DoD's $48.5M Telecommunications Sustainment Contract Awarded to Lockheed Martin Services, LLC

Contract Overview

Contract Amount: $48,544,910 ($48.5M)

Contractor: Lockheed Martin Services, LLC

Awarding Agency: Department of Defense

Start Date: 2021-01-01

End Date: 2021-12-31

Contract Duration: 364 days

Daily Burn Rate: $133.4K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SUSTAINMENT SERVICES

Place of Performance

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

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $48.5 million to LOCKHEED MARTIN SERVICES, LLC for work described as: SUSTAINMENT SERVICES Key points: 1. Contract focuses on sustainment services for telecommunications, a critical but often opaque area of defense spending. 2. Sole-source award to Lockheed Martin raises questions about competition and potential for cost savings. 3. The contract's duration of 364 days suggests a short-term need or a bridge to a larger procurement. 4. Fixed-price contract type offers some cost certainty, but the lack of competition limits price discovery. 5. Geographic focus on Colorado for sustainment services may indicate specific operational needs or infrastructure. 6. The absence of small business set-asides or subcontracting plans warrants further investigation into broader economic impact.

Value Assessment

Rating: questionable

Benchmarking the value of this $48.5 million contract is challenging due to the lack of competitive bids and specific service details. The 'All Other Telecommunications' category is broad. Without comparable contract data or a clear breakdown of services rendered, it's difficult to assess if the firm fixed price represents a fair market value. The sole-source nature inherently limits the government's ability to negotiate the best possible price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Lockheed Martin Services, LLC, was solicited. This significantly limits competition and price discovery. The justification for a sole-source award, especially for sustainment services, would typically involve unique capabilities, proprietary technology, or a lack of available alternatives. Without this justification, the lack of competition is a concern.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure, potentially leading to higher costs than if multiple vendors had vied for the contract.

Public Impact

The primary beneficiary is the Department of the Air Force, receiving sustainment services for its telecommunications infrastructure. Services delivered are related to maintaining and supporting telecommunications systems, crucial for operational command and control. The geographic impact is concentrated in Colorado, suggesting a focus on specific Air Force installations or regional operations. Workforce implications are likely internal to Lockheed Martin, with potential for specialized technical roles supporting telecommunications.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition on a significant dollar value contract.
Potential for inflated pricing due to sole-source award.
Limited transparency into the specific sustainment services provided.
Absence of small business participation or subcontracting goals.

Positive Signals

Firm fixed-price contract type provides some cost predictability.
Award to an established contractor like Lockheed Martin may ensure continuity of essential services.
Focus on sustainment addresses the ongoing need to maintain critical infrastructure.

Sector Analysis

The telecommunications sector is vast, encompassing network infrastructure, equipment, and services. Within the defense sector, reliable and secure telecommunications are paramount for mission success. This contract falls under the broader IT and telecommunications services category, which represents a significant portion of federal IT spending. Comparable spending benchmarks are difficult to establish without more specific service details, but sustainment contracts for critical infrastructure often represent substantial, recurring investments.

Small Business Impact

This contract does not appear to include any small business set-aside provisions, nor are there explicit indications of subcontracting requirements for small businesses. The sole-source nature of the award further limits opportunities for small businesses to participate. This could mean a missed opportunity to leverage the innovation and agility of the small business sector and potentially reduce overall costs through subcontracting.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. The Inspector General's office for the Department of Defense may conduct audits or investigations if concerns regarding waste, fraud, or abuse arise. Transparency is limited by the sole-source nature and the lack of publicly available detailed service descriptions. Accountability relies on the contractual terms and the performance monitoring by the Air Force.

Related Government Programs

Defense Information Systems Agency (DISA) contracts
Air Force Network Integration Center contracts
Telecommunications Infrastructure Modernization Programs
DoD IT Sustainment Contracts

Risk Flags

Sole-source award lacks competitive justification.
Potential for overpricing due to lack of competition.
Limited transparency into service scope and value.
No apparent small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $48.5 million to LOCKHEED MARTIN SERVICES, LLC. 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 $48.5 million.

