DoD's $44.2M contract for sustainment services awarded to Lockheed Martin Services, LLC

Contract Overview

Contract Amount: $44,251,474 ($44.3M)

Contractor: Lockheed Martin Services, LLC

Awarding Agency: Department of Defense

Start Date: 2019-12-13

End Date: 2020-12-31

Contract Duration: 384 days

Daily Burn Rate: $115.2K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: INCREMENTALLY FUNDING FISCAL YEAR 20 SUSTAINMENT SERVICES.

Place of Performance

Location: COLORADO SPRINGS, EL PASO County, COLORADO, 80916

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $44.3 million to LOCKHEED MARTIN SERVICES, LLC for work described as: INCREMENTALLY FUNDING FISCAL YEAR 20 SUSTAINMENT SERVICES. Key points: 1. Contract awarded via "Not Competed" justification, raising questions about potential cost savings from competition. 2. The contract's duration of 384 days suggests a need for ongoing, critical sustainment support. 3. Fixed-price contract type aims to transfer risk to the contractor, but requires careful monitoring of performance. 4. Awarded as a Delivery Order under an unspecified contract vehicle, limiting transparency on the parent contract's terms. 5. The North American Industry Classification System (NAICS) code 517919 indicates services related to telecommunications infrastructure. 6. The contract's value of $44.2M falls within a moderate spending range for sustainment services.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the lack of competition and the unspecified parent contract vehicle. The firm fixed-price structure is generally favorable for cost control, but without competitive bids, it's difficult to ascertain if the $44.2 million represents a fair market price. Further analysis would require understanding the scope of 'sustainment services' and comparing it to similar sole-source or limited-competition awards for comparable systems or infrastructure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a 'Not Competed' justification, indicating that a competitive process was not utilized. This typically occurs when only one source is capable of meeting the requirement, or in situations where urgency or national security concerns preclude full and open competition. The lack of competition means that the government did not benefit from the price discovery and potential cost reductions that typically arise from multiple bidders vying for a contract.

Taxpayer Impact: Taxpayers may have paid a premium for these services due to the absence of competitive pressure. Without a bidding process, there is less assurance that the price reflects the lowest possible cost for the required sustainment.

Public Impact

The Department of the Air Force benefits from the continuity of sustainment services for critical telecommunications infrastructure. This contract ensures the operational readiness and longevity of essential systems, supporting military communications. The services are likely concentrated in Colorado, where the contractor's "ST" (State) designation is noted. The contract supports the workforce employed by Lockheed Martin Services, LLC, maintaining specialized technical expertise.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
The 'Not Competed' justification requires thorough review to ensure it was appropriate.
Limited transparency due to the award being a Delivery Order under an unspecified contract vehicle.

Positive Signals

Firm Fixed Price contract type shifts cost risk to the contractor.
Sustainment services are critical for maintaining operational readiness of defense systems.
Award to a known entity (Lockheed Martin) suggests a potentially established relationship and understanding of requirements.

Sector Analysis

The telecommunications sector, particularly within defense applications, is characterized by high technological complexity and significant government investment. Contracts for sustainment services in this area are crucial for ensuring the reliability and longevity of sophisticated communication networks and systems. The market often involves a limited number of highly specialized contractors capable of meeting stringent defense requirements. Spending benchmarks for similar sustainment contracts can vary widely based on the criticality and complexity of the systems being supported.

Small Business Impact

The data indicates that this contract was not awarded to a small business (SB is false) and there is no indication of a small business set-aside. Therefore, this contract does not directly contribute to small business prime contracting goals. Subcontracting opportunities for small businesses may exist at the discretion of the prime contractor, Lockheed Martin Services, LLC, but are not explicitly mandated or detailed in the provided information.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. As a firm fixed-price contract, performance monitoring is key to ensuring value for money. Transparency is limited by the 'Not Competed' nature and the fact it's a Delivery Order under an unspecified contract. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Defense Telecommunications Infrastructure Sustainment
Air Force IT and Communications Support Contracts
Lockheed Martin Services Contracts
Federal Sustainment Services

Risk Flags

Sole-source award requires justification review.
Lack of competition may impact price.
Unspecified parent contract vehicle limits transparency.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.3 million to LOCKHEED MARTIN SERVICES, LLC. INCREMENTALLY FUNDING FISCAL YEAR 20 SUSTAINMENT SERVICES.

Who is the contractor on this award?

The obligated recipient is LOCKHEED MARTIN SERVICES, 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 $44.3 million.

What is the period of performance?

Start: 2019-12-13. End: 2020-12-31.

What specific sustainment services are being provided under this contract?

The provided data indicates the contract is for 'INCREMENTALLY FUNDING FISCAL YEAR 20 SUSTAINMENT SERVICES' under NAICS code 517919 (All Other Telecommunications). While the specific services are not detailed, this typically encompasses maintenance, repair, upgrades, and technical support for telecommunications equipment, networks, and related infrastructure. For the Department of the Air Force, this could include ensuring the operational readiness of communication systems vital for command and control, intelligence, surveillance, and reconnaissance, or other critical mission functions. The exact scope would be defined in the contract's statement of work, which is not available in the provided summary.

What is the historical spending pattern for sustainment services related to this specific system or capability?

The provided data does not include historical spending patterns for this specific contract or the underlying system/capability it supports. To assess historical spending, one would need to query federal procurement databases (like FPDS or USASpending) for previous contracts awarded to Lockheed Martin Services, LLC, or other contractors, for similar sustainment services under the same or related NAICS codes and for the Department of the Air Force. Analyzing trends in contract values, durations, and competition levels over several fiscal years would reveal spending patterns and identify any significant deviations or increases.

What is the justification for awarding this contract on a sole-source basis ('Not Competed')?

The justification for awarding this contract on a sole-source basis ('Not Competed') is not detailed in the provided data. Typically, sole-source awards are made when only one responsible source is available to provide the required supplies or services, or when there is a compelling justification for excluding full and open competition, such as urgent and compelling needs, or specific national security requirements. The Department of Defense would have a formal justification document (e.g., a Justification and Approval - J&A) outlining the rationale. Without this document, it is difficult to assess the validity of the sole-source determination and whether competitive alternatives were adequately explored.

How does the $44.2 million contract value compare to similar sustainment contracts within the Air Force or DoD?

Comparing the $44.2 million contract value requires context regarding the specific sustainment services and the systems they support. For large-scale, complex telecommunications infrastructure or mission-critical systems, $44.2 million for a roughly one-year period (December 2019 to December 2020) can be considered a moderate to significant investment. To benchmark effectively, one would need to identify comparable contracts for sustainment of similar telecommunications assets within the Air Force or broader DoD, looking at factors like contract duration, scope of work, and the number of bidders if competed. Given this was 'Not Competed,' a direct value comparison is less meaningful than assessing the justification for the price and scope.

What is Lockheed Martin Services, LLC's track record with the Department of the Air Force for similar services?

Lockheed Martin Services, LLC is a major defense contractor with a substantial history of performing various services for the Department of the Air Force and other military branches. While the provided data doesn't detail their specific performance on this particular sustainment contract, their extensive experience suggests a capacity to handle complex technical requirements. A comprehensive assessment of their track record would involve reviewing past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), other contracts awarded to them for similar services, and any documented issues or commendations related to their service delivery to the Air Force.

Industry Classification

NAICS: Information › Other Telecommunications › All Other Telecommunications

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp

Address: 480 WOOTEN RD STE 104, COLORADO SPRINGS, CO, 80916

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: $45,766,310

Exercised Options: $45,766,310

Current Obligation: $44,251,474

Actual Outlays: $7,283,463

Subaward Activity

Number of Subawards: 95

Total Subaward Amount: $53,703,164

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA882319D0001

IDV Type: IDC

Timeline