DoD Awards $65.6M for Advanced High Frequency Capabilities Augmentation to Lockheed Martin
Contract Overview
Contract Amount: $65,622,918 ($65.6M)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2020-04-15
End Date: 2022-10-14
Contract Duration: 912 days
Daily Burn Rate: $72.0K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: ADVANCED EXTREMELY HIGH FREQUENCY CAPABILITIES AUGMENTATION
Place of Performance
Location: LITTLETON, DOUGLAS County, COLORADO, 80125
State: Colorado Government Spending
Plain-Language Summary
Department of Defense obligated $65.6 million to LOCKHEED MARTIN CORP for work described as: ADVANCED EXTREMELY HIGH FREQUENCY CAPABILITIES AUGMENTATION Key points: 1. Significant contract value awarded to a major defense contractor. 2. Sole-source award raises questions about competition and potential cost savings. 3. Focus on advanced capabilities suggests critical national security needs. 4. Engineering services sector is a consistent area of government spending.
Value Assessment
Rating: questionable
The contract is Cost Plus Fixed Fee, which can lead to higher costs if not managed carefully. Without competitive bidding, it's difficult to assess if the $65.6 million price is reasonable compared to market rates for similar engineering services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there was no market pressure to offer the best price.
Taxpayer Impact: The lack of competition for this significant award may result in taxpayers paying a premium for the advanced capabilities.
Public Impact
Enhances critical defense communication systems. Supports advanced technological development within the military. Potential for long-term reliance on a single provider for specialized services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of transparency in pricing
Positive Signals
- Addresses advanced technological needs
- Awarded to a reputable defense contractor
Sector Analysis
This contract falls within the Engineering Services sector, which is a substantial part of federal spending, particularly within the Department of Defense. Benchmarks for similar sole-source engineering contracts are difficult to establish due to the nature of specialized defense work.
Small Business Impact
The contract was awarded to Lockheed Martin Corp, a large prime contractor. There is no indication of small business participation in this specific award, suggesting a lack of subcontracting opportunities for smaller firms.
Oversight & Accountability
The Defense Contract Management Agency is responsible for overseeing this contract. However, the sole-source nature and cost-plus fee structure warrant close scrutiny to ensure cost efficiency and prevent potential overruns.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Lack of competitive bidding
- Potential for cost overruns with CPFF
- Limited transparency in pricing
- No clear small business participation
Tags
engineering-services, department-of-defense, co, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $65.6 million to LOCKHEED MARTIN CORP. ADVANCED EXTREMELY HIGH FREQUENCY CAPABILITIES AUGMENTATION
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $65.6 million.
What is the period of performance?
Start: 2020-04-15. End: 2022-10-14.
What specific advanced capabilities does this contract aim to augment, and how do they directly contribute to national security objectives?
This contract focuses on augmenting 'Advanced Extremely High Frequency Capabilities.' These capabilities are crucial for secure, global satellite communications, enabling command and control, intelligence dissemination, and strategic mission support for the Department of Defense. The augmentation likely aims to enhance the resilience, capacity, or functionality of these vital communication networks, directly supporting national security by ensuring reliable connectivity for critical operations.
Given the sole-source nature, what mechanisms are in place to ensure Lockheed Martin is not overcharging for these engineering services?
While sole-source awards limit competitive pressure, the government typically employs robust oversight for Cost Plus Fixed Fee (CPFF) contracts. This includes detailed audits of Lockheed Martin's incurred costs, negotiation of the fixed fee based on estimated costs and risk, and continuous monitoring of performance and expenditures. The Defense Contract Management Agency (DCMA) plays a key role in ensuring compliance with contract terms and preventing unjustified costs.
How does the 'Cost Plus Fixed Fee' structure impact the government's ability to achieve cost-effectiveness compared to other contract types for this type of service?
The CPFF structure provides flexibility for complex projects where costs are uncertain, allowing the contractor to be reimbursed for allowable costs plus a negotiated fixed fee. However, it shifts cost risk to the government, potentially leading to higher overall costs if initial estimates are inaccurate or if the contractor has less incentive to control expenses. For highly specialized R&D or engineering services like this, CPFF can be appropriate, but it requires diligent oversight to ensure value for money.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL 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: 12257 S WADSWORTH BLVD, LITTLETON, CO, 80125
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $66,517,057
Exercised Options: $66,517,057
Current Obligation: $65,622,918
Actual Outlays: $9,109,540
Subaward Activity
Number of Subawards: 18
Total Subaward Amount: $7,885,838
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA882320D0001
IDV Type: IDC
Timeline
Start Date: 2020-04-15
Current End Date: 2022-10-14
Potential End Date: 2022-10-14 00:00:00
Last Modified: 2025-05-08
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