What is the period of performance?

Start: 2021-01-01. End: 2021-12-31.

What specific telecommunications sustainment services are covered under this $48.5 million contract?

The provided data indicates the contract is for 'SUSTAINMENT SERVICES' within the 'All Other Telecommunications' (NAICS 517919) category. However, the specific services are not detailed. This could encompass a wide range of activities, such as maintenance of network hardware, software updates, system diagnostics, repair services, and potentially lifecycle management for telecommunications equipment used by the Department of the Air Force. Without a more granular breakdown, it's difficult to ascertain the exact scope and value of each service component.

What was the justification for awarding this contract on a sole-source basis to Lockheed Martin Services, LLC?

The data explicitly states the contract was 'NOT COMPETED' and is a 'SOLE SOURCE'. Federal procurement regulations typically require full and open competition unless specific exceptions apply. Common justifications for sole-source awards include the existence of only one responsible source capable of providing the required services, unique capabilities or proprietary technology held by the contractor, or in certain emergency situations. For a sustainment contract, it might be argued that Lockheed Martin possesses unique knowledge or access related to specific Air Force telecommunications systems they may have originally provided or integrated. A formal Justification for Other Than Full and Open Competition (JOFOC) would typically be required and should be publicly accessible.

How does the $48.5 million value compare to similar telecommunications sustainment contracts within the DoD?

Direct comparison is difficult without knowing the precise services rendered and the specific systems supported. However, $48.5 million for a one-year sustainment contract is a significant sum. The DoD spends billions annually on telecommunications and IT sustainment. To benchmark this value, one would need to identify contracts with similar scopes (e.g., network sustainment, C4ISR systems support) awarded through competitive processes. If comparable competitive contracts for similar services are significantly lower, it would suggest this sole-source award may not represent optimal value for money. The 'All Other Telecommunications' NAICS code is broad, making precise comparisons challenging.

What is the track record of Lockheed Martin Services, LLC in providing telecommunications sustainment services to the federal government?

Lockheed Martin is a major defense contractor with extensive experience across various technological domains, including telecommunications and IT services. They have a long history of supporting complex government systems. While specific performance metrics for this particular contract are not provided, their overall track record suggests a capacity to deliver large-scale technical services. However, past performance on other contracts, especially those involving similar sustainment requirements and competition levels, would be a more direct indicator of their reliability and efficiency in this specific area.

Are there any performance risks associated with this sole-source sustainment contract?

Performance risks exist in any contract, but a sole-source award can exacerbate certain issues. Without competitive pressure, there might be less incentive for the contractor to proactively identify and mitigate risks or to innovate service delivery. If Lockheed Martin is the only viable option, the government has limited recourse if performance falters, beyond contract termination (which would create its own service disruption risks). Key risks include potential cost overruns if the fixed price was based on inaccurate assumptions, delays in service delivery impacting Air Force operations, or a decline in the quality of sustainment provided due to reduced oversight or competitive drive.

What is the historical spending trend for telecommunications sustainment services by the Department of the Air Force?

Historical spending data for telecommunications sustainment by the Department of the Air Force would reveal trends in investment in this area. Analyzing past contracts, including their value, duration, competition levels, and the specific services procured, can indicate whether spending has been increasing, decreasing, or remaining stable. It can also highlight shifts in technology or strategy. For instance, a trend towards sole-source awards in this category might suggest consolidation in the market or specific strategic decisions by the Air Force. Conversely, a history of competitive bidding would make this sole-source award stand out as an anomaly requiring further scrutiny.

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: $48,544,910

Exercised Options: $48,544,910

Current Obligation: $48,544,910

Subaward Activity

Number of Subawards: 161

Total Subaward Amount: $48,044,085

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA882319D0001

IDV Type: IDC

Timeline