Navy Awards $174.7M for Systems Engineering Services to Litton Shipbuilding for DDG-51 Destroyers

Contract Overview

Contract Amount: $89,341,675 ($89.3M)

Contractor: Huntington Ingalls Incorporated

Awarding Agency: Department of Defense

Start Date: 2000-05-26

End Date: 2005-05-26

Contract Duration: 1,826 days

Daily Burn Rate: $48.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: 200008!1700!002637!BZ002 !NAVAL SEA SYSTEMS COMMAND !N0002400C2302 !A!*!* !20000526!20010526!174786913!174786913!001922749!N!34293!LITTON SHIPBUILDING INC !1000 ACCESS RD !PASCAGOULA !MS!39568!55360!059!28!PASCAGOULA !JACKSON !MISS !0001!+000011968951!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !A3 !SHIPS !2SCY!DESTROYER DDG-51 !3731!3!*!*!*!B!A!*!D !N!R!1!001!N!1G!Z!Y!Z!* !* !N!C!*!A!A!A!A!A!A!* !*!N!A!C!N!*!*!*!*!*!

Place of Performance

Location: PASCAGOULA, JACKSON County, MISSISSIPPI, 39568, UNITED STATES OF AMERICA

State: Mississippi Government Spending

Plain-Language Summary

Department of Defense obligated $89.3 million to HUNTINGTON INGALLS INCORPORATED for work described as: 200008!1700!002637!BZ002 !NAVAL SEA SYSTEMS COMMAND !N0002400C2302 !A!*!* !20000526!20010526!174786913!174786913!001922749!N!34293!LITTON SHIPBUILDING INC !1000 ACCESS RD !PASCAGOULA !MS!39568!55360!059!28!PASCAGOULA !JAC… Key points: 1. Contract awarded for critical systems engineering services for the Arleigh Burke-class destroyer program. 2. Litton Shipbuilding Inc. secured the contract, indicating a significant role in naval shipbuilding support. 3. The contract was not competed, raising questions about potential cost efficiencies and market competition. 4. Spending in the shipbuilding and defense sector often involves complex, long-term contracts with substantial taxpayer investment.

Value Assessment

Rating: questionable

The contract value of $174.7 million over approximately five years suggests a significant investment. Without specific per-unit cost data or comparison to similar engineering service contracts, it's difficult to definitively assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, meaning it was awarded directly to Litton Shipbuilding Inc. This approach can streamline acquisition for specialized needs but may limit price discovery and potentially lead to higher costs compared to a competitive process.

Taxpayer Impact: The lack of competition means taxpayers may not have benefited from the most cost-effective solution available in the market.

Public Impact

Supports the continued operation and modernization of the U.S. Navy's destroyer fleet. Ensures the availability of specialized engineering expertise for complex naval platforms. Impacts the shipbuilding industrial base, particularly in Mississippi, where Litton Shipbuilding is located. Represents a significant allocation of defense funds towards platform sustainment and development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for cost overruns in sole-source contracts
Long-term reliance on a single provider for critical services

Positive Signals

Ensures specialized expertise for a critical naval program
Supports a key defense contractor and associated jobs

Sector Analysis

This contract falls within the defense sector, specifically supporting naval shipbuilding and systems engineering. Spending in this area is characterized by high complexity, long procurement cycles, and significant government oversight due to the strategic importance and cost of military assets.

Small Business Impact

The data does not indicate whether small businesses were involved as subcontractors. The primary awardee, Litton Shipbuilding Inc., is a large entity, suggesting the focus was on established prime contractors for this specialized service.

Oversight & Accountability

The contract was awarded by the Naval Sea Systems Command, part of the Department of the Navy. Oversight would typically involve program managers, contracting officers, and potentially inspectors general to ensure compliance with contract terms and performance standards.

Related Government Programs

Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Lack of competitive bidding may have inflated costs.
Potential for vendor lock-in due to sole-source award.
Long contract duration could mask inefficiencies.
Limited transparency on specific deliverables and performance metrics.
Reliance on a single entity for critical engineering services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $89.3 million to HUNTINGTON INGALLS INCORPORATED. 200008!1700!002637!BZ002 !NAVAL SEA SYSTEMS COMMAND !N0002400C2302 !A!*!* !20000526!20010526!174786913!174786913!001922749!N!34293!LITTON SHIPBUILDING INC !1000 ACCESS RD !PASCAGOULA !MS!39568!55360!059!28!PASCAGOULA !JACKSON !MISS !0001!+000011968951!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !A3 !SHIPS !2SCY!DESTROYER DDG-51 !3731!3!*!*!*!B!A!*!D !N!R!

Who is the contractor on this award?

The obligated recipient is HUNTINGTON INGALLS INCORPORATED.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $89.3 million.

What is the period of performance?

Start: 2000-05-26. End: 2005-05-26.

What specific systems engineering tasks were included in this contract, and how do they directly contribute to the operational readiness and future capabilities of the DDG-51 class destroyers?

The contract likely encompassed a range of activities such as design integration, technical analysis, performance monitoring, and support for modifications or upgrades to the DDG-51 class destroyers. These services are crucial for maintaining the complex combat systems, propulsion, and other integrated platforms, ensuring the vessels remain effective against evolving threats and meet operational requirements throughout their service life.

Given the sole-source nature of this award, what mechanisms were in place to ensure the government received fair and reasonable pricing for these systems engineering services?

In sole-source procurements, agencies typically rely on techniques like cost and price analysis, comparison with historical data, and negotiation with the contractor to establish fair and reasonable pricing. The contracting officer would have likely reviewed the contractor's cost proposals, audited their accounting systems, and potentially engaged in detailed negotiations to justify the final award price.

How does the performance of Litton Shipbuilding Inc. on this contract compare to industry benchmarks for systems engineering services in the defense sector, particularly concerning timeliness and qual

Assessing performance against industry benchmarks requires access to specific performance metrics and quality data from this contract, which is not publicly available. However, the Department of the Navy's past performance evaluations and contract close-out reports would provide internal insights into Litton's adherence to schedule, budget, and technical specifications for this and other contracts.

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: Huntington Ingalls Industries, Inc (UEI: 967362331)

Address: 1000 ACCESS RD, PASCAGOULA, MS, 39567

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

Contract Characteristics

Cost or Pricing Data: YES

Timeline