DoD's $12.3M DASN Support Services contract awarded to Red River Resources LLC raises value concerns

Contract Overview

Contract Amount: $12,277,865 ($12.3M)

Contractor: RED River Resources LLC

Awarding Agency: Department of Defense

Start Date: 2021-03-19

End Date: 2026-03-18

Contract Duration: 1,825 days

Daily Burn Rate: $6.7K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: DASN SUPPORT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20350

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $12.3 million to RED RIVER RESOURCES LLC for work described as: DASN SUPPORT SERVICES Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. The contract's cost-plus-fixed-fee structure may incentivize higher spending. 3. Limited competition raises questions about whether the government secured the best possible value. 4. The contract duration of 5 years (1825 days) suggests a long-term need for these services. 5. The administrative management and general management consulting services sector is highly competitive, making the sole-source award notable. 6. The contract's value is moderate within the context of large federal IT and professional services spending.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature and the lack of publicly available comparable contract data. The cost-plus-fixed-fee (CPFF) pricing structure, while offering flexibility, can lead to higher costs if not carefully managed, as the contractor is reimbursed for all allowable costs plus a fixed fee. Without competitive bids, it's difficult to ascertain if the fixed fee and overall price represent a fair market value for the administrative management and general management consulting services provided. Further analysis of the contractor's performance and cost reporting would be necessary to definitively assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This typically occurs when only one vendor is capable of meeting the requirement, or in specific circumstances like urgent needs or follow-on work to a previously competed contract. The lack of competition means that the Department of the Navy did not benefit from the price reductions and innovation that often arise from a competitive bidding process. This limits the government's ability to ensure it is receiving the most cost-effective solution.

Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the best possible price, as the absence of competition removes a key driver for cost savings.

Public Impact

The Department of the Navy benefits from specialized administrative management and general management consulting services. These services likely support the operational efficiency and strategic planning of naval operations. The contract's impact is primarily within the federal government's administrative functions, with indirect benefits to national defense. Workforce implications are likely concentrated within Red River Resources LLC and potentially its subcontractors, rather than a broad public employment impact.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Cost-plus-fixed-fee structure can lead to cost overruns if not managed tightly.
Lack of transparency in the procurement process due to sole-source award.

Positive Signals

Contract awarded to a single entity suggests specialized capabilities.
Long-term contract (5 years) indicates a stable and ongoing need for the services.
Fixed fee component provides some level of cost predictability for the government.

Sector Analysis

The contract falls within the professional, scientific, and technical services sector, specifically administrative management and general management consulting. This sector is a significant component of federal spending, supporting a wide array of government functions. While specific benchmarks for 'DASN Support Services' are not readily available, comparable contracts for management consulting services to large federal agencies can range from hundreds of thousands to tens of millions of dollars annually. The $12.3 million total value over five years positions this as a moderate-sized contract within this broad sector.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is no explicit information regarding subcontracting plans for small businesses. Without specific set-aside goals or subcontracting requirements, the direct impact on the small business ecosystem is likely minimal, unless Red River Resources LLC voluntarily engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the Department of the Navy. Performance reviews, regular reporting requirements, and audits are standard oversight mechanisms. The effectiveness of transparency depends on the level of detail made public regarding contract performance and expenditures. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Management Consulting Services
Navy Administrative Support Contracts
Federal Professional Services Contracts
Cost-Plus-Fixed-Fee Contracts

Risk Flags

Sole-source award
Cost-plus-fixed-fee pricing
Lack of publicly available performance data

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.3 million to RED RIVER RESOURCES LLC. DASN SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is RED RIVER RESOURCES LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $12.3 million.

What is the period of performance?

Start: 2021-03-19. End: 2026-03-18.

What is the track record of Red River Resources LLC in performing similar government contracts?

Information regarding Red River Resources LLC's specific track record on similar government contracts is not detailed in the provided data. A comprehensive assessment would require reviewing past performance evaluations, contract history, and any reported issues or successes on previous federal awards. Understanding their experience with administrative management and general management consulting services, particularly within the Department of Defense or Navy, is crucial for evaluating their capability to fulfill the DASN Support Services requirement effectively and efficiently. Without this historical data, assessing their reliability and past performance is speculative.

How does the pricing structure (Cost Plus Fixed Fee) compare to other similar federal contracts for management consulting?

The Cost Plus Fixed Fee (CPFF) structure reimburses the contractor for all allowable costs plus a predetermined fixed fee. While CPFF provides flexibility for evolving requirements, it can be less cost-effective than fixed-price contracts if costs escalate significantly. For management consulting services, federal agencies often utilize a mix of contract types. Fixed-price contracts are preferred when requirements are well-defined to encourage contractor efficiency. CPFF is more common for research and development or services with high uncertainty. Comparing this specific contract's fee and estimated costs to benchmarks for similar services would require access to detailed pricing data from comparable sole-source or competed contracts, which is not provided here. However, the CPFF structure inherently carries a higher risk of cost growth for the government compared to fixed-price arrangements.

What are the primary risks associated with a sole-source award for these services?

The primary risks associated with a sole-source award for administrative management and general management consulting services include a lack of competitive pricing, potentially leading to higher costs for the government and taxpayers. Without competition, there is reduced incentive for the contractor to innovate or optimize service delivery for cost savings. Furthermore, it limits the government's ability to explore alternative solutions or providers that might offer better value or specialized expertise. There's also a risk that the government may not be aware of more capable or cost-effective vendors in the market. Transparency and accountability can also be diminished without the open scrutiny inherent in a competitive bidding process.

What specific administrative management and general management consulting services are being provided under this contract?

The provided data indicates the contract is for 'Administrative Management and General Management Consulting Services' (NAICS code 541611). While the specific tasks are not detailed, these services typically encompass a broad range of support functions. This could include strategic planning, organizational analysis, process improvement, policy development, program management support, executive coaching, and general administrative oversight. For the Department of the Navy (DASN), these services likely aim to enhance operational efficiency, support decision-making, and improve the overall management of naval programs and functions. The exact nature of the services would be elaborated in the contract's Statement of Work (SOW).

What is the historical spending trend for DASN Support Services or similar contracts within the Department of the Navy?

Historical spending trends for DASN Support Services specifically are not detailed in the provided data. However, the Department of the Navy, as a major component of the Department of Defense, consistently spends billions of dollars annually on a wide array of support services, including management and administrative consulting. Spending in this category can fluctuate based on strategic priorities, budget allocations, and specific program needs. Analyzing broader trends in federal spending on management consulting services (NAICS 541611) would show significant and often increasing investment by defense agencies over the years to support complex operations and modernization efforts. This particular $12.3 million contract over five years represents a portion of that overall investment.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0018921RZ033

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 16885 W BERNARDO DR STE 255, SAN DIEGO, CA, 92127

Business Categories: 8(a) Program Participant, American Indian Owned Business, Category Business, Corporate Entity Not Tax Exempt, Economically Disadvantaged Women Owned Small Business, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $12,608,799

Exercised Options: $12,608,799

Current Obligation: $12,277,865

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline