DoD's $32.2M Lockheed Martin contract for support services shows fair value despite limited competition
Contract Overview
Contract Amount: $32,230,044 ($32.2M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2019-02-22
End Date: 2023-08-21
Contract Duration: 1,641 days
Daily Burn Rate: $19.6K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: IGF::OT::IGF CPFF - BASE PERIOD
Plain-Language Summary
Department of Defense obligated $32.2 million to LOCKHEED MARTIN CORPORATION for work described as: IGF::OT::IGF CPFF - BASE PERIOD Key points: 1. Contract value appears reasonable given the specialized nature of support services. 2. Competition was limited, potentially impacting price discovery and taxpayer value. 3. Performance risk is moderate, typical for complex support contracts. 4. Contract duration of over 4 years suggests a stable, long-term need. 5. This contract falls within the broader IT and professional services sector for defense. 6. No small business set-aside was utilized, indicating a focus on large prime contractors.
Value Assessment
Rating: good
The contract's total value of $32.2 million over approximately 4.5 years suggests a moderate annual spend. Benchmarking against similar support services contracts within the Department of Defense is challenging without more granular data on the specific services rendered. However, the Cost Plus Fixed Fee (CPFF) structure implies that costs are reimbursed, with a fixed fee for profit, which can be efficient if managed well. The pricing appears fair in the context of specialized defense support, though a more competitive environment could have potentially driven costs lower.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The 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. Limited competition can arise for specialized services where only a few contractors possess the necessary expertise or security clearances. This can lead to higher prices than in a more crowded market.
Taxpayer Impact: While full and open competition was advertised, the actual level of participation is key. If few bids were received, taxpayers may have paid a premium compared to a scenario with robust competition.
Public Impact
The U.S. Special Operations Command benefits from specialized support services essential for its operations. This contract likely supports critical functions related to intelligence, logistics, or technical assistance for special operations. The geographic impact is primarily within the purview of U.S. Special Operations Command activities, which can be global. Workforce implications may include highly skilled personnel in specialized support roles, potentially contributing to the defense industrial base.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns inherent in CPFF contracts if not closely monitored.
- Limited competition may have resulted in a higher price than achievable in a more robust bidding environment.
- The specialized nature of services could create vendor lock-in if alternatives are scarce.
Positive Signals
- Awarded through full and open competition, ensuring a broad initial opportunity for offerors.
- Lockheed Martin is a major defense contractor with a proven track record, suggesting reliability.
- The contract duration indicates a stable requirement and potential for consistent service delivery.
Sector Analysis
This contract falls within the broader professional, scientific, and technical services sector, specifically supporting defense operations. The market for such specialized support services is dominated by large, established defense contractors. Spending in this category is significant within the Department of Defense, often driven by complex mission requirements and advanced technology integration. Comparable spending benchmarks would typically be found within IT services, engineering support, and specialized logistics for government agencies.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the requirement was likely fulfilled by large prime contractors, such as Lockheed Martin. There is no explicit information on subcontracting plans for small businesses, which is a common practice in larger defense contracts to ensure broader industry participation and meet federal small business goals.
Oversight & Accountability
Oversight for this contract would typically fall under the U.S. Special Operations Command's contracting and program management offices. The Department of Defense Inspector General's office also provides oversight for defense contracts, investigating fraud, waste, and abuse. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance details may be sensitive.
Related Government Programs
- Defense-wide Support Services
- Special Operations Forces Support
- Information Technology Support Services
- Professional and Technical Services
- Cost-Plus Contracts
Risk Flags
- Potential for cost creep in CPFF contracts.
- Limited competition may impact price.
- Broad service category lacks specificity.
Tags
department-of-defense, u.s.-special-operations-command, lockheed-martin-corporation, cost-plus-fixed-fee, full-and-open-competition, support-services, professional-services, defense-contracting, cpff, all-other-support-services
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $32.2 million to LOCKHEED MARTIN CORPORATION. IGF::OT::IGF 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 $32.2 million.
What is the period of performance?
Start: 2019-02-22. End: 2023-08-21.
What specific types of 'All Other Support Services' were provided under this contract?
The classification 'All Other Support Services' (NAICS 561990) is very broad and encompasses a wide range of non-classified support activities. For this specific Lockheed Martin contract with U.S. Special Operations Command, these services could potentially include areas such as program management, administrative support, logistics coordination, technical assistance, training development, or specialized operational support. Without further details from the contract's statement of work or performance reports, the precise nature of these services remains unspecified. However, given the agency (SOCOM), it is likely related to specialized operational or intelligence support functions critical to special operations missions.
How does the Cost Plus Fixed Fee (CPFF) pricing structure compare to other contract types for similar services?
The Cost Plus Fixed Fee (CPFF) structure is common for research and development or complex services where the scope of work is not precisely defined at the outset, making fixed-price contracts difficult. In a CPFF contract, the contractor is reimbursed for all allowable costs plus a predetermined fixed fee representing profit. This contrasts with Firm-Fixed-Price (FFP) contracts, where the price is set regardless of actual costs, incentivizing contractor efficiency. Cost-reimbursement contracts like CPFF can offer flexibility but carry a higher risk of cost overruns if not rigorously managed and monitored by the government. For specialized support services, CPFF is often chosen to ensure the contractor can adapt to evolving requirements while maintaining a predictable profit margin.
What is Lockheed Martin's performance history with the U.S. Special Operations Command?
Lockheed Martin Corporation is a major defense contractor with extensive experience supporting various U.S. military branches, including U.S. Special Operations Command (SOCOM). Their performance history with SOCOM typically involves providing a wide array of services, from advanced technology solutions and intelligence support to logistical and operational assistance. While specific performance metrics for individual contracts are often not publicly detailed, Lockheed Martin generally maintains a strong track record in delivering complex defense systems and services. Past performance is a critical factor in contract awards, and their continued success in securing large contracts with SOCOM suggests a satisfactory or better performance history.
Were there any significant cost underruns or overruns reported for this contract?
The provided data does not include specific details on cost underruns or overruns for this particular contract. As a Cost Plus Fixed Fee (CPFF) contract, the government reimburses allowable costs incurred by Lockheed Martin, plus a fixed fee. Significant deviations from the estimated cost could occur if the scope of work changed substantially or if unforeseen challenges arose. Effective contract management and oversight by the U.S. Special Operations Command are crucial to controlling costs within a CPFF arrangement. Without access to detailed financial reports or audit findings related to this contract, it is impossible to definitively state whether there were significant cost variances.
How does the $32.2 million total award compare to annual spending on similar support services by SOCOM?
The total award of $32.2 million over approximately 4.5 years equates to an average annual spend of roughly $7.16 million. Comparing this to SOCOM's overall annual spending on similar support services requires access to broader budget data and contract databases. SOCOM procures a vast range of services, and 'All Other Support Services' is a broad category. However, this figure appears moderate within the context of SOCOM's substantial budget, which often includes multi-billion dollar procurements for advanced technologies, intelligence, and operational support. This specific contract likely represents a segment of their overall support services expenditure, rather than a dominant portion.
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
Parent Company: Lockheed Martin Corp
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: $32,230,044
Exercised Options: $32,230,044
Current Obligation: $32,230,044
Actual Outlays: $27,168
Subaward Activity
Number of Subawards: 37
Total Subaward Amount: $106,820,029
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
Start Date: 2019-02-22
Current End Date: 2023-08-21
Potential End Date: 2023-08-21 00:00:00
Last Modified: 2023-09-28
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