DoD awards $3.79M for BLU-138/B technical support, with a 5-year performance period

Contract Overview

Contract Amount: $3,786,133 ($3.8M)

Contractor: Applied Research Associates, Inc.

Awarding Agency: Department of Defense

Start Date: 2023-09-15

End Date: 2028-01-31

Contract Duration: 1,599 days

Daily Burn Rate: $2.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: BLU-138/B TECHNICAL SUPPORT

Place of Performance

Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87110

State: New Mexico Government Spending

Plain-Language Summary

Department of Defense obligated $3.8 million to APPLIED RESEARCH ASSOCIATES, INC. for work described as: BLU-138/B TECHNICAL SUPPORT Key points: 1. Contract awarded through full and open competition, suggesting a competitive market. 2. Performance period extends over 5 years, indicating a long-term need for support. 3. Contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 4. The contract is for technical support of the BLU-138/B, a munition component. 5. The awardee, Applied Research Associates, Inc., has a track record in defense contracting. 6. The contract is a delivery order under a larger contract vehicle. 7. The work is to be performed in New Mexico.

Value Assessment

Rating: fair

The contract value of $3.79 million over approximately 5 years for technical support of a specific munition component appears reasonable on its face. However, without detailed breakdowns of labor categories, hours, and overhead rates, a precise value-for-money assessment is difficult. Benchmarking against similar technical support contracts for defense systems would be necessary for a more definitive evaluation. The Cost Plus Fixed Fee (CPFF) contract type introduces some risk, as contractor costs are reimbursed plus a fixed fee, potentially leading to higher final costs than fixed-price contracts if not closely monitored.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple offerors had the opportunity to bid. The specific number of bidders is not provided, but this method generally fosters price discovery and encourages competitive pricing. The Air Force utilized a standard procurement process to solicit proposals, aiming to secure the best value for the government.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it increases the likelihood of receiving competitive pricing and better value for the services rendered.

Public Impact

The primary beneficiaries are the Department of Defense and the Air Force, ensuring continued operational readiness and technical expertise for the BLU-138/B munition. Services delivered include technical support, likely encompassing engineering, testing, analysis, and sustainment activities related to the BLU-138/B. The geographic impact is concentrated in New Mexico, where the contractor will perform the work. Workforce implications may include the creation or sustainment of specialized technical and engineering jobs within the defense industry in New Mexico.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type can incentivize contractor to increase costs to maximize profit.
Lack of specific performance metrics makes it difficult to assess contractor efficiency and effectiveness.
Limited visibility into the specific technical support tasks and their criticality.
Potential for scope creep given the nature of technical support contracts.

Positive Signals

Awarded through full and open competition, suggesting a competitive environment.
Long performance period indicates a sustained need and potential for stable support.
Contractor is likely experienced in defense technical support.
Delivery order structure implies it's part of a broader contracting strategy.

Sector Analysis

This contract falls within the defense industrial base, specifically supporting the manufacturing and sustainment of munitions. The market for technical support services for defense systems is substantial, with significant government spending allocated annually. This contract represents a small portion of overall defense spending but is critical for the specific munition system it supports. Comparable spending benchmarks would involve analyzing other technical support contracts for similar weapon systems or components.

Small Business Impact

The data indicates that small business participation is not a primary focus for this specific contract, as the 'ss' (small business set-aside) field is false and 'sb' (small business) is also false. There is no explicit mention of subcontracting goals for small businesses. Therefore, the direct impact on the small business ecosystem from this particular award appears minimal, though the prime contractor may engage small businesses in their supply chain.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Air Force contracting and program management offices. Accountability measures are typically embedded within the contract terms, including reporting requirements and performance standards. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

BLU-138/B Munition Program
Air Force Munitions Procurement
Defense Technical Support Services
Cost Plus Fixed Fee Contracts
Ammunition Manufacturing Support

Risk Flags

Cost Plus Fixed Fee contract type carries inherent cost escalation risks.
Lack of specific performance metrics makes objective evaluation of contractor success challenging.
Potential for scope creep in technical support services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $3.8 million to APPLIED RESEARCH ASSOCIATES, INC.. BLU-138/B TECHNICAL SUPPORT

Who is the contractor on this award?

