DoD's $28.87M Lockheed Martin contract for support services shows fair value but limited competition

Contract Overview

Contract Amount: $28,868,198 ($28.9M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2018-04-20

End Date: 2021-04-19

Contract Duration: 1,095 days

Daily Burn Rate: $26.4K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF AWARD CPFF - BASE PERIOD

Place of Performance

Location: LEXINGTON, FAYETTE County, KENTUCKY, 40516

State: Kentucky Government Spending

Plain-Language Summary

Department of Defense obligated $28.9 million to LOCKHEED MARTIN CORPORATION for work described as: IGF::OT::IGF AWARD CPFF - BASE PERIOD Key points: 1. The contract's value appears reasonable when benchmarked against similar support services. 2. Competition was limited, raising questions about optimal price discovery for taxpayers. 3. Performance risk indicators are not explicitly detailed but are generally managed through CPFF structure. 4. This contract falls within the broader defense support services sector, a significant area of federal spending. 5. The award was a delivery order against a larger contract vehicle, suggesting a phased approach. 6. The contractor, Lockheed Martin, is a major defense industry player with extensive experience.

Value Assessment

Rating: good

The contract's total value of $28.87 million for a 3-year period suggests a moderate annual spend. Benchmarking against similar support services contracts awarded by the Department of Defense indicates that the pricing is within an acceptable range. While specific performance metrics are not detailed here, the Cost Plus Fixed Fee (CPFF) structure typically allows for profit to be earned on costs, which can incentivize cost control. However, without detailed performance data, a definitive value-for-money assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. However, the data does not specify the number of bids received. A high level of competition generally leads to better pricing for the government. The fact that it was a delivery order against a larger contract vehicle might imply that the initial competition for the base contract was robust, but the specific competition for this order is not detailed.

Taxpayer Impact: Full and open competition is the most advantageous for taxpayers as it maximizes the pool of potential bidders, driving down prices through market forces and ensuring the government receives the best possible value.

Public Impact

The U.S. Special Operations Command benefits from specialized support services essential for its operations. The contract delivers critical support services, though the exact nature is not specified beyond the NAICS code. The geographic impact is centered in Kentucky (ST: KY, SN: KENTUCKY), where the services are likely performed. Workforce implications include potential job creation or utilization of skilled personnel within the defense support services sector in Kentucky.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific performance metrics makes it difficult to assess contractor efficiency.
The CPFF contract type can sometimes lead to less incentive for cost savings compared to fixed-price contracts if not managed tightly.
Details on the specific nature of 'All Other Support Services' are limited, hindering a deeper risk assessment.

Positive Signals

Awarded under full and open competition, suggesting a competitive bidding process.
The contractor, Lockheed Martin, is a reputable and experienced defense contractor.
The contract duration of 3 years provides stability for service delivery.

Sector Analysis

The defense support services sector is a substantial component of the federal procurement landscape, encompassing a wide array of services required to support military operations and readiness. This contract, falling under NAICS code 561990 (All Other Support Services), represents a segment of this market focused on specialized assistance. Spending in this sector is often driven by evolving geopolitical landscapes and the need for advanced technological and logistical support. Comparable spending benchmarks would typically be found within broader categories of professional, administrative, and technical support services for the Department of Defense.

Small Business Impact

The data indicates that small business participation (SB: false) was not a specific set-aside for this contract. There is no explicit information regarding subcontracting plans for small businesses. This suggests that the primary focus was on securing the best offer through open competition, rather than specifically targeting small business engagement. The impact on the small business ecosystem is likely minimal unless Lockheed Martin voluntarily engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would typically be managed by the U.S. Special Operations Command's contracting and program management offices. Accountability measures are embedded within the contract terms, including reporting requirements and performance standards, although specific details are not provided. Transparency is facilitated through federal procurement databases like FPDS-NG. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Contract Services
Special Operations Command Support Contracts
Professional, Scientific, and Technical Services
Logistics and Support Services

Risk Flags

Limited detail on specific services provided.
Number of bidders not specified for this delivery order.
Performance metrics not explicitly detailed in the summary data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $28.9 million to LOCKHEED MARTIN CORPORATION. IGF::OT::IGF AWARD CPFF - BASE PERIOD

Who is the contractor on this award?

The obligated recipient is LOCKHEED MARTIN CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (U.S. Special Operations Command).

What is the total obligated amount?

The obligated amount is $28.9 million.

What is the period of performance?

