DoD's $9.8M logistics support contract for Repair of Repairables program awarded to Vectrus Systems LLC

Contract Overview

Contract Amount: $9,858,215 ($9.9M)

Contractor: Vectrus Systems LLC

Awarding Agency: Department of Defense

Start Date: 2006-10-01

End Date: 2012-07-31

Contract Duration: 2,130 days

Daily Burn Rate: $4.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: LOGISTICS SUPPORT TO MAINTAIN PORTIONS OF THE REPAIR OF REPAIRABLES (ROR) PRGM

Place of Performance

Location: PATUXENT RIVER, ST. MARY'S County, MARYLAND, 20670

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $9.9 million to VECTRUS SYSTEMS LLC for work described as: LOGISTICS SUPPORT TO MAINTAIN PORTIONS OF THE REPAIR OF REPAIRABLES (ROR) PRGM Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of 2130 days (approx. 5.8 years) indicates a long-term need for these services. 3. The Cost Plus Fixed Fee (CPFF) contract type may incentivize cost control by the contractor. 4. The contract was awarded to a single bidder, which warrants further investigation into the competition dynamics. 5. The absence of small business set-aside flags suggests this was not specifically targeted for small business participation. 6. The contract falls under Engineering Services (NAICS 541330), a sector often requiring specialized expertise.

Value Assessment

Rating: fair

Benchmarking the value of this $9.8 million contract is challenging without specific performance metrics or comparable contract data. The CPFF structure can sometimes lead to higher costs if not managed tightly, but the fixed fee component aims to provide some cost predictability. The fact that only one bid was received under full and open competition raises questions about the attractiveness of the opportunity or the effectiveness of the solicitation process in drawing multiple qualified bidders.

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 bids. However, the data shows only one bid was received. This could suggest that the market for this specific service is limited, the solicitation was highly specialized, or there were barriers to entry for other potential bidders. A single bid in a full and open competition scenario can reduce price discovery and potentially lead to less competitive pricing.

Taxpayer Impact: Taxpayers may not have received the full benefit of competitive pricing due to the limited number of bids submitted. This could mean the government paid more than it might have if multiple companies had vied for the contract.

Public Impact

The primary beneficiaries are the Department of the Navy and the broader Department of Defense, ensuring the continued operation of the Repair of Repairables program. Services delivered include logistics support crucial for maintaining and repairing critical assets within the ROR program. The geographic impact is likely concentrated around naval repair facilities and associated logistics hubs, primarily in Maryland. Workforce implications include employment for personnel skilled in logistics, supply chain management, and potentially technical repair oversight.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (one bid) in a full and open solicitation raises concerns about potential price inflation and reduced incentive for cost efficiency.
The CPFF contract type, while common, requires diligent oversight to ensure costs remain reasonable and the fixed fee is justified.
Lack of specific performance metrics in the provided data makes it difficult to assess the true value for money delivered.

Positive Signals

Awarded through full and open competition, theoretically allowing for broad market participation.
The contract duration suggests a stable, long-term requirement, providing continuity for essential logistics support.
Vectrus Systems LLC's experience in government contracting may bring established processes and expertise to the program.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), which encompasses firms providing specialized engineering expertise. The logistics support for a repair program like ROR is a critical component of defense readiness, ensuring that repairable assets are efficiently managed and maintained. The market for such services is often characterized by a mix of large defense contractors and specialized service providers. Comparable spending benchmarks would typically involve analyzing other logistics support contracts for similar defense programs, considering factors like contract type, duration, and scope of work.

Small Business Impact

The data indicates that this contract was not awarded as a small business set-aside, nor does it explicitly mention subcontracting goals for small businesses. This suggests that the primary focus was on fulfilling the requirement through the most capable bidder, rather than specifically promoting small business participation. Consequently, the direct impact on the small business ecosystem may be limited unless Vectrus Systems LLC voluntarily engages small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures would be tied to the terms and conditions of the Cost Plus Fixed Fee contract, including reporting requirements and performance standards. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Logistics Support Contracts
Navy Repair and Maintenance Programs
Repair of Repairables (ROR) Program
Engineering Services Contracts
Cost Plus Fixed Fee Contracts

Risk Flags

Single Bidder in Full and Open Competition
Potential for Cost Overruns in CPFF Contract
Lack of Detailed Performance Metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $9.9 million to VECTRUS SYSTEMS LLC. LOGISTICS SUPPORT TO MAINTAIN PORTIONS OF THE REPAIR OF REPAIRABLES (ROR) PRGM

Who is the contractor on this award?

The obligated recipient is VECTRUS SYSTEMS LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $9.9 million.

What is the period of performance?

Start: 2006-10-01. End: 2012-07-31.

What is Vectrus Systems LLC's track record with similar Department of Defense logistics contracts?

Vectrus Systems LLC has a significant history of performing logistics and base operations support contracts for the Department of Defense. Their portfolio includes extensive work in areas such as supply chain management, maintenance, transportation, and facilities management across various military branches. Analyzing their past performance on contracts with similar scope, duration, and contract types (like CPFF) would provide insight into their capability to execute this specific ROR program logistics support. Past performance evaluations and any documented issues or successes on prior contracts would be crucial for a comprehensive assessment of their reliability and effectiveness in fulfilling this requirement.

How does the $9.8 million value compare to similar logistics support contracts for defense repair programs?

Comparing the $9.8 million value requires identifying comparable contracts based on scope, duration, and the specific defense repair program supported. Logistics support for programs like 'Repair of Repairables' can vary significantly based on the complexity of the items being repaired, the volume of throughput, and the geographic locations served. Without specific details on the ROR program's scale and the exact services provided under this contract, a direct comparison is difficult. However, contracts of this magnitude (around $1.6 million per year over its 5.8-year duration) are typical for specialized, long-term support functions within the DoD, especially when involving complex supply chains and maintenance oversight.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for logistics support?

The primary risk with a CPFF contract is that the contractor may have less incentive to control costs compared to fixed-price contracts, as costs are reimbursed. However, the 'fixed fee' component provides a defined profit margin, which can incentivize efficiency to some extent. The government bears the risk of cost overruns beyond the estimated cost, although the fee remains fixed. Effective oversight, detailed cost tracking, and clear performance metrics are crucial to mitigate these risks and ensure the government receives good value. For logistics support, risks could include inefficient resource allocation, unexpected supply chain disruptions, or delays in repair processes impacting overall program costs.

How effective is the 'Full and Open Competition' strategy when only one bid is received?

When 'Full and Open Competition' results in only one bid, its effectiveness in achieving competitive pricing and maximizing value for taxpayers is significantly diminished. While the process itself is designed to encourage broad participation, a single bid suggests potential issues such as a lack of market interest, overly restrictive requirements, insufficient notice, or a highly specialized niche market where only one firm possesses the necessary qualifications. In such cases, the government may not benefit from the price discovery and innovation that typically arise from multiple competing proposals. This outcome warrants a review of the solicitation strategy and market research to understand why more bids were not submitted.

What is the historical spending trend for logistics support within the Department of the Navy's repair programs?

Historical spending on logistics support for Department of the Navy repair programs is substantial and generally trends upwards due to increasing complexity of systems, aging fleets, and evolving operational demands. Programs like 'Repair of Repairables' are critical for maintaining readiness and involve significant investments in supply chain management, warehousing, transportation, and technical support services. Analyzing past budgets and contract awards for similar functions within the Navy would reveal patterns of spending, identify key contractors, and highlight the long-term financial commitment required for sustaining these essential support operations. Fluctuations may occur based on defense budgets, strategic priorities, and specific program needs.

What are the implications of the contract's duration (2130 days) on program stability and cost?

A contract duration of 2130 days (approximately 5.8 years) provides significant program stability and continuity for the logistics support of the ROR program. This long-term commitment allows the contractor, Vectrus Systems LLC, to invest in resources, personnel, and processes, potentially leading to greater efficiency and expertise over time. From a cost perspective, longer-term contracts can sometimes offer better value through economies of scale and reduced administrative overhead associated with frequent re-competition. However, it also locks the government into a specific provider for an extended period, potentially limiting flexibility if market conditions or program requirements change significantly.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002406R3570

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: WC Holding Inc. (UEI: 013567606)

Address: 2800 EISENHOWER AVENUE,, ALEXANDRIA, VA, 08

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $69,437,743

Exercised Options: $23,205,310

Current Obligation: $9,858,215

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4123

IDV Type: IDC

Timeline