DoD's $9.6M contract for support services awarded to Lockheed Martin shows fair competition and potential value

Contract Overview

Contract Amount: $9,620,996 ($9.6M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2022-07-18

End Date: 2023-07-17

Contract Duration: 364 days

Daily Burn Rate: $26.4K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: TAPO MROI FY22-23

Place of Performance

Location: LEXINGTON, FAYETTE County, KENTUCKY, 40516

State: Kentucky Government Spending

Plain-Language Summary

Department of Defense obligated $9.6 million to LOCKHEED MARTIN CORPORATION for work described as: TAPO MROI FY22-23 Key points: 1. The contract was awarded through full and open competition, suggesting a competitive pricing environment. 2. While specific performance metrics are not detailed, the contract duration of one year allows for focused evaluation. 3. The award to a large, established contractor like Lockheed Martin indicates a focus on proven capabilities. 4. The contract type (Cost Plus Fixed Fee) can incentivize cost control while ensuring necessary services are delivered. 5. The geographic location in Kentucky may point to specific operational needs or existing infrastructure. 6. The absence of small business set-aside flags suggests this was not specifically targeted for smaller enterprises.

Value Assessment

Rating: good

Benchmarking this specific $9.6 million contract is challenging without detailed service descriptions or comparable contracts. However, the Cost Plus Fixed Fee (CPFF) structure, while potentially leading to higher costs than fixed-price contracts, allows for flexibility in scope and is often used when costs are difficult to estimate upfront. The fixed fee component provides a ceiling for contractor profit, offering some cost predictability. Without more data on the specific services rendered and their market rates, a definitive value-for-money assessment is difficult, but the competitive award process is a positive indicator.

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 bids. This typically leads to a more robust bidding process with multiple offerors vying for the contract. The number of bidders is not specified, but the open competition suggests that the government sought the best possible value by allowing a wide range of potential contractors to participate. This process is designed to foster price discovery and ensure that the government receives competitive pricing.

Taxpayer Impact: Taxpayers benefit from full and open competition through potentially lower prices due to market forces and a wider selection of qualified contractors, leading to better overall value for public funds.

Public Impact

The primary beneficiaries are likely U.S. Special Operations Command (SOCOM) personnel who will receive essential support services. The services delivered are broadly categorized under 'All Other Support Services,' implying a range of operational or administrative assistance. The contract's performance is geographically located in Kentucky (ST/SN), suggesting a focus on operations or facilities within that state. The contract may indirectly support a workforce through Lockheed Martin's employment of personnel to fulfill the contract requirements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific performance metrics makes it difficult to assess the quality and effectiveness of services rendered.
The CPFF contract type can sometimes lead to cost overruns if not managed diligently by the government.
The broad 'All Other Support Services' category lacks transparency regarding the exact nature of the work performed.
No indication of small business participation or subcontracting opportunities.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
Contract awarded to a large, established defense contractor (Lockheed Martin) known for its capabilities.
The fixed fee component in the CPFF contract provides a degree of cost certainty for the government.
The contract duration of one year allows for focused execution and evaluation.

Sector Analysis

The 'All Other Support Services' category (NAICS 561990) is broad and encompasses a wide array of non-professional, non-technical support activities. This contract falls within the broader professional, scientific, and technical services sector, which is a significant area of federal spending. The Department of Defense, and specifically SOCOM, frequently procures such support services to maintain operational readiness and facilitate mission execution. Comparable spending benchmarks are difficult to establish due to the generic nature of the NAICS code, but the overall market for support services to government agencies is substantial.

Small Business Impact

This contract does not appear to have been awarded as a small business set-aside, as indicated by the 'sb' field being false. There is no information provided regarding subcontracting plans or goals for small businesses. Consequently, the direct impact on the small business ecosystem from this specific award is likely minimal, unless Lockheed Martin voluntarily includes small businesses in its subcontracting efforts.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the U.S. Special Operations Command contracting office and potentially the Department of Defense's Inspector General. Accountability measures would be embedded in the contract's terms and conditions, including performance standards and reporting requirements. Transparency is facilitated by the contract award being publicly available, but detailed operational specifics are often classified or sensitive, limiting full public transparency.

Related Government Programs

Department of Defense Support Services
Special Operations Command Contracts
Logistics and Administrative Support
Professional and Technical Services

Risk Flags

Broad NAICS code limits specificity of services.
CPFF contract type requires diligent oversight to manage costs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $9.6 million to LOCKHEED MARTIN CORPORATION. TAPO MROI FY22-23

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 $9.6 million.

What is the period of performance?

Start: 2022-07-18. End: 2023-07-17.

What is the specific nature of the 'All Other Support Services' provided under this contract?

The provided data classifies this contract under NAICS code 561990, 'All Other Support Services.' This is a broad category that can encompass a wide range of activities not specified elsewhere, such as facilities support, operational assistance, administrative services, or specialized non-technical support. Without further details from the contract award documentation or performance reports, the precise services rendered remain unspecified. This lack of specificity is common for broad support service contracts but makes detailed analysis of value and performance challenging.

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 often used when the scope of work is not precisely defined or when there is uncertainty about the costs involved. It reimburses the contractor for allowable costs plus a fixed fee representing profit. Compared to Firm-Fixed-Price (FFP) contracts, CPFF can offer more flexibility but may lead to higher overall costs if not managed carefully, as the government bears more cost risk. However, for complex or evolving support services, CPFF can be advantageous in ensuring the required services are obtained. The fixed fee provides a ceiling on profit, which is a key control mechanism.

What is Lockheed Martin's track record with similar support service contracts for the Department of Defense?

Lockheed Martin Corporation is a major defense contractor with extensive experience across various service domains for the Department of Defense. While specific data on their performance for contracts under NAICS 561990 is not detailed here, the company consistently secures large contracts for a wide array of services, including logistics, maintenance, IT, and operational support. Their long history and significant presence in the defense sector suggest a substantial track record. Performance evaluations for specific contracts would be necessary for a detailed assessment, but their status as a prime contractor indicates a generally accepted capability to perform.

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

Historical spending trends for 'All Other Support Services' (NAICS 561990) by the U.S. Special Operations Command (SOCOM) would require a comprehensive analysis of federal procurement databases over multiple fiscal years. SOCOM, like other military branches, relies on a variety of support services to maintain operational effectiveness. Spending in this category can fluctuate based on specific mission requirements, operational tempo, and strategic priorities. Without access to detailed historical data specific to SOCOM and this NAICS code, it is difficult to establish a precise trend. However, it is reasonable to assume consistent, albeit variable, expenditure in this area given the nature of SOCOM's operations.

Are there any identified risks associated with this specific contract award or the contractor?

The provided data does not highlight any specific risks associated with this contract award or Lockheed Martin Corporation. However, general risks associated with CPFF contracts include potential cost overruns if not closely monitored. The broad nature of 'All Other Support Services' can also present a risk if the scope of work is not clearly defined and managed, potentially leading to disputes or unmet expectations. For any large contractor, risks can also include performance issues on specific tasks, though Lockheed Martin's established reputation suggests a generally low risk profile for core capabilities.

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: $9,620,996

Exercised Options: $9,620,996

Current Obligation: $9,620,996

Subaward Activity

Number of Subawards: 11

Total Subaward Amount: $73,688

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