DoD Awards BAE Systems $60.5M for Logistics Engineering Amidst Limited Competition

Contract Overview

Contract Amount: $60,454,637 ($60.5M)

Contractor: BAE Systems Technology Solutions & Services Inc.

Awarding Agency: Department of Defense

Start Date: 2023-10-01

End Date: 2027-09-30

Contract Duration: 1,460 days

Daily Burn Rate: $41.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: LOGISTICS ENGINEERING & INTEGRATION

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $60.5 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. for work described as: LOGISTICS ENGINEERING & INTEGRATION Key points: 1. Significant contract value of $60.5 million awarded to a single vendor. 2. Limited competition raises questions about potential price inflation and value. 3. The contract spans four years, indicating a long-term need for these services. 4. Engineering services sector sees substantial investment, with potential for broader application.

Value Assessment

Rating: questionable

The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed tightly. Without competitive bidding, it's difficult to assess if the fixed fee represents a fair market price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was 'NOT COMPETED,' indicating a sole-source or limited competition scenario. This significantly restricts price discovery and may result in higher costs for taxpayers.

Taxpayer Impact: The lack of competition suggests taxpayers may be paying a premium for these logistics engineering and integration services.

Public Impact

Taxpayers may be overpaying due to the absence of competitive bidding. The long-term nature of the contract locks in a single provider for critical logistics support. Potential for reduced innovation as there is no market pressure to improve services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Cost-plus contract type
Long contract duration

Positive Signals

Clear need for logistics engineering services
Established vendor with potential expertise

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330). Spending in this area is crucial for government operations, but competitive bidding is vital to ensure cost-effectiveness.

Small Business Impact

The contract data indicates no specific set-aside for small businesses, suggesting large prime contractors are likely involved in fulfilling the requirements.

Oversight & Accountability

The 'NOT COMPETED' status warrants further oversight to ensure the justification for limited competition is sound and that the pricing is reasonable.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Lack of competition
Cost-plus contract type
Potential for cost overruns
Limited transparency in pricing
No small business participation noted

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $60.5 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC.. LOGISTICS ENGINEERING & INTEGRATION

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $60.5 million.

What is the period of performance?

Start: 2023-10-01. End: 2027-09-30.

What is the justification for not competing this contract, and what steps are being taken to ensure fair pricing?

The justification for not competing this contract is not provided in the data. To ensure fair pricing, the agency should conduct a thorough price analysis of the proposed costs and the fixed fee, comparing them to historical data or industry benchmarks for similar services. Regular audits and performance reviews are also essential.

What are the potential risks associated with a sole-source contract for logistics engineering services?

The primary risks include inflated costs due to lack of competition, potential for vendor complacency leading to suboptimal service quality, and missed opportunities for innovation that could arise from a competitive environment. There's also a risk of vendor lock-in, making it difficult and costly to switch providers later.

How does the Cost Plus Fixed Fee structure impact the overall value and effectiveness of this contract?

The Cost Plus Fixed Fee structure aims to control costs by adding a predetermined fixed fee to allowable costs. However, it can incentivize the contractor to increase costs to maximize profit if oversight is weak. Effectiveness hinges on robust government oversight to manage costs and ensure performance standards are met.

Industry Classification

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

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0003024R6007

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Ball Corporation

Address: 520 GAITHER RD, ROCKVILLE, MD, 20850

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

Financial Breakdown

Contract Ceiling: $104,444,506

Exercised Options: $76,898,370

Current Obligation: $60,454,637

Subaward Activity

Number of Subawards: 27

Total Subaward Amount: $2,242,844

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline