DoD Awards $151M Firm Fixed Price Contract for Delta IV EELV NROL-15 Launch Services
Contract Overview
Contract Amount: $151,022,468 ($151.0M)
Contractor: United Launch Services, LLC
Awarding Agency: Department of Defense
Start Date: 2009-04-06
End Date: 2012-08-31
Contract Duration: 1,243 days
Daily Burn Rate: $121.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: DELTA IV EELV LAUNCH SERVICES FOR NROL-15
Place of Performance
Location: CENTENNIAL, ARAPAHOE County, COLORADO, 80112
State: Colorado Government Spending
Plain-Language Summary
Department of Defense obligated $151.0 million to UNITED LAUNCH SERVICES, LLC for work described as: DELTA IV EELV LAUNCH SERVICES FOR NROL-15 Key points: 1. Contract awarded to United Launch Services, LLC for a single Delta IV EELV launch. 2. The contract is a definitive, firm fixed price agreement with a duration of 1243 days. 3. This procurement falls under Guided Missile and Space Vehicle Manufacturing, with a significant benchmark of $1.21M. 4. The contract was not competed, raising questions about price discovery and potential value. 5. No small business participation was noted in this award.
Value Assessment
Rating: questionable
The contract's value of $151M for a single launch service is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar specialized launch services.
Cost Per Unit: $121,498 (benchmark for Guided Missile and Space Vehicle Manufacturing)
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This limits price discovery and may result in a higher cost to the government compared to a competitive process.
Taxpayer Impact: The lack of competition for this significant contract raises concerns about taxpayer value, as the government may not have secured the best possible price.
Public Impact
National security launch services are critical for intelligence gathering and defense. The reliance on a single provider for specialized launch vehicles can create dependency. Future procurements in this area will be scrutinized for competitive strategies.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Sole-source award
- High contract value
Positive Signals
- Firm fixed price contract type
- Definitive contract award
Sector Analysis
This contract falls within the aerospace and defense sector, specifically focusing on launch services for national security payloads. Spending in this area is highly specialized and often involves unique technological requirements, making direct comparisons challenging.
Small Business Impact
The contract data indicates no small business participation. Given the specialized nature of EELV launch services, it is common for prime contractors to handle the majority of the work, potentially limiting opportunities for smaller businesses in this specific award.
Oversight & Accountability
The Department of Defense, through the Defense Contract Management Agency, is responsible for overseeing this contract. The lack of competition suggests that oversight will focus on ensuring performance and adherence to the firm fixed price terms rather than price negotiation.
Related Government Programs
- Guided Missile and Space Vehicle Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for higher costs due to lack of competition.
- Dependency on a single provider for critical launch services.
- No small business participation noted.
Tags
guided-missile-and-space-vehicle-manufac, department-of-defense, co, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $151.0 million to UNITED LAUNCH SERVICES, LLC. DELTA IV EELV LAUNCH SERVICES FOR NROL-15
Who is the contractor on this award?
The obligated recipient is UNITED LAUNCH SERVICES, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $151.0 million.
What is the period of performance?
Start: 2009-04-06. End: 2012-08-31.
What is the justification for the sole-source award of this critical launch service contract?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or the need for compatibility with existing systems that only one contractor can provide. For EELV launch services, this often relates to specific launch vehicle expertise and established mission assurance protocols required for national security payloads.
What are the potential risks associated with awarding a high-value contract without competition?
Awarding a high-value contract without competition carries risks such as inflated pricing, reduced innovation, and a lack of incentive for the contractor to improve efficiency. It can also create a dependency on a single supplier, potentially limiting future options and increasing vulnerability if that supplier faces issues.
How does the firm fixed price contract type mitigate risk for the government in this sole-source scenario?
A firm fixed price contract type shifts the risk of cost overruns to the contractor, providing budget certainty for the government. In a sole-source situation, this is particularly important as it caps the government's financial exposure, ensuring that the agreed-upon price is the maximum paid, regardless of the contractor's actual costs.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing
Product/Service Code: SPACE VEHICLES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: United Launch Alliance, L.L.C (UEI: 601307601)
Address: 9100 E MINERAL CIR, CENTENNIAL, CO, 80112
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $155,476,560
Exercised Options: $155,476,560
Current Obligation: $151,022,468
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2009-04-06
Current End Date: 2012-08-31
Potential End Date: 2012-08-31 00:00:00
Last Modified: 2016-09-29
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