DoD's Northrop Grumman Contract for UK ULS Support Exceeds $112M, Lacking Competition
Contract Overview
Contract Amount: $112,107,257 ($112.1M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2011-12-05
End Date: 2023-09-30
Contract Duration: 4,317 days
Daily Burn Rate: $26.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Other
Official Description: FY12 UK ULS SUPPORT (CPFF - LOE)
Place of Performance
Location: SUNNYVALE, SANTA CLARA County, CALIFORNIA, 94086
Plain-Language Summary
Department of Defense obligated $112.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: FY12 UK ULS SUPPORT (CPFF - LOE) Key points: 1. Significant spending on a long-duration support contract. 2. Sole-source award raises concerns about price discovery. 3. Engineering services sector sees substantial government investment. 4. Potential for cost overruns given the CPFF structure.
Value Assessment
Rating: questionable
The contract's Cost Plus Incentive Fee (CPIF) structure, combined with a lack of competition, makes it difficult to benchmark pricing effectively. The total award value is substantial, and without competitive bids, it's hard to ascertain if taxpayers received the best possible value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This significantly limits price discovery and negotiation leverage for the government, potentially leading to higher costs than if multiple vendors had competed.
Taxpayer Impact: The lack of competition on this large contract likely results in higher costs for taxpayers, as there was no market pressure to drive down prices.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. Long contract duration (over 12 years) increases the risk of cost escalation. Lack of transparency in pricing due to sole-source nature.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- High total contract value
- Long contract duration
- Cost-plus contract type
Positive Signals
- Contract supports critical UK operations
- Experienced contractor
- Defined contract award type
Sector Analysis
This contract falls within the Engineering Services sector, which often involves complex, specialized work. Government spending in this area is significant, but competitive bidding is crucial to ensure cost-effectiveness for specialized services.
Small Business Impact
The data indicates this contract was awarded to Northrop Grumman Systems Corporation, a large business. There is no indication of small business participation in this specific award, which is common for large, sole-source contracts.
Oversight & Accountability
The sole-source nature of this contract warrants close oversight to ensure costs are reasonable and performance meets requirements. Regular reviews of contractor expenditures and progress are essential for accountability.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition
- High contract value
- Long contract duration
- Cost-plus contract type
- Potential for cost overruns
- Limited transparency
Tags
engineering-services, department-of-defense, ca, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $112.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. FY12 UK ULS SUPPORT (CPFF - LOE)
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $112.1 million.
What is the period of performance?
Start: 2011-12-05. End: 2023-09-30.
What specific services are included under 'UK ULS SUPPORT' and how are they critical to national security?
The contract details are limited, but 'UK ULS SUPPORT' likely refers to logistical or operational support services for United Kingdom-based United Launch Services (ULS) or similar critical infrastructure. Understanding the precise nature of these services is key to assessing their criticality and justifying the significant expenditure, especially given the sole-source award.
Given the sole-source award and CPIF structure, what mechanisms are in place to control costs and prevent overruns?
While the CPIF structure includes incentives, the absence of competition inherently weakens cost control. Oversight should focus on rigorous auditing of Northrop Grumman's costs, strict adherence to performance metrics, and clear justification for any cost increases. Independent cost analysis may be necessary to validate expenditures.
How does the government ensure effective performance and value for money on long-term, sole-source contracts like this one?
Effective performance and value on long-term sole-source contracts rely heavily on robust government oversight, clear performance metrics, and strong contract management. Regular performance reviews, audits, and potentially independent technical assessments are crucial. The government must actively manage the relationship and ensure the contractor is meeting all obligations.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 401 E HENDY AVE MS 33-3, SUNNYVALE, CA, 94086
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $128,980,122
Exercised Options: $113,145,625
Current Obligation: $112,107,257
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2011-12-05
Current End Date: 2023-09-30
Potential End Date: 2023-09-30 00:00:00
Last Modified: 2022-08-23
More Contracts from Northrop Grumman Systems Corporation
- 200506!000026!5700!fa8214!oo-Alc/Pkme/Lmke !F4261098C0001 !A!N! !Y! !p01502!20041213!20050701!001563738!004179453!016435559!n!northrop Grumman Space & Missi!888 S 2000 E !clearfield !ut!84015!13850!011!49!clearfield !davis !utah !-000001960000!n!n!000000000000!l014!tech REP Svcs/Guided Missiles !A2 !missile and Space Systems !302 !minuteman III GRP !541330!E! !3! ! !C! ! !20200930!B! ! !A! !a!n!l!2!002!b! !Z!Y!Z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! ! — $10.0B (Department of Defense)
- E-2D Advanced Hawkeye Aircraft (FRP-7) — $8.5B (Department of Defense)
- E-2D Advanced Hawkeye Aircraft (FRP-2) — $5.4B (Department of Defense)
- First DDT and E, Ares I-X, and Flight Tests. First Stage Will BE a Five Segment, Solid Rocket Booster Derived From the Space Shuttle Program (SSP) Solid Rocket Booster (srb)/Reusable Solid Rocket Motor (rsrm). the Contractor Shall Furnish the Necessary Management, Engineering, Labor, Facilities, Tools, Equipment, and Materials Required for First Stage Development, Qualification, Certification and Acceptance Program. Activities Include: Redesign and Testing of the Motor to Incorporate the Fifth Segment and Production of Five Full Scale Ground Static Test Motors: TWO Development Motors (dms)-And Three Qualification Motors (QMS); Structural Test Article (STA), Ground Vibration Test Motors (gvtms) and Other Development Testing; Redesign of the Avionics, Deceleration, Separation, and Flight Termination System (FTS) Subsystems; Ares I-X: Simulated Ares I Outer Mold Line/Mass Properties Using Modified Srb/Rsrm; and Three Flight Test Vehicles. TAS::80 0124::TAS — $4.4B (National Aeronautics and Space Administration)
- Federal Contract — $4.4B (Department of Defense)
View all Northrop Grumman Systems Corporation federal contracts →
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)