DoD's $27.6M F110 Engine Component Improvement Program faces limited competition, impacting value
Contract Overview
Contract Amount: $27,630,722 ($27.6M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2020-01-31
End Date: 2023-12-31
Contract Duration: 1,430 days
Daily Burn Rate: $19.3K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: F110 ENGINE COMPONENT IMPROVEMENT PROGRAM CY2020 TASK ORDER
Place of Performance
Location: CINCINNATI, HAMILTON County, OHIO, 45215
State: Ohio Government Spending
Plain-Language Summary
Department of Defense obligated $27.6 million to GENERAL ELECTRIC COMPANY for work described as: F110 ENGINE COMPONENT IMPROVEMENT PROGRAM CY2020 TASK ORDER Key points: 1. The program focuses on R&D for physical and engineering sciences, specifically engine components. 2. General Electric Company is the sole awardee, raising concerns about competition. 3. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns. 4. The total award value is $27.6 million over a 4-year period.
Value Assessment
Rating: questionable
The Cost Plus Fixed Fee contract type, combined with sole-source award, limits price discovery and potentially inflates costs compared to competitive R&D contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, awarded directly to General Electric Company. This lack of competition limits the government's ability to secure the best possible pricing and innovation.
Taxpayer Impact: Taxpayer funds are potentially being spent at a higher rate due to the absence of competitive bidding, reducing overall value for money.
Public Impact
Enhances critical military aircraft engine performance and reliability. Supports advanced manufacturing and engineering jobs within the aerospace sector. Ensures continued operational readiness for Air Force F110-powered aircraft. Potential for future technological advancements in jet engine technology.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price negotiation.
- Cost-plus contract type can incentivize higher spending.
- Lack of transparency in pricing due to no-bid award.
Positive Signals
- Addresses critical component improvement for military readiness.
- Supports a key defense contractor and associated workforce.
- Long-term contract duration allows for sustained development.
Sector Analysis
This contract falls under Research and Development in the Physical, Engineering, and Life Sciences. Spending in this sector is crucial for technological advancement but requires careful oversight to ensure value, especially when sole-sourced.
Small Business Impact
The sole-source nature of this award provides no direct benefit or opportunity for small businesses. Subcontracting opportunities are not specified but are unlikely to be prioritized in a non-competitive scenario.
Oversight & Accountability
The lack of competition raises questions about the effectiveness of oversight in ensuring fair pricing and optimal value. Further review of the justification for the sole-source award is warranted.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competition
- Cost-plus contract type
- Potential for cost overruns
- Limited transparency in pricing
- No clear small business participation
Tags
research-and-development-in-the-physical, department-of-defense, oh, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $27.6 million to GENERAL ELECTRIC COMPANY. F110 ENGINE COMPONENT IMPROVEMENT PROGRAM CY2020 TASK ORDER
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC 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 $27.6 million.
What is the period of performance?
Start: 2020-01-31. End: 2023-12-31.
What was the justification for awarding this contract sole-source to General Electric Company?
The justification for a sole-source award typically involves factors such as unique capabilities, proprietary technology, or urgent need where only one source can fulfill the requirement. Without specific documentation, it's difficult to assess the validity of this decision. A thorough review would examine if alternative sources were considered and why they were deemed unsuitable.
How does the Cost Plus Fixed Fee structure impact the risk of cost overruns for this program?
Cost Plus Fixed Fee (CPFF) contracts share cost risks between the government and the contractor. While the contractor's profit is fixed, they are incentivized to control costs to maximize their return on investment. However, if costs escalate significantly beyond initial estimates, the government bears the brunt of the increased expenses, making it crucial to have robust cost monitoring and controls in place.
What is the long-term strategic value of investing in F110 engine component improvements through this sole-source contract?
The long-term strategic value lies in maintaining and enhancing the performance and lifespan of critical Air Force assets powered by F110 engines. This ensures continued operational readiness and potentially reduces future maintenance costs. However, the sole-source nature raises concerns about whether the government is achieving the best possible technological advancements and cost-effectiveness compared to a competitive environment.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
Product/Service Code: RESEARCH AND DEVELOPMENT › General Science and Technology R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 1 NEUMANN WAY, CINCINNATI, OH, 45215
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: $27,657,111
Exercised Options: $27,657,111
Current Obligation: $27,630,722
Actual Outlays: $2,262,254
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA862620D0002
IDV Type: IDC
Timeline
Start Date: 2020-01-31
Current End Date: 2023-12-31
Potential End Date: 2023-12-31 00:00:00
Last Modified: 2023-12-07
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