DoD Awards $81M for MV-22 Aircraft Retrofit, Sole-Source Contract Raises Concerns
Contract Overview
Contract Amount: $80,953,507 ($81.0M)
Contractor: Bell Boeing Joint Project Office
Awarding Agency: Department of Defense
Start Date: 2007-08-28
End Date: 2014-06-30
Contract Duration: 2,498 days
Daily Burn Rate: $32.4K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: NON RECURRING ENGINEERING (NRE) ISO MV-22 AIRCRAFT 41-49 BLOCK B RETROFIT
Place of Performance
Location: AMARILLO, POTTER County, TEXAS, 79111
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $81.0 million to BELL BOEING JOINT PROJECT OFFICE for work described as: NON RECURRING ENGINEERING (NRE) ISO MV-22 AIRCRAFT 41-49 BLOCK B RETROFIT Key points: 1. Significant investment in aircraft modernization. 2. Sole-source award limits competitive pricing. 3. Potential for cost overruns due to fixed-price incentive contract. 4. Focus on defense sector, specifically aircraft manufacturing.
Value Assessment
Rating: questionable
The $81 million contract for NRE ISO MV-22 aircraft retrofit is a substantial investment. Without competitive bidding, it's difficult to assess if the pricing is optimal compared to similar retrofits or market rates.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This significantly limits price discovery and potentially leads to higher costs for taxpayers as there is no competitive pressure to drive down prices.
Taxpayer Impact: The lack of competition in this sole-source award means taxpayers may be paying a premium for the MV-22 aircraft retrofits.
Public Impact
Modernization of critical military aircraft ensures operational readiness. Sole-source procurement can impact the defense industrial base by not fostering competition. Fixed-price incentive contracts aim to balance cost control with performance incentives.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Fixed-price incentive contract
- Long performance period (2498 days)
Positive Signals
- Essential aircraft modernization
- Supports defense capabilities
Sector Analysis
This contract falls within the Aircraft Manufacturing sector, a critical component of the defense industry. Spending benchmarks for NRE and retrofits can vary widely based on aircraft type and complexity.
Small Business Impact
The data does not indicate any specific involvement or benefit for small businesses in this contract.
Oversight & Accountability
The Department of Defense, through the Defense Contract Management Agency, is responsible for overseeing this contract. Accountability for cost and performance will be crucial given the sole-source nature.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Long contract duration
- Sole-source justification requires scrutiny
Tags
aircraft-manufacturing, department-of-defense, tx, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $81.0 million to BELL BOEING JOINT PROJECT OFFICE. NON RECURRING ENGINEERING (NRE) ISO MV-22 AIRCRAFT 41-49 BLOCK B RETROFIT
Who is the contractor on this award?
The obligated recipient is BELL BOEING JOINT PROJECT OFFICE.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $81.0 million.
What is the period of performance?
Start: 2007-08-28. End: 2014-06-30.
What was the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or a lack of viable alternative sources. For the MV-22, specific modifications or integration requirements might necessitate a single provider, but this needs rigorous justification to ensure fair pricing and avoid unnecessary costs.
What are the potential risks associated with a fixed-price incentive contract for this type of retrofit?
Fixed-price incentive contracts aim to share cost risks between the government and contractor. However, for complex retrofits like this, there's a risk that cost overruns could still occur, leading to higher final prices if targets are missed. The contractor has an incentive to control costs, but the government bears the risk if costs exceed projections.
How will the effectiveness of this retrofit be measured to ensure value for taxpayer money?
Effectiveness will likely be measured through performance metrics related to the MV-22's operational capabilities, reliability, and safety post-retrofit. The Defense Contract Management Agency will monitor adherence to specifications and the achievement of desired performance improvements, ensuring the investment translates into enhanced military readiness.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Address: 401 TILTROTOR DR, AMARILLO, TX, 79111
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $86,039,888
Exercised Options: $86,039,888
Current Obligation: $80,953,507
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2007-08-28
Current End Date: 2014-06-30
Potential End Date: 2014-06-30 00:00:00
Last Modified: 2020-09-02
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