DoD's $67.8M AC-130U Gunship Sustainment Contract Awarded to Boeing Without Competition
Contract Overview
Contract Amount: $67,837,168 ($67.8M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2015-12-31
End Date: 2021-05-31
Contract Duration: 1,978 days
Daily Burn Rate: $34.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: IGF::OT::IGF AC-130U GUNSHIP SUSTAINMENT
Place of Performance
Location: FORT WALTON BEACH, OKALOOSA County, FLORIDA, 32548
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $67.8 million to THE BOEING COMPANY for work described as: IGF::OT::IGF AC-130U GUNSHIP SUSTAINMENT Key points: 1. The contract awarded to The Boeing Company for AC-130U Gunship Sustainment represents a significant expenditure. 2. Lack of competition raises concerns about potential overpricing and limited market exploration. 3. The duration of the contract (1978 days) suggests a long-term reliance on a single provider. 4. This spending falls under the 'Other' sector due to its specialized nature, making direct sector benchmarks difficult.
Value Assessment
Rating: questionable
The contract's value of $67.8M over nearly 2000 days, awarded without competition, makes a direct pricing assessment challenging. Without comparable contracts or bids, it's difficult to determine if the price is fair or inflated.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded as a sole-source, meaning it was not competed. This significantly limits price discovery and potentially leads to higher costs for taxpayers as there was no incentive for multiple vendors to offer competitive pricing.
Taxpayer Impact: The absence of competition likely results in a higher cost to taxpayers than if the contract had been openly competed.
Public Impact
Taxpayers may be paying a premium due to the lack of competitive bidding. The long-term sustainment of a specific aircraft platform relies on a single contractor, posing a potential risk if that contractor faces issues. Transparency in pricing and justification for the sole-source award is crucial for public trust.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
Positive Signals
- Supports critical defense capability (AC-130U Gunship)
Sector Analysis
This contract is for sustainment services for a specialized military aircraft, the AC-130U Gunship. Such specialized defense contracts often have limited competition due to unique requirements and contractor expertise, making direct comparisons to broader sector spending difficult.
Small Business Impact
The data indicates this contract was awarded to The Boeing Company, a large aerospace firm. There is no indication that small businesses were involved in this specific sole-source award, suggesting limited opportunities for SMB participation.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the pricing is reasonable and the services provided are necessary and effective. Audits and reviews by the Department of Defense's Inspector General would be appropriate.
Related Government Programs
- Process, Physical Distribution, and Logistics Consulting Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award lacks competition
- Potential for inflated pricing
- Long contract duration may lock in costs
- Limited transparency on price justification
Tags
process-physical-distribution-and-logist, department-of-defense, fl, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $67.8 million to THE BOEING COMPANY. IGF::OT::IGF AC-130U GUNSHIP SUSTAINMENT
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 $67.8 million.
What is the period of performance?
Start: 2015-12-31. End: 2021-05-31.
What is the justification for awarding this sustainment contract on a sole-source basis, and what steps were taken to ensure fair and reasonable pricing?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or a lack of adequate competition. To ensure fair and reasonable pricing, the agency should have conducted a thorough price analysis, potentially using historical data, cost breakdowns from the contractor, or market research to establish a benchmark, even without competing bids.
What are the risks associated with relying on a single contractor for the long-term sustainment of a critical military asset like the AC-130U Gunship?
The primary risks include potential price escalation over time due to the contractor's market power, reduced incentive for innovation or efficiency improvements, and vulnerability to supply chain disruptions or contractor performance issues. If the sole contractor experiences financial difficulties or operational problems, it could significantly impact the availability and readiness of the AC-130U fleet.
How does the cost of this contract compare to similar sustainment contracts for other specialized military aircraft, if such data is available?
Without access to specific, comparable sole-source sustainment contracts for other specialized military aircraft, a direct cost comparison is difficult. However, the absence of competition inherently raises a red flag regarding potential cost inefficiencies. Agencies should maintain internal benchmarks and conduct robust price negotiations even in sole-source situations.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Process, Physical Distribution, and Logistics Consulting Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 626 ANCHORS ST NW, FORT WALTON BEACH, FL, 32548
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: $67,837,168
Exercised Options: $67,837,168
Current Obligation: $67,837,168
Subaward Activity
Number of Subawards: 41
Total Subaward Amount: $4,372,631
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2015-12-31
Current End Date: 2021-05-31
Potential End Date: 2021-05-31 00:00:00
Last Modified: 2021-05-18
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