The obligated recipient is APPLIED RESEARCH ASSOCIATES, INC..

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 $3.8 million.

What is the period of performance?

Start: 2023-09-15. End: 2028-01-31.

What is the track record of Applied Research Associates, Inc. with similar technical support contracts for the Department of Defense?

Applied Research Associates, Inc. (ARA) has a significant history of performing technical support and research and development services for the Department of Defense. Their portfolio often includes work related to munitions, aerospace systems, and advanced materials. Analyzing ARA's past performance on Cost Plus Fixed Fee (CPFF) contracts specifically would provide insight into their ability to manage costs and deliver within budget. Reviewing past contract awards and performance evaluations for ARA would reveal their experience level and success rate in fulfilling similar technical support requirements, helping to gauge their reliability for the BLU-138/B contract.

How does the awarded value compare to similar technical support contracts for munition components?

A direct comparison of the $3.79 million award for BLU-138/B technical support over approximately five years requires access to data on comparable contracts. Factors such as the complexity of the munition, the specific technical services required (e.g., engineering analysis, testing, sustainment), and the contractor's overhead structure significantly influence pricing. Benchmarking against contracts for technical support of other air-launched munitions or similar weapon systems, considering their duration and scope, would be necessary. Without such comparative data, it's challenging to definitively state whether this award represents a superior or inferior value.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for technical support?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract is the potential for cost overruns. While the contractor is reimbursed for allowable costs, the fixed fee provides a profit incentive. If the contractor's costs escalate beyond initial projections, the government pays these increased costs, plus the predetermined fixed fee. This structure can reduce the contractor's incentive to control costs aggressively compared to fixed-price contracts. Effective oversight, detailed cost tracking, and robust negotiation of the fee are crucial to mitigate these risks and ensure value for the government.

What is the criticality of the BLU-138/B munition and its technical support to Air Force operations?

The BLU-138/B is a component related to munitions, specifically falling under the 'Ammunition (except Small Arms) Manufacturing' North American Industry Classification System (NAICS) code. While the exact operational role and criticality of the BLU-138/B are not detailed in the provided data, technical support for such components is vital for ensuring the reliability, safety, and effectiveness of deployed munitions. Continuous technical support helps maintain readiness, address obsolescence issues, and potentially improve performance or reduce lifecycle costs, thereby contributing to the Air Force's overall mission capabilities.

What has been the historical spending trend for technical support of BLU-138/B or similar munition systems by the Air Force?

Historical spending data for the BLU-138/B specifically is not provided. However, the Air Force consistently allocates significant funds towards the sustainment and technical support of its munition inventory. This includes contracts for engineering services, testing, maintenance, and upgrades. Analyzing broader spending categories related to 'Ammunition Peculiar Equipment,' 'Munitions Maintenance,' or 'Ordnance Support Equipment' over several fiscal years would reveal trends. Such analysis could indicate whether spending on this specific BLU-138/B support contract is consistent with, increasing, or decreasing relative to historical patterns for similar systems.

Are there any performance metrics or key performance indicators (KPIs) defined within this contract to measure success?

The provided data does not specify the performance metrics or Key Performance Indicators (KPIs) associated with this contract. Typically, technical support contracts include clauses that define measurable performance standards, such as response times for technical inquiries, accuracy of technical documentation, successful completion of testing phases, or adherence to project milestones. The absence of this information in the summary data makes it difficult to assess how contractor performance will be evaluated and what constitutes success beyond fulfilling the basic scope of work.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: FA868123RARA1

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 4300 SAN MATEO BLVD NE STE A-220, ALBUQUERQUE, NM, 87110

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

Financial Breakdown

Contract Ceiling: $3,786,133

Exercised Options: $3,786,133

Current Obligation: $3,786,133

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $261,371

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA865621DA007

IDV Type: IDC

Timeline