
End Date: 2026-08-31
Contract Duration: 1,831 days
Daily Burn Rate: $17.8K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: COST PLUS AWARD FEE
Sector: Defense
Official Description: GROUND SUBSYSTEMS CONTRACT 2.0 (GSSC 2.0) - TASK ORDER FOR HAC/RMPE CLS
Place of Performance
Location: HILL AFB, DAVIS County, UTAH, 84056
State: Utah Government Spending
Plain-Language Summary
Department of Defense obligated $32.5 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: GROUND SUBSYSTEMS CONTRACT 2.0 (GSSC 2.0) - TASK ORDER FOR HAC/RMPE CLS Key points: 1. Contract focuses on critical engineering services for ground subsystems, indicating a need for specialized technical support. 2. The award is a delivery order under a larger contract, suggesting a phased approach to fulfilling requirements. 3. The cost-plus award fee structure incentivizes performance while allowing for flexibility in cost management. 4. The duration of over 1800 days points to a long-term, strategic requirement for these services. 5. The absence of small business set-asides suggests the scope or nature of services may not be easily divisible for smaller firms.
Value Assessment
Rating: good
Benchmarking this specific task order's value is challenging without more granular data on the parent contract and the specific services rendered. However, the total award amount of $32.5 million over approximately five years for specialized engineering services in a defense context appears reasonable. The cost-plus award fee (CPAF) structure, while potentially leading to higher costs than fixed-price contracts, allows for adaptation to evolving technical requirements and incentivizes contractor performance through award fees, which can drive value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple capable contractors had the opportunity to bid. The specific number of bidders is not provided, but full and open competition generally fosters a competitive environment, which can lead to better pricing and innovation. This approach aligns with federal acquisition regulations aimed at maximizing competition and achieving best value for the government.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of receiving competitive pricing and high-quality services, preventing potential overspending associated with less competitive award methods.
Public Impact
The Department of the Air Force benefits from specialized engineering services to maintain and enhance ground subsystems. This contract supports critical infrastructure necessary for the operation of Air Force assets. The services are being delivered in Utah, potentially impacting the local economy through employment and related activities. The contract likely requires a skilled workforce of engineers and technical specialists.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus award fee contracts can sometimes lead to higher final costs if not managed diligently.
- The long duration of the contract requires sustained oversight to ensure continued value and performance.
- Lack of specific performance metrics makes it difficult to assess the effectiveness of the award fee component.
Positive Signals
- Awarded under full and open competition, suggesting a competitive bidding process.
- The contract is for engineering services, indicating a focus on technical expertise and problem-solving.
- The long-term nature of the contract provides stability for critical support functions.
Sector Analysis
This contract falls within the Engineering Services sector (NAICS 541330), a significant segment of the federal contracting market. Engineering services are crucial for defense agencies, supporting the design, development, and maintenance of complex systems. Spending in this area is often driven by the need for specialized technical expertise that government personnel may not possess internally. Comparable spending benchmarks would typically involve analyzing other large-scale engineering support contracts awarded by the Department of Defense or other federal agencies for similar types of systems.
Small Business Impact
This contract does not appear to have a small business set-aside (SS=false, SB=false). The nature of advanced engineering services for complex defense systems often requires large-scale capabilities and resources that may not be readily available from small businesses. There is no explicit information on subcontracting plans for small businesses, which could be a missed opportunity to engage the small business ecosystem. Future analysis could explore if subcontracting opportunities exist within the prime contractor's plan.
Oversight & Accountability
Oversight for this contract will likely be managed by the contracting officer and the relevant program management office within the Department of the Air Force. The cost-plus award fee structure necessitates close monitoring of costs and performance against defined criteria to ensure the 'award' portion is justified. Transparency is typically maintained through contract reporting mechanisms, though detailed performance data may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Ground Support Equipment Procurement
- Aerospace Engineering Services
- Department of Defense IT and Engineering Support Contracts
- Air Force Logistics and Maintenance Contracts
Risk Flags
- Potential for cost overruns inherent in CPAF contracts.
- Long contract duration requires sustained oversight.
- Lack of specific performance metrics in public data.
- No explicit small business subcontracting requirements noted.
Tags
defense, department-of-defense, air-force, engineering-services, northrop-grumman, cost-plus-award-fee, delivery-order, full-and-open-competition, utah, ground-subsystems, long-term-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $32.5 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. GROUND SUBSYSTEMS CONTRACT 2.0 (GSSC 2.0) - TASK ORDER FOR HAC/RMPE CLS
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
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 $32.5 million.
