DoD's $296.5M H-60 SEAHAWK PBL Contract Lacks Competition, Raises Cost Concerns

Contract Overview

Contract Amount: $296,522,080 ($296.5M)

Contractor: Maritime Helicopter Support Company LLC

Awarding Agency: Department of Defense

Start Date: 2018-10-03

End Date: 2019-09-30

Contract Duration: 362 days

Daily Burn Rate: $819.1K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: H-60 SEAHAWK PBL PROVIDING LOGISTICAL SUPPORT TO APPROXIMATELY 1700 WEAPON REPLACEABLE ASSEMBLIES AND SHOP REPLACEABLE ASSEMBLIES.

Place of Performance

Location: OWEGO, TIOGA County, NEW YORK, 13827

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $296.5 million to MARITIME HELICOPTER SUPPORT COMPANY LLC for work described as: H-60 SEAHAWK PBL PROVIDING LOGISTICAL SUPPORT TO APPROXIMATELY 1700 WEAPON REPLACEABLE ASSEMBLIES AND SHOP REPLACEABLE ASSEMBLIES. Key points: 1. The contract supports approximately 1700 weapon and shop replaceable assemblies for the H-60 SEAHAWK. 2. MARITIME HELICOPTER SUPPORT COMPANY LLC is the sole provider, indicating a lack of competition. 3. The firm fixed price contract type offers some cost certainty, but the absence of competition is a risk. 4. Spending is concentrated in the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector.

Value Assessment

Rating: questionable

The contract's value of $296.5 million for logistical support of H-60 SEAHAWK components is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar support contracts.

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 potentially leads to higher costs for the government.

Taxpayer Impact: The lack of competition means taxpayers may be paying a premium for logistical support services that could potentially be procured at a lower cost through a competitive process.

Public Impact

Essential logistical support for a critical military asset (H-60 SEAHAWK) is being provided. The sole-source nature of the contract raises questions about long-term cost-effectiveness for taxpayers. Dependence on a single contractor for these parts could create supply chain vulnerabilities. The contract duration of 362 days suggests a focus on immediate operational needs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Potential for inflated pricing

Positive Signals

Provides critical logistical support
Firm fixed price contract type

Sector Analysis

This contract falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector, supporting the H-60 SEAHAWK helicopter. Benchmarks for similar sole-source logistical support contracts are difficult to establish without competitive data.

Small Business Impact

There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. Further analysis would be needed to determine potential opportunities for small business participation.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny from oversight bodies to ensure the government is receiving best value. A review of the justification for not competing the contract is essential.

Related Government Programs

Other Aircraft Parts and Auxiliary Equipment Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Sole-source award limits price discovery.
Potential for above-market pricing.
Lack of transparency in contractor selection.
Risk of contractor dependency.
No indication of small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $296.5 million to MARITIME HELICOPTER SUPPORT COMPANY LLC. H-60 SEAHAWK PBL PROVIDING LOGISTICAL SUPPORT TO APPROXIMATELY 1700 WEAPON REPLACEABLE ASSEMBLIES AND SHOP REPLACEABLE ASSEMBLIES.

Who is the contractor on this award?

The obligated recipient is MARITIME HELICOPTER SUPPORT COMPANY 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 $296.5 million.

What is the period of performance?

Start: 2018-10-03. End: 2019-09-30.

What was the justification for awarding this contract on a sole-source basis instead of through competition?

The provided data indicates the contract was 'NOT COMPETED'. A thorough review would be required to understand the specific justification, which could include factors like unique capabilities, urgent needs, or lack of available sources. Without this justification, it's impossible to fully assess the necessity of a sole-source award and its potential impact on cost.

How does the per-unit cost of these assemblies compare to industry benchmarks, given the sole-source nature of the contract?

Without competitive bidding, establishing a reliable per-unit cost benchmark is challenging. The absence of competition suggests that the government may not be benefiting from market-driven pricing. A detailed cost analysis, potentially involving independent government cost estimators or market research into similar commercial parts, would be necessary to assess value for money.

What are the long-term risks associated with relying on a single contractor for critical H-60 SEAHAWK logistical support?

Long-term reliance on a sole-source provider for critical logistical support carries risks such as price escalation over time, potential for complacency in service quality, and supply chain vulnerabilities if the contractor faces financial or operational difficulties. This could impact the operational readiness of the H-60 SEAHAWK fleet.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1801 STATE ROUTE 17C, OWEGO, NY, 13827

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $296,522,080

Exercised Options: $296,522,080

Current Obligation: $296,522,080

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0038315D008F

IDV Type: IDC

Timeline