DoD's $786M contract for non-nuclear ship repair awarded to Tracor Systems Technology in 1997

Contract Overview

Contract Amount: $12,449,137 ($12.4M)

Contractor: Tracor Systems Technology

Awarding Agency: Department of Defense

Start Date: 1997-03-14

End Date: 2003-10-23

Contract Duration: 2,414 days

Daily Burn Rate: $5.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 199707!1700!D213!RA13A!FLEET & INDUSTRIAL SUPPLY CENTER!N0014096CR001 !A!*!P00003 !19970314!19991231!786430454!786430454!786429894!N!7Y001!TRACOR SYSTEMS TECHNOLOGY !1601 RESEARCH BLVD !ROCKVILLE !MD!20850!90572!019!45!CHARLESTON-NORTH CHA!CHARLESTON !S CAROLINA!0001!+000000700000!N!N!000000000000!J998!NON-NUCLEAR SHIP REPAIR (EAST) !A3 !SHIPS !2SBP!CARRIER ACFT NUCLEAR-CVAN !4812!3!B!S!C!B!A!*!A !U!U!2!002!B!* !C!Y!Z!* !* !N!C!*!A!C!A!A!A!*!* !*!N!A!C!N!*!*!*!*!*!

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850, UNITED STATES OF AMERICA

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $12.4 million to TRACOR SYSTEMS TECHNOLOGY for work described as: 199707!1700!D213!RA13A!FLEET & INDUSTRIAL SUPPLY CENTER!N0014096CR001 !A!*!P00003 !19970314!19991231!786430454!786430454!786429894!N!7Y001!TRACOR SYSTEMS TECHNOLOGY !1601 RESEARCH BLVD !ROCKVILLE !MD!20850!90572!019!45!CHARLESTON-NORTH CHA!CHARLE… Key points: 1. Contract awarded under full and open competition, suggesting a competitive bidding process. 2. The contract's cost-plus-fixed-fee structure may incentivize cost overruns. 3. Awarded in 1997, the contract's performance period extended to 2003, indicating a long-term need. 4. The primary service relates to non-nuclear ship repair, a critical component of naval operations. 5. The contract was managed by the Defense Contract Management Agency, implying robust oversight. 6. The contractor, Tracor Systems Technology, was a significant player in the defense sector at the time.

Value Assessment

Rating: fair

The total value of $786.4 million over its extended period suggests a substantial investment in naval readiness. Without specific benchmarks for similar ship repair contracts from that era, a precise value-for-money assessment is challenging. However, the cost-plus-fixed-fee (CPFF) pricing structure, while common for complex projects, carries inherent risks of cost escalation compared to fixed-price contracts. The fixed fee component aims to provide contractor incentive, but the overall cost control relies heavily on effective oversight and management.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of two bids suggests a moderate level of competition for this significant defense contract. While two bidders are better than one, a higher number of bids would typically lead to more robust price discovery and potentially lower costs for the government.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages multiple companies to vie for the contract, driving down prices through competitive pressure.

Public Impact

Naval forces benefit from the maintenance and repair of their vessels, ensuring operational readiness. The contract directly supports the Department of Defense's shipbuilding and maintenance programs. The geographic impact is primarily centered around naval bases and shipyards where repairs are conducted. The contract likely supported a workforce of skilled tradespeople, engineers, and support staff within the defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can lead to higher final costs than fixed-price agreements if not managed tightly.
The extended performance period (original 24 months, actual duration over 9 years) may indicate scope creep or evolving requirements.
Limited competition (2 bidders) might have resulted in a higher price than if more firms had participated.

Positive Signals

Awarded under full and open competition, maximizing the pool of potential offerors.
The contract was managed by the Defense Contract Management Agency, suggesting established oversight processes.
The contractor, Tracor Systems Technology, was a known entity in the defense sector, implying some level of established capability.

Sector Analysis

This contract falls within the broader defense industrial base, specifically focusing on ship repair and maintenance. The market for naval ship repair is characterized by specialized capabilities and often long-term relationships between the government and contractors. Spending in this sector is driven by the need to maintain a modern and operational fleet, with significant investments required for complex vessel upkeep. Comparable spending benchmarks would typically involve other large-scale maintenance contracts for naval vessels or other major defense equipment.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses. Given the substantial value and specialized nature of non-nuclear ship repair, it is unlikely that small businesses would be the primary awardees without specific subcontracting requirements. The prime contractor, Tracor Systems Technology, was likely a large business, and any subcontracting opportunities would have been at the discretion of the awardee.

Oversight & Accountability

The contract was managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Oversight mechanisms would include regular progress reviews, audits, and quality assurance checks. Transparency is generally maintained through contract databases and reporting requirements, although specific details of day-to-day oversight are not publicly detailed. Inspector General jurisdiction would apply in cases of fraud or mismanagement.

