DoD's $8.6M contract for functioning support awarded to Lockheed Martin amid full and open competition

Contract Overview

Contract Amount: $8,628,901 ($8.6M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2024-02-29

End Date: 2025-02-28

Contract Duration: 365 days

Daily Burn Rate: $23.6K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 2809 GEN FUNCTIONING SPT 160D

Place of Performance

Location: LEXINGTON, FAYETTE County, KENTUCKY, 40516

State: Kentucky Government Spending

Plain-Language Summary

Department of Defense obligated $8.6 million to LOCKHEED MARTIN CORPORATION for work described as: 2809 GEN FUNCTIONING SPT 160D Key points: 1. Contract value represents a modest portion of overall defense spending in support services. 2. Competition dynamics suggest a potentially favorable pricing environment for the government. 3. Performance risk appears manageable given the nature of functioning support services. 4. Contract duration of one year allows for regular performance evaluation. 5. Sector positioning is within the broad defense services category, a significant area of federal expenditure. 6. The award to a major defense contractor indicates established capabilities for complex support.

Value Assessment

Rating: good

The contract value of approximately $8.6 million for one year of functioning support services appears reasonable when benchmarked against similar large-scale defense support contracts. While specific per-unit cost data is not provided, the fixed fee component suggests a degree of cost control. The competitive nature of the award further supports the likelihood of a fair price. However, a deeper dive into the specific deliverables and the contractor's historical performance on similar tasks would provide a more definitive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. The specific number of bidders is not detailed, but this procurement method generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. The agency sought proposals from all responsible sources, maximizing the potential for innovative solutions and cost efficiencies.

Taxpayer Impact: Full and open competition is the most advantageous for taxpayers as it maximizes the chances of securing the best value through a wide range of offers and potentially lower prices due to competitive pressures.

Public Impact

The primary beneficiaries are U.S. Special Operations Command (SOCOM) personnel who will receive essential functioning support services. Services delivered are critical for the operational readiness and effectiveness of special operations forces. The geographic impact is primarily within Kentucky, where the contract is being performed. Workforce implications include potential employment opportunities for individuals with specialized support skills in the Kentucky region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if 'functioning support' is not clearly defined.
Dependence on a single large contractor for critical support functions.
Risk of cost overruns if the fixed-fee structure is not rigorously managed.

Positive Signals

Award to a reputable contractor with extensive experience in defense support.
Competitive bidding process likely secured favorable terms.
Clear contract period allows for performance monitoring and potential adjustments.

Sector Analysis

This contract falls within the broader defense services sector, which encompasses a wide array of support functions essential for military operations. The market for such services is substantial, driven by continuous government demand. Comparable spending benchmarks in this sector often involve multi-year, high-value contracts for logistics, maintenance, and operational support. This specific award, while significant, represents a focused investment within a larger ecosystem of defense contracting.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a specific small business set-aside. While Lockheed Martin is a large prime contractor, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting will depend on the prime contractor's strategy and the specific requirements of the support services. Further analysis would be needed to determine the direct impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the U.S. Special Operations Command contracting office, with potential involvement from the Department of Defense Inspector General for audits and investigations. Accountability measures are typically embedded within the contract terms, including performance metrics and reporting requirements. Transparency is facilitated through contract award databases, though detailed performance data may be restricted.

Related Government Programs

Defense Logistics Agency Support Contracts
Special Operations Forces Support Services
Department of Defense Operational Readiness Contracts
Government Support Services

Risk Flags

Potential for undefined scope in 'functioning support'.
Reliance on a single large contractor.
Need for rigorous performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.6 million to LOCKHEED MARTIN CORPORATION. 2809 GEN FUNCTIONING SPT 160D

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 $8.6 million.

What is the period of performance?

Start: 2024-02-29. End: 2025-02-28.

What is Lockheed Martin's track record with similar functioning support contracts for SOCOM?

Lockheed Martin has a long-standing and extensive track record of providing a wide range of support services to various branches of the U.S. military, including Special Operations Command. Their experience spans complex logistics, maintenance, training, and operational support. While specific details on 'functioning support' contracts for SOCOM are not publicly itemized in this context, the company's overall portfolio suggests a high level of capability and familiarity with the demanding requirements of special operations. Past performance evaluations and contract histories, often available through government databases like FPDS or SAM.gov, would provide more granular insights into their success rates, any past issues, and their ability to meet performance expectations on similar engagements.

How does the $8.6 million contract value compare to historical spending on similar SOCOM support services?

The $8.6 million contract value for one year of functioning support services represents a moderate investment within the broader SOCOM budget. SOCOM's annual spending can reach billions of dollars, encompassing a vast array of operational, personnel, and equipment support. Contracts for specialized support services can range from hundreds of thousands to tens or even hundreds of millions of dollars, depending on scope, duration, and complexity. This particular award appears to be a focused effort for a specific set of support functions. Benchmarking requires identifying contracts with highly similar service descriptions and durations; without that precise match, it's challenging to definitively state if $8.6 million is high or low, but it falls within a common range for specialized, single-year support tasks.

What are the primary risks associated with this 'functioning support' contract, and how are they mitigated?

The primary risks associated with a 'functioning support' contract often revolve around the definition and scope of 'functioning.' Ambiguity can lead to scope creep, where the contractor is asked to perform tasks beyond the original intent, potentially increasing costs and delaying timelines. Another risk is the potential for performance deficiencies if the support provided is inadequate, impacting the operational readiness of SOCOM. Mitigation strategies typically include clearly defined performance work statements (PWS), robust quality assurance surveillance plans (QASP), and regular performance reviews. The contract's fixed-fee structure, combined with performance incentives or penalties, also serves as a risk mitigation tool by aligning the contractor's financial interests with successful service delivery.

What is the expected program effectiveness or outcome from this contract?

The expected program effectiveness from this contract is the seamless and reliable provision of essential functioning support services, thereby enhancing the operational readiness and efficiency of U.S. Special Operations Command. This support is critical for ensuring that SOCOM personnel can focus on their core missions without being hindered by logistical or operational deficiencies. The contract aims to ensure that all necessary systems, equipment, or facilities designated under 'functioning support' operate as intended, meeting defined performance standards. Ultimately, the success of this contract contributes to the overall effectiveness and capability of special operations forces in executing their diverse and often sensitive missions.

What are the historical spending patterns for 'All Other Support Services' (NAICS 561990) by the Department of Defense?

The Department of Defense (DoD) is a significant spender within the 'All Other Support Services' category (NAICS 561990), which encompasses a broad range of non-classified support activities not elsewhere specified. Historical spending patterns reveal a consistent and substantial allocation of funds towards this sector, reflecting the diverse operational and administrative needs of the military. While specific annual totals fluctuate based on strategic priorities and budget allocations, the DoD consistently ranks among the top federal agencies awarding contracts under this NAICS code. This spending supports various functions, including facility maintenance, specialized operational support, and administrative services, often through competitive bidding processes.

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: $8,628,901

Exercised Options: $8,628,901

Current Obligation: $8,628,901

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $538,200

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