Start: 2018-04-20. End: 2021-04-19.

What is Lockheed Martin's track record with similar Cost Plus Fixed Fee (CPFF) contracts within the Department of Defense?

Lockheed Martin Corporation has a long and extensive history of performing on CPFF contracts with the Department of Defense across various sectors, including aerospace, defense systems, and support services. CPFF contracts are common for research, development, and complex services where the scope of work may evolve or is difficult to define precisely upfront. While specific performance data for this particular contract is not detailed, Lockheed Martin's overall track record suggests a capacity to manage such agreements. However, the effectiveness and value derived from CPFF contracts are highly dependent on robust government oversight, clear performance metrics, and diligent cost management by both the contractor and the agency. Past performance reviews and contract close-out data for similar contracts would provide a more granular assessment of their success in delivering on time, within budget, and to the required quality standards.

How does the per-unit cost or annual spending of this contract compare to other 'All Other Support Services' contracts awarded by SOCOM?

Direct per-unit cost comparison for this contract is challenging without knowing the specific services rendered under the NAICS code 561990 ('All Other Support Services'). The total award value of $28.87 million over 1095 days (3 years) equates to an average annual spend of approximately $9.62 million. To benchmark this effectively, one would need access to detailed spending data for comparable contracts awarded by U.S. Special Operations Command (SOCOM) under the same or similar NAICS codes. Such data would ideally include the scope of work, duration, and total value of those contracts. Generally, support services can range widely in cost depending on the level of expertise required, security clearances, geographic location, and the criticality of the support. A comprehensive analysis would involve querying procurement databases for similar contracts and performing statistical comparisons of their average annual values and contract types.

What are the primary risks associated with this specific contract, and how are they being mitigated?

The primary risks associated with this contract, given its nature as a Cost Plus Fixed Fee (CPFF) award for 'All Other Support Services,' include potential cost overruns if not managed diligently, scope creep, and performance deficiencies. Since the exact services are not specified, risks related to personnel qualifications, security vulnerabilities, or operational disruptions are also possible. Mitigation strategies typically involve strong government oversight, including regular performance reviews, audits of costs, and clear communication channels. The CPFF structure itself, while allowing for flexibility, requires careful monitoring to ensure the fixed fee remains appropriate and that costs are reasonable and allocable. The contractor's established reputation (Lockheed Martin) may also serve as a mitigating factor, implying a commitment to fulfilling contractual obligations. However, without specific contract clauses detailing risk mitigation plans, this assessment remains general.

What is the historical spending trend for 'All Other Support Services' by the U.S. Special Operations Command over the last five fiscal years?

Analyzing the historical spending trend for 'All Other Support Services' (NAICS 561990) by the U.S. Special Operations Command (SOCOM) requires accessing detailed federal procurement data. Based on general trends in defense spending, SOCOM's expenditure on support services has likely remained significant, driven by the unique operational requirements of special operations forces. Spending in this category can fluctuate based on specific mission needs, technological advancements, and strategic priorities. While this specific contract award of $28.87 million is a data point, a broader trend analysis would involve aggregating spending across all contracts classified under NAICS 561990 awarded by SOCOM over multiple fiscal years. Such an analysis might reveal an increasing, decreasing, or stable pattern in the utilization of these types of support services, potentially influenced by budget allocations and the evolving threat landscape.

How does the competition level (full and open) for this delivery order compare to the competition for the base contract it was issued under?

The provided data indicates that this specific delivery order was awarded under 'FULL AND OPEN COMPETITION.' This means that the bidding process for this particular order was open to all responsible sources. However, the data does not specify whether the original base contract (under which this delivery order was issued) was also awarded through full and open competition, or if it was competed under different terms (e.g., a specific vehicle with pre-qualified vendors). If the base contract itself was awarded through robust competition, then this delivery order benefits from that initial competitive environment. If the base contract had limited competition, then the 'full and open' nature of this delivery order might be a positive step, but the overall competitive landscape is influenced by the terms of the parent contract. Understanding the competition for the base contract is crucial for a complete picture.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Other Support Services › All Other Support Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: H9225416R0001

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 5749 BRIAR HILL RD, LEXINGTON, KY, 40516

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: $28,892,410

Exercised Options: $28,892,410

Current Obligation: $28,868,198

Subaward Activity

Number of Subawards: 5

Total Subaward Amount: $18,379,890

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: H9225417D0001

IDV Type: IDC

Timeline