DoD's $91M Civil Reserve Air Fleet contract awarded to Patriot Team for air transportation services

Contract Overview

Contract Amount: $91,192,014 ($91.2M)

Contractor: Patriot Team

Awarding Agency: Department of Defense

Start Date: 2020-10-01

End Date: 2021-09-30

Contract Duration: 364 days

Daily Burn Rate: $250.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 9

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: CIVIL RESERVE AIR FLEET - AIR TRANSPORTATION SERVICES

Place of Performance

Location: SCOTT AFB, SAINT CLAIR County, ILLINOIS, 62225

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $91.2 million to PATRIOT TEAM for work described as: CIVIL RESERVE AIR FLEET - AIR TRANSPORTATION SERVICES Key points: 1. Contract value represents a significant investment in strategic airlift capabilities. 2. Competition was full and open after exclusion of sources, suggesting a deliberate procurement strategy. 3. Fixed-price with economic price adjustment contract type introduces some cost fluctuation risk. 4. Performance period of one year indicates a focus on immediate operational needs. 5. The contract supports the Department of Defense's ability to mobilize assets during national emergencies. 6. Geographic focus on Illinois suggests a specific operational hub or base of operations.

Value Assessment

Rating: good

The contract value of $91.2 million for one year of air transportation services appears reasonable given the strategic nature of the Civil Reserve Air Fleet. Benchmarking against similar large-scale transportation contracts is challenging due to the unique requirements of military readiness. However, the fixed-price with economic price adjustment structure aims to balance cost control with market volatility, which is a common approach for long-term service agreements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while competition was sought, certain sources were intentionally excluded. This suggests a specific set of criteria or pre-qualification requirements that narrowed the field. With 9 bidders, the competition level was moderate, likely leading to a reasonably competitive price discovery process, though not as broad as a pure full and open competition.

Taxpayer Impact: The exclusion of certain sources may limit the absolute lowest price achievable, but the presence of 9 bidders still provides a degree of taxpayer protection through competitive pressure.

Public Impact

The primary beneficiaries are the U.S. Department of Defense and its personnel, ensuring rapid deployment capabilities. Services delivered include nonscheduled chartered passenger air transportation, crucial for moving personnel during emergencies or exercises. The geographic impact is centered around Illinois, likely supporting specific military installations or strategic staging areas within the state. Workforce implications include support for pilots, aircrews, and ground support personnel within the contracting company and potentially related industries.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the economic price adjustment clause in a volatile market.
Dependence on a limited pool of qualified bidders due to source exclusion criteria.
Risk of service disruption if key personnel or assets become unavailable.
Ensuring consistent service quality across all chartered flights.

Positive Signals

Contract supports a critical national security function (Civil Reserve Air Fleet).
Moderate competition among 9 bidders suggests a reasonably competitive environment.
Fixed-price element provides a baseline cost control measure.
Clear performance period (one year) allows for focused management and evaluation.

Sector Analysis

The air transportation sector is vital for both commercial and governmental operations. For the government, particularly the Department of Defense, strategic airlift capabilities are paramount for national security. This contract falls within the broader category of logistics and transportation services, a significant segment of federal spending. Comparable spending benchmarks are difficult to pinpoint precisely due to the specialized nature of military charter services, but overall federal spending on transportation and logistics runs into billions annually.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses, and the prime contractor, Patriot Team, is not explicitly identified as a small business in this context. There is no direct information on subcontracting plans for small businesses within this award. Therefore, the direct impact on the small business ecosystem from this specific prime contract appears limited, though the overall value chain might involve smaller suppliers.

Oversight & Accountability

Oversight for this contract would primarily fall under the U.S. Transportation Command (USTRANSCOM), the contracting agency. Accountability measures are embedded in the fixed-price with economic price adjustment terms and performance requirements. Transparency is facilitated through contract award databases, though specific operational details may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Sealift Command (MSC) Contracts
Air Mobility Command (AMC) Contracts
Logistics and Transportation Services
Strategic Airlift Capabilities
National Defense Contracts

Risk Flags

Economic Price Adjustment Clause Risk
Limited Competition Pool
Dependence on Commercial Aviation Market Fluctuations

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $91.2 million to PATRIOT TEAM. CIVIL RESERVE AIR FLEET - AIR TRANSPORTATION SERVICES

Who is the contractor on this award?

The obligated recipient is PATRIOT TEAM.

Which agency awarded this contract?

Awarding agency: Department of Defense (USTRANSCOM).

What is the total obligated amount?

The obligated amount is $91.2 million.

What is the period of performance?

