Air Force awards $56.8M contract to Sierra Nevada Company for technical services, with 1,307 days duration

Contract Overview

Contract Amount: $56,798,446 ($56.8M)

Contractor: Sierra Nevada Company, LLC

Awarding Agency: Department of Defense

Start Date: 2021-12-01

End Date: 2025-06-30

Contract Duration: 1,307 days

Daily Burn Rate: $43.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: BIG SAFARI - E014042

Place of Performance

Location: ENGLEWOOD, DENVER County, COLORADO, 80112

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $56.8 million to SIERRA NEVADA COMPANY, LLC for work described as: BIG SAFARI - E014042 Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, which can lead to cost overruns if not managed carefully. 2. The contract was not competed, raising questions about potential price efficiencies and market-driven value. 3. A long duration of 1,307 days suggests a significant, ongoing need for these services. 4. The North American Industry Classification System (NAICS) code 541990 indicates a broad category of 'All Other Professional, Scientific, and Technical Services'. 5. The contract's value of $56.8 million represents a substantial investment in specialized technical support. 6. The award was made to Sierra Nevada Company, LLC, a known entity in the aerospace and defense sector.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific deliverables or performance metrics. The cost-plus-fixed-fee structure necessitates close oversight to ensure costs remain reasonable and that the fixed fee adequately compensates the contractor for the defined scope. Compared to similar broad technical service contracts, the price per day ($43,457) appears high, but this could be justified by highly specialized or unique services required by the Air Force. Further analysis of the contractor's historical performance and the specific nature of the services would be needed for a more definitive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competition from other potential vendors. This approach is typically used when a specific contractor possesses unique capabilities, proprietary technology, or when urgency precludes a competitive process. The lack of competition means that the Air Force did not benefit from the price discovery and potential cost savings that a competitive bidding process could have provided.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure to drive down costs. Without competing offers, it is harder to ascertain if the price reflects the best possible value for the government.

Public Impact

The primary beneficiary is the Department of the Air Force, which will receive specialized technical services. The services delivered are broadly categorized under 'All Other Professional, Scientific, and Technical Services', implying a wide range of potential support functions. The contract is managed by the Department of the Air Force, indicating a focus on Air Force operational needs. The contract's duration suggests a sustained need for these services, potentially impacting long-term planning and resource allocation within the Air Force.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost-plus-fixed-fee contracts require robust oversight to prevent cost escalation.
The broad NAICS code makes it difficult to assess the specific value and necessity of the services without further detail.

Positive Signals

Award to an established contractor (Sierra Nevada Company, LLC) may indicate reliability and expertise.
A long contract duration suggests a stable, ongoing requirement that the contractor is expected to fulfill.
The contract is managed by a specific agency (Department of the Air Force), implying clear programmatic alignment.

Sector Analysis

The professional, scientific, and technical services sector is a significant component of government contracting, encompassing a wide array of support functions. This contract falls under NAICS code 541990, which is a catch-all for services not elsewhere classified. Companies in this space often provide specialized expertise, research, development, and technical consulting. The market size for such services is vast, with government agencies being major clients. This contract represents a portion of the Air Force's spending on specialized technical support, likely to augment organic capabilities or provide expertise not readily available internally.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. The award to Sierra Nevada Company, LLC, a large defense contractor, suggests that the primary focus was on specialized capabilities rather than small business participation. This means that opportunities for small businesses to participate in this specific contract are likely limited unless they are direct suppliers or partners to the prime contractor.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. As a cost-plus-fixed-fee contract, rigorous financial oversight is crucial to monitor expenditures and ensure that costs are reasonable and allocable to the contract. Transparency would depend on the agency's policies regarding the release of contract details and performance reports. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise.

Related Government Programs

Defense-wide Technical Support Services
Air Force Research and Development Support
Professional and Technical Consulting Services
Aerospace Engineering Services

Risk Flags

Sole-source award
Cost-plus-fixed-fee contract type
High daily rate potential
Broad NAICS code lacks specificity

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $56.8 million to SIERRA NEVADA COMPANY, LLC. BIG SAFARI - E014042

Who is the contractor on this award?