What is the period of performance?
Start: 2021-08-26. End: 2026-08-31.
What specific ground subsystems are covered under this task order, and what is the criticality of these subsystems to Air Force operations?
The task order is for the "GROUND SUBSYSTEMS CONTRACT 2.0 (GSSC 2.0) - TASK ORDER FOR HAC/RMPE CLS." While the specific subsystems are not detailed in the provided data, 'HAC/RMPE CLS' likely refers to components related to High Altitude Capabilities, Remote Monitoring, and potentially Command and Logistics Systems. These subsystems are critical for the operational readiness, command and control, and maintenance of various Air Force platforms, including aircraft and associated ground infrastructure. Their proper functioning ensures mission effectiveness, safety, and efficient resource management. The engineering services provided under this task order are essential for maintaining, upgrading, or troubleshooting these vital components, ensuring they meet evolving operational requirements and technological standards.
How does the Cost Plus Award Fee (CPAF) structure compare to other contract types for similar engineering services, and what are its implications for cost control?
Cost Plus Award Fee (CPAF) contracts are often used when the scope of work is not precisely defined or when technical performance is paramount and difficult to pre-define with fixed metrics. Unlike Cost Plus Fixed Fee (CPFF), CPAF includes an incentive component where the contractor can earn an additional fee based on achieving specific performance objectives, which are typically evaluated by the government. Compared to Firm Fixed Price (FFP), CPAF offers more flexibility for the government to adapt to changing requirements but carries a higher risk of cost overrun if not managed carefully. For taxpayers, CPAF can be advantageous if the award fee effectively drives superior performance and innovation, leading to better long-term value. However, it requires robust government oversight to ensure costs remain reasonable and that award fees are earned legitimately, preventing potential cost escalation without commensurate performance gains.
What is the historical spending trend for Ground Subsystems Contracts or similar engineering services within the Department of the Air Force?
Analyzing historical spending trends for Ground Subsystems Contracts or similar engineering services within the Department of the Air Force requires access to comprehensive federal procurement databases. Generally, spending in this category tends to be consistent, driven by the lifecycle needs of complex defense systems. Factors influencing spending include modernization programs, sustainment requirements, and the introduction of new technologies. The Air Force, like other branches of the DoD, consistently invests significant resources in engineering and technical support to maintain its vast inventory of aircraft, vehicles, and command systems. Spending can fluctuate based on specific program priorities, budget allocations, and geopolitical factors, but a baseline level of expenditure for essential engineering services is typically maintained to ensure operational readiness and technological superiority.
What are the key performance indicators (KPIs) used to evaluate Northrop Grumman's performance under this contract, and how are award fees determined?
The specific Key Performance Indicators (KPIs) and the methodology for determining award fees under this task order are not publicly detailed in the provided contract data. However, under a Cost Plus Award Fee (CPAF) structure, KPIs typically revolve around technical performance, schedule adherence, cost management, and quality of deliverables. The government contracting officer or a designated representative evaluates the contractor's performance against these pre-defined criteria. A performance assessment plan (PAP) usually outlines these metrics and the rating scale (e.g., excellent, good, fair, poor). The award fee is then calculated based on the contractor's rating, often as a percentage of the estimated cost or a fixed amount. Robust KPIs are crucial for ensuring the contractor is incentivized to deliver exceptional value and for justifying the award fee to taxpayers.
What is the track record of Northrop Grumman Systems Corporation in delivering similar engineering services to the Department of Defense?
Northrop Grumman Systems Corporation has a long and extensive track record of delivering complex engineering, technology, and defense solutions to the Department of Defense and other government agencies. They are a major defense contractor involved in various programs, including aerospace, defense electronics, and information systems. Their experience spans research and development, system integration, sustainment, and modernization of critical defense assets. While specific performance details for every contract are not always public, Northrop Grumman is generally recognized for its capabilities in handling large-scale, technologically advanced projects. Their history suggests they possess the necessary expertise and infrastructure to manage contracts like the GSSC 2.0 task order, though ongoing oversight is always necessary to ensure optimal performance and value.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 6006 WARDLEIGH RD BLDG 1575, HILL AIR FORCE BASE, UT, 84056
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $32,868,286
Exercised Options: $32,584,455
Current Obligation: $32,504,159
Subaward Activity
Number of Subawards: 18
Total Subaward Amount: $243,447,575
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA821421D0002
IDV Type: IDC
Timeline
Start Date: 2021-08-26
Current End Date: 2026-08-31
Potential End Date: 2026-08-31 00:00:00
Last Modified: 2025-12-10
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