Start: 2020-10-01. End: 2021-09-30.

What is the historical spending pattern for the Civil Reserve Air Fleet program under USTRANSCOM?

Historical spending for the Civil Reserve Air Fleet (CRAF) program, particularly under USTRANSCOM, can fluctuate significantly based on global geopolitical conditions, training requirements, and the activation status of the fleet. While specific year-over-year dollar amounts for CRAF contracts are not provided in this dataset, the program is designed to augment the Air Mobility Command (AMC) during national emergencies. This involves agreements with commercial air carriers to provide aircraft and aircrews when needed. Annual outlays can range from tens of millions to hundreds of millions of dollars, depending on the level of readiness maintained and the number of active agreements. The $91.2 million awarded in this instance for FY2021 represents a substantial, but not unprecedented, investment in maintaining this critical strategic asset.

How does the 'Full and Open Competition After Exclusion of Sources' procurement method impact cost-effectiveness compared to traditional full and open competition?

The 'Full and Open Competition After Exclusion of Sources' (FOUC AES) method is a hybrid approach. Traditional full and open competition aims to solicit offers from all responsible sources. FOUC AES, however, starts with a broader solicitation but then excludes specific sources based on pre-defined criteria, which could relate to security, capability, past performance, or specific technological requirements. While it still involves competition, the exclusion of certain potential bidders can limit the breadth of market participation. This might result in fewer offers than a pure full and open competition, potentially leading to a higher price than the absolute lowest achievable. However, it ensures that the competition is focused on a pool of highly qualified or suitable vendors, which can be advantageous for complex or specialized procurements where specific capabilities are paramount, potentially leading to better overall value and reduced risk.

What are the primary risks associated with a 'Fixed Price with Economic Price Adjustment' (FPEPA) contract type for air transportation services?

The primary risks associated with a Fixed Price with Economic Price Adjustment (FPEPA) contract for air transportation services revolve around cost volatility and contractor profitability. While the fixed-price component provides a baseline cost, the economic price adjustment (EPA) allows for modifications based on fluctuations in specific economic factors, such as fuel prices, labor costs, or material indices. The main risk for the government is potential cost increases if these economic factors rise significantly, exceeding initial projections. Conversely, the contractor faces the risk of reduced profit margins if the EPA formula does not fully compensate for escalating costs or if costs decrease and the adjustment formula doesn't capture that reduction effectively. For this specific contract, the volatility of aviation fuel prices is a key factor that the EPA would likely aim to address, introducing a degree of uncertainty in the final expenditure.

What is the typical role and importance of the Civil Reserve Air Fleet (CRAF) in U.S. national defense strategy?

The Civil Reserve Air Fleet (CRAF) is a critical component of U.S. national defense strategy, providing a vital augmentation resource for the Department of Defense's (DoD) air mobility capabilities during national emergencies. Its primary role is to supplement the Air Mobility Command (AMC) fleet when the demand for airlift exceeds the DoD's organic capacity. This includes scenarios such as large-scale personnel or equipment deployment during wartime, humanitarian relief operations, or other major contingencies. CRAF consists of commercial airliners and cargo aircraft that are voluntarily enrolled by their owners. In return for a standby agreement and readiness commitments, participating carriers receive certain benefits, including preference for government freight and passenger business during peacetime. The importance of CRAF lies in its ability to rapidly expand the nation's strategic airlift capacity without the immense cost of maintaining a permanently larger military fleet.

How does the geographic location (Illinois) influence the operational context of this air transportation contract?

The specified geographic location of Illinois for this air transportation contract likely influences its operational context by indicating a primary base of operations, a key staging area, or a region with significant military installations relevant to U.S. Transportation Command (USTRANSCOM) needs. Illinois is home to Scott Air Force Base, which hosts USTRANSCOM headquarters and is a major hub for air mobility operations. Therefore, contracts associated with this region often support the strategic deployment and logistical functions managed by USTRANSCOM. The presence of a major military air command center in Illinois suggests that this contract could be directly involved in facilitating troop movements, equipment transfers, or logistical support originating from or destined for the Midwest, or supporting the command and control functions of USTRANSCOM itself.

Industry Classification

NAICS: Transportation and Warehousing › Nonscheduled Air Transportation › Nonscheduled Chartered Passenger Air Transportation

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 9

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 3303 N SHERIDAN RD, TULSA, OK, 74115

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

Financial Breakdown

Contract Ceiling: $91,192,014

Exercised Options: $91,192,014

Current Obligation: $91,192,014

Actual Outlays: $83,141,767

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HTC71118DCC39

IDV Type: IDC

Timeline