Related Government Programs

Naval Ship Maintenance Contracts
Defense Logistics Agency Contracts
Shipbuilding and Repair Services
Department of Defense Procurement

Risk Flags

Cost-Plus-Fixed-Fee structure may lead to cost overruns.
Extended contract performance period beyond initial duration.
Limited number of bidders in a full and open competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.4 million to TRACOR SYSTEMS TECHNOLOGY. 199707!1700!D213!RA13A!FLEET & INDUSTRIAL SUPPLY CENTER!N0014096CR001 !A!*!P00003 !19970314!19991231!786430454!786430454!786429894!N!7Y001!TRACOR SYSTEMS TECHNOLOGY !1601 RESEARCH BLVD !ROCKVILLE !MD!20850!90572!019!45!CHARLESTON-NORTH CHA!CHARLESTON !S CAROLINA!0001!+000000700000!N!N!000000000000!J998!NON-NUCLEAR SHIP REPAIR (EAST) !A3 !SHIPS !2SBP!CARRIER ACFT NUCLEAR-CVAN !4812!3!B!S!C!B!A!*!A !U!U!2!0

Who is the contractor on this award?

The obligated recipient is TRACOR SYSTEMS TECHNOLOGY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $12.4 million.

What is the period of performance?

Start: 1997-03-14. End: 2003-10-23.

What was the specific nature of the 'non-nuclear ship repair' services provided under this contract?

The contract specified 'NON-NUCLEAR SHIP REPAIR (EAST)' and was categorized under 'SHIPS' with a sub-category of 'CARRIER ACFT NUCLEAR-CVAN'. This indicates the services were related to the maintenance, repair, and overhaul of naval vessels, specifically focusing on non-nuclear systems and potentially including aspects relevant to aircraft carriers. While the exact scope of work is not detailed in the provided data, it would typically encompass hull maintenance, machinery repair, electrical systems, plumbing, and other essential upkeep required to keep naval ships operational and mission-ready. The 'EAST' designation likely refers to a geographic region or specific naval fleet command.

How did the final cost compare to the initial estimated cost, considering the CPFF structure?

The provided data shows an obligated amount of $786,430,454, which aligns with the contract value. However, the data does not explicitly state the initial estimated cost or provide a breakdown of the fixed fee versus the cost reimbursement. In a Cost Plus Fixed Fee (CPFF) contract, the government pays the contractor's actual allowable costs plus a fixed fee, which represents the contractor's profit. While the total obligated amount gives us the ceiling or actual expenditure, without knowing the initial estimate or the breakdown of costs and fee, it's impossible to definitively state how the final cost compared to the initial estimate or to assess the efficiency of cost control under this specific CPFF arrangement.

What was Tracor Systems Technology's track record with similar large-scale defense contracts prior to this award?

Tracor Systems Technology was a significant defense contractor during the period this contract was active. While specific details of their prior track record are not in the provided data snippet, companies of this size and scope typically had a history of performing various complex defense-related services, including maintenance, systems integration, and research and development. Their ability to win a large, full-and-open competition contract like this suggests they had demonstrated capabilities and past performance that met the Department of Defense's requirements at the time. Further investigation into historical contract awards and performance reviews for Tracor Systems Technology would be needed for a comprehensive assessment.

Were there any significant performance issues or contract disputes reported during the contract's lifecycle?

The provided data does not contain information regarding performance issues, disputes, or contract modifications beyond the extended completion date. The contract was originally awarded with a 24-month duration but ultimately extended to over 9 years (from March 1997 to October 2003). Such extensions can sometimes be indicative of scope changes, unforeseen challenges, or performance-related adjustments. However, without access to contract modification details, performance reports, or dispute logs, it is not possible to ascertain if any significant issues arose during its execution.

How does the per-unit cost of repair, if calculable, compare to industry benchmarks for similar naval vessel maintenance?

Calculating a meaningful 'per-unit cost' for this contract is extremely challenging due to its nature. The contract covers a broad range of 'non-nuclear ship repair' services for potentially multiple vessels over an extended period. Unlike contracts for standardized goods, ship repair costs are highly variable, depending on the specific vessel type, its condition, the scope of work required, and the complexity of the repairs. Without detailed work breakdown structures, specific repair tasks performed, and comparable data for identical repair scopes on similar vessels from the same time period, establishing a valid per-unit cost benchmark is not feasible with the given information.

What was the total historical spending by the Department of Defense on non-nuclear ship repair in the years surrounding this contract award?

The provided data snippet focuses on a single contract award and does not offer historical spending trends for the Department of Defense (DoD) on non-nuclear ship repair. To determine this, one would need to access comprehensive DoD procurement databases or budget reports covering multiple fiscal years. Analyzing such data would involve filtering for contracts with relevant Product Service Codes (PSCs) or keywords related to ship repair and maintenance, excluding nuclear-related services. This would allow for an aggregation of spending to understand the overall investment in this capability during that period and contextualize the $786 million award.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1601 RESEARCH BLVD, ROCKVILLE, MD, 20850

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

Contract Characteristics

Cost or Pricing Data: YES

Timeline