DoD Awards $17M for Integration and Test to General Atomics, Raising Oversight Concerns

Contract Overview

Contract Amount: $17,006,074 ($17.0M)

Contractor: General Atomics Aeronautical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2023-12-20

End Date: 2026-01-31

Contract Duration: 773 days

Daily Burn Rate: $22.0K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: INTEGRATION AND TEST

Place of Performance

Location: POWAY, SAN DIEGO County, CALIFORNIA, 92064

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $17.0 million to GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC. for work described as: INTEGRATION AND TEST Key points: 1. Significant contract awarded to a single vendor, General Atomics Aeronautical Systems, Inc. 2. The contract is for 'INTEGRATION AND TEST' with a substantial value of $17,006,074.45. 3. Lack of competition raises questions about price discovery and potential taxpayer impact. 4. The sector is 'Other Aircraft Parts and Auxiliary Equipment Manufacturing', suggesting specialized needs.

Value Assessment

Rating: questionable

The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not closely monitored. Without competitive bidding, it's difficult to assess if the $17M price is optimal.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for the government compared to a competitive environment.

Taxpayer Impact: The lack of competition for a $17M contract may result in taxpayers paying a premium for the services rendered.

Public Impact

Special Operations Command procurement raises national security implications. The use of a sole-source contract for a large value award warrants public scrutiny. Potential for increased costs impacts overall defense budget allocation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Cost Plus Fixed Fee contract type
Lack of transparency in price negotiation

Positive Signals

Supports critical U.S. Special Operations Command needs
Contract awarded to established defense contractor

Sector Analysis

The 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector is critical for defense readiness. Spending benchmarks in this niche area are hard to establish without competitive data, but $17M is a significant investment.

Small Business Impact

The contract data does not indicate any specific provisions or set-asides for small businesses. The award to General Atomics Aeronautical Systems, Inc. suggests a focus on large, established prime contractors.

Oversight & Accountability

The sole-source nature of this large contract necessitates robust oversight from the Department of Defense to ensure fair pricing and effective execution. Transparency in the justification for the sole-source award is crucial.

Related Government Programs

Other Aircraft Parts and Auxiliary Equipment Manufacturing
Department of Defense Contracting
U.S. Special Operations Command Programs

Risk Flags

Sole-source award lacks competitive pricing.
Cost Plus Fixed Fee can lead to cost overruns.
Limited transparency on justification for sole-source.
Potential for reduced innovation due to lack of competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.0 million to GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC.. INTEGRATION AND TEST

Who is the contractor on this award?

The obligated recipient is GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC..

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 $17.0 million.

What is the period of performance?

Start: 2023-12-20. End: 2026-01-31.

What is the specific justification for awarding this $17M contract on a sole-source basis, and what steps are being taken to ensure fair pricing?

The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. Robust oversight would involve detailed cost analysis, negotiation with the contractor, and potentially independent cost estimates to validate the fixed fee and overall contract value, ensuring the government receives good value despite the absence of competition.

How does the Cost Plus Fixed Fee structure mitigate risks associated with 'INTEGRATION AND TEST' services, especially in a sole-source scenario?

Cost Plus Fixed Fee (CPFF) contracts aim to control costs by setting a fixed fee for the contractor's profit, independent of the actual costs incurred. However, in a sole-source scenario, the government bears the risk of cost overruns if the initial cost estimates are inaccurate. Effective oversight is crucial to monitor costs and ensure the contractor exercises efficiency.

What is the long-term strategic value of this 'INTEGRATION AND TEST' contract for U.S. Special Operations Command, and how does it align with broader defense objectives?

The 'INTEGRATION AND TEST' services are likely critical for ensuring the functionality and readiness of specialized systems or platforms used by U.S. Special Operations Command. The long-term value lies in maintaining operational effectiveness and technological superiority. Alignment with broader defense objectives would depend on the specific systems being integrated and tested, contributing to overall mission success and national security.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 14200 KIRKHAM WAY, POWAY, CA, 92064

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $17,031,948

Exercised Options: $17,031,948

Current Obligation: $17,006,074

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: H9240318D0006

IDV Type: IDC

Timeline