The obligated recipient is SIERRA NEVADA COMPANY, LLC.

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 $56.8 million.

What is the period of performance?

Start: 2021-12-01. End: 2025-06-30.

What is the specific nature of the 'All Other Professional, Scientific, and Technical Services' being provided under this contract?

The provided data does not specify the exact nature of the services under NAICS code 541990. This code is a broad category encompassing a wide range of activities, including but not limited to, research and development in the physical, engineering, and life sciences; research in social sciences and psychology; and other professional, scientific, and technical services not elsewhere classified. Without further details from the contract award documentation (e.g., Statement of Work, Performance Work Statement), it is impossible to determine the specific technical functions Sierra Nevada Company, LLC is performing for the Air Force. This lack of specificity makes it difficult to assess the contract's true value and necessity.

How does the daily cost of this contract compare to similar sole-source technical service contracts awarded by the Department of Defense?

The daily cost for this contract is approximately $43,457 ($56,798,446 / 1307 days). Benchmarking this against similar sole-source technical service contracts is challenging without access to a comprehensive database of comparable awards, including their specific scopes of work and pricing structures. However, this daily rate appears to be on the higher end for general technical services. Sole-source awards, by their nature, lack competitive pricing, which can inflate costs. To provide a more accurate comparison, one would need to identify contracts with identical or highly similar NAICS codes, contract types (Cost Plus Fixed Fee), and service complexities awarded under similar market conditions. Without such granular data, this figure serves as a high-level indicator that warrants further scrutiny regarding the justification for the sole-source award and the necessity of such a high daily rate.

What are the potential risks associated with a sole-source, cost-plus-fixed-fee contract of this magnitude and duration?

Sole-source contracts carry inherent risks, primarily the lack of competitive pressure, which can lead to inflated pricing and reduced incentive for efficiency. The cost-plus-fixed-fee (CPFF) structure introduces further risks. While the fee is fixed, the government bears the risk of cost overruns if the contractor's actual costs exceed estimates. This necessitates robust government oversight to monitor expenditures, ensure costs are reasonable and allocable, and prevent scope creep. For a contract valued at $56.8 million and spanning over three years (1307 days), the potential for significant cost increases is substantial if not managed diligently. Risks include contractor inefficiencies going unaddressed, inadequate performance monitoring by the government, and potential for the contractor to prioritize revenue generation over optimal cost management.

What is Sierra Nevada Company, LLC's track record with the Department of the Air Force and similar contracts?

Sierra Nevada Company, LLC (SNC) is a well-established defense contractor known for its work in aerospace and defense systems. They have a history of performing complex technical services and developing advanced technologies for various government agencies, including the Department of Defense and the Air Force. While specific details on their performance for this particular contract (E014042) are not provided in the summary data, SNC generally has a reputation for technical expertise. However, like any large contractor, their performance can vary across different contracts. A deeper dive into their past performance evaluations, any past performance issues, and their success in managing CPFF contracts would be necessary for a comprehensive assessment of their track record relevant to this award.

How does this contract's spending compare to historical Air Force spending on 'All Other Professional, Scientific, and Technical Services'?

To compare this contract's spending ($56.8 million over approximately 3.5 years) to historical Air Force spending on NAICS code 541990, one would need access to historical federal procurement data. This would involve analyzing total Air Force obligations for this specific NAICS code over previous fiscal years. Without that data, it's difficult to contextualize this award. However, $56.8 million is a substantial sum for a single contract, suggesting it represents a significant portion of the Air Force's investment in this broad service category for the contract's duration. If historical spending on this NAICS code has been significantly lower, this contract could indicate an increased reliance on external technical expertise or a new, large-scale initiative.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT 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: 12500 BELFORD AVE, ENGLEWOOD, CO, 80112

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $56,798,446

Exercised Options: $56,798,446

Current Obligation: $56,798,446

Subaward Activity

Number of Subawards: 147

Total Subaward Amount: $18,401,456

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: FA862021G4009

IDV Type: BOA

Timeline