DoD's $20M Lockheed Martin Contract for In-Plant Support & Engineering Services Lacked Competition
Contract Overview
Contract Amount: $20,108,295 ($20.1M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2008-10-01
End Date: 2017-09-30
Contract Duration: 3,286 days
Daily Burn Rate: $6.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST NO FEE
Sector: Defense
Official Description: IN-PLANT SUPPORT&ENGINEERING SERVICES
Place of Performance
Location: MOORESTOWN, BURLINGTON County, NEW JERSEY, 08057
Plain-Language Summary
Department of Defense obligated $20.1 million to LOCKHEED MARTIN CORPORATION for work described as: IN-PLANT SUPPORT&ENGINEERING SERVICES Key points: 1. Significant spending on engineering services for the Air Force. 2. Sole-source award to Lockheed Martin raises questions about competition. 3. Long contract duration (2008-2017) suggests potential for price creep. 4. Lack of small business participation noted.
Value Assessment
Rating: questionable
The contract value of $20.1M over its duration is difficult to assess without specific deliverables and performance metrics. The 'COST NO FEE' pricing structure can sometimes lead to less incentive for cost control compared to fixed-price contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as competitive pressures are absent.
Taxpayer Impact: The absence of competition likely resulted in higher costs for taxpayers than a fully competed contract would have achieved.
Public Impact
Taxpayers may have overpaid due to the lack of competitive bidding. Limited visibility into the necessity and efficiency of these engineering services. Potential for reduced innovation without market-driven incentives.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of Competition
- Sole-Source Award
- Long Contract Duration
- No Small Business Participation
Positive Signals
- Specific Engineering Services Provided
- Established Contractor Relationship
Sector Analysis
Engineering services are crucial for defense projects, but the lack of competition in this $20.1M contract is a concern. Benchmarks for similar sole-source engineering contracts are difficult to establish without more data.
Small Business Impact
This contract did not involve small businesses, missing an opportunity to support smaller enterprises within the defense industrial base. Future contracts should explore avenues for small business subcontracting.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny regarding the justification for not competing the requirement. Oversight should focus on ensuring the necessity and cost-effectiveness of the services rendered.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of Competition
- Sole-Source Award
- Potential for Inflated Costs
- Limited Oversight Evidence
- No Small Business Participation
Tags
engineering-services, department-of-defense, nj, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $20.1 million to LOCKHEED MARTIN CORPORATION. IN-PLANT SUPPORT&ENGINEERING SERVICES
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN 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 $20.1 million.
What is the period of performance?
Start: 2008-10-01. End: 2017-09-30.
What specific engineering services were provided under this contract, and how did they contribute to the Air Force's mission?
The contract was for 'IN-PLANT SUPPORT&ENGINEERING SERVICES.' While specific details are not provided, these services likely encompassed technical support, design, analysis, and problem-solving directly related to Air Force systems or platforms. The 'COST NO FEE' structure suggests the contractor was reimbursed for allowable costs without an additional profit margin, but the overall value and necessity of the services are key to assessing their contribution.
What was the justification for awarding this contract on a sole-source basis instead of competing it?
The data indicates the contract was 'NOT COMPETED,' implying a sole-source justification was made. Common reasons include unique capabilities, urgent needs, or existing contractor integration. However, without the specific justification documented, it's impossible to verify if it was appropriate and if alternatives were adequately explored, raising concerns about potential missed savings.
How does the 'COST NO FEE' pricing structure impact the overall effectiveness and taxpayer value of this contract?
The 'COST NO FEE' structure means the contractor is reimbursed for approved costs but does not earn a profit. While this might seem beneficial, it can reduce the contractor's incentive to control costs aggressively, as their primary focus might shift to ensuring costs are allowable rather than minimizing them. This can impact taxpayer value if costs are not rigorously managed and scrutinized.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SPECIAL STUDIES/ANALYSIS, NOT R&D › SPECIAL STUDIES - NOT R and D
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST NO FEE (S)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 199 BORTON LANDING RD, MOORESTOWN, NJ, 08057
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $28,508,022
Exercised Options: $20,245,925
Current Obligation: $20,108,295
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2008-10-01
Current End Date: 2017-09-30
Potential End Date: 2017-09-30 00:00:00
Last Modified: 2017-06-22
More Contracts from Lockheed Martin Corporation
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Department of Defense)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Department of Defense)
- THE Purpose of This Modification IS to Award F-35A Lrip 15 Usaf Aircraft* Long Lead Funding — $30.1B (Department of Defense)
- THE Purpose of This Contract IS to Award Long Lead Funding for F-35A, F-35B, and F-35C Aircraft for U.S. Services, Non-Dod Partners, and FMS Customers — $24.5B (Department of Defense)
- Lrip 11 AAC — $12.3B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)