DoD's $557.8M DynCorp contract for air transportation support shows fair value, but limited competition concerns

Contract Overview

Contract Amount: $557,766,684 ($557.8M)

Contractor: Dyncorp International LLC

Awarding Agency: Department of Defense

Start Date: 2011-07-12

End Date: 2017-03-31

Contract Duration: 2,089 days

Daily Burn Rate: $267.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: NTWL - LABOR

Place of Performance

Location: CHANTILLY, FAIRFAX County, VIRGINIA, 20151

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $557.8 million to DYNCORP INTERNATIONAL LLC for work described as: NTWL - LABOR Key points: 1. Contract value of $557.8M over 5 years suggests significant operational support. 2. Competition was full and open, but only two bids were received, potentially limiting price discovery. 3. Cost-plus-fixed-fee structure may incentivize cost escalation, requiring robust oversight. 4. Performance period of nearly 6 years indicates a long-term need for these services. 5. The contract falls under 'Other Support Activities for Air Transportation,' a critical but often complex sector. 6. Small business participation was not a stated goal, potentially missing opportunities for smaller firms.

Value Assessment

Rating: fair

The total award of $557.8M for nearly 6 years of air transportation support appears within a reasonable range for complex logistical services. However, without specific benchmarks for 'Other Support Activities for Air Transportation,' a precise value-for-money assessment is challenging. The cost-plus-fixed-fee (CPFF) pricing structure, while common for services with uncertain costs, carries inherent risks of cost overruns compared to fixed-price contracts. The relatively low number of bids (2) also raises questions about whether the government secured the most competitive pricing possible.

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. However, only two bids were received. This limited number of bidders, despite open competition, could suggest a specialized market or high barriers to entry for potential competitors. While open competition is generally preferred, a low bid count can sometimes lead to less aggressive pricing than a more robustly contested procurement.

Taxpayer Impact: While the competition was open, the low number of bidders may have resulted in a higher price for taxpayers than if more companies had vied for the contract. This highlights the importance of market research to ensure sufficient competition exists for critical services.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel, who receive essential air transportation support services. Services likely include maintenance, logistics, ground support, and potentially flight operations management for military aircraft. The geographic impact is likely global, supporting DoD operations wherever air transport is required. Workforce implications include employment for DynCorp International personnel, potentially including pilots, mechanics, logisticians, and administrative staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contract type can lead to higher costs if not managed tightly.
Limited number of bidders (2) in a full and open competition may indicate insufficient market interest or high entry barriers.
Lack of specific small business set-aside or subcontracting goals might limit opportunities for smaller businesses in this large contract.
The broad 'Other Support Activities for Air Transportation' category lacks specificity, making direct performance comparisons difficult.

Positive Signals

Awarded under full and open competition, ensuring a broad initial solicitation.
Long performance period (nearly 6 years) suggests a stable, ongoing need and potential for contractor efficiency through experience.
DynCorp International is a known entity in government contracting, implying some level of established capability.
The contract value indicates a significant scale of operations, likely supporting critical DoD missions.

Sector Analysis

The 'Other Support Activities for Air Transportation' sector encompasses a wide range of services essential for the functioning of aviation, including maintenance, repair, logistics, and operational support. This contract likely falls within the broader aerospace and defense services market, which is characterized by high technical requirements, stringent regulatory oversight, and significant government spending. Comparable spending benchmarks are difficult to establish without more specific service details, but large-scale support contracts for military aviation can run into hundreds of millions or even billions of dollars.

Small Business Impact

This contract does not appear to have included specific small business set-aside provisions, nor is there explicit mention of subcontracting goals for small businesses. Given the large contract value and the nature of the services, it's possible that larger prime contractors were expected to handle the bulk of the work. This approach may limit the direct participation of small businesses as prime contractors, although they could potentially serve as subcontractors if opportunities arise. The absence of explicit small business focus might represent a missed opportunity to foster growth within the small business ecosystem for specialized aviation support.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. The Cost Plus Fixed Fee (CPFF) structure necessitates rigorous financial oversight to monitor costs and ensure the fixed fee remains appropriate. Accountability measures would include performance reviews, adherence to contract terms, and delivery of required services. Transparency is generally maintained through contract award databases and reporting requirements, though detailed operational specifics may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Logistics Support Contracts
Air Mobility Command Services
Naval Air Systems Command Support Contracts
Aviation Maintenance and Repair Services
Global Air Transportation Management

Risk Flags

Cost-plus contract type
Low bidder count
Specialized industry

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $557.8 million to DYNCORP INTERNATIONAL LLC. NTWL - LABOR

Who is the contractor on this award?

The obligated recipient is DYNCORP INTERNATIONAL 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 $557.8 million.

What is the period of performance?

Start: 2011-07-12. End: 2017-03-31.

What is DynCorp International's track record with similar Department of Defense contracts, particularly in air transportation support?

DynCorp International has a long history of providing aviation and support services to the U.S. military and government agencies. They have held numerous large contracts involving aircraft maintenance, logistics, training, and operational support, often in complex or austere environments. Their experience includes extensive work with the Department of the Air Force, Army, and Navy. While specific performance metrics for past air transportation support contracts are not detailed here, their sustained presence in this market suggests a capacity to meet DoD requirements. However, like many large contractors, they have faced scrutiny and audits on various contracts over the years, underscoring the need for diligent oversight on all awards.

How does the $557.8M award compare to other 'Other Support Activities for Air Transportation' contracts awarded by the DoD?

The $557.8M total award value for this contract, spanning nearly six years, places it as a significant procurement within the 'Other Support Activities for Air Transportation' category. Contracts in this NAICS code can vary widely, from smaller, specialized maintenance agreements to large, comprehensive global support packages. Given the duration and the likely scope of services for a major military branch like the Navy, this award appears to be in the mid-to-upper range for such contracts. Without access to a comprehensive database of all comparable contracts, including their specific service inclusions and performance periods, a precise benchmarking is difficult. However, the scale suggests a substantial operational requirement being met.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for air transportation support?

The primary risk with a CPFF contract is the potential for cost overruns. In this structure, the contractor is reimbursed for allowable costs plus a fixed fee representing profit. If the contractor's costs exceed initial estimates, the government bears the burden of these increased expenses, while the contractor's profit (the fixed fee) remains constant. This can disincentivize cost control by the contractor. For air transportation support, risks include unexpected maintenance needs, fluctuating fuel prices (if not explicitly excluded or managed), and unforeseen logistical challenges. Effective oversight, detailed cost tracking, and clear definitions of allowable costs are crucial to mitigate these risks and ensure fair value.

What does the limited number of bidders (2) in a 'full and open competition' imply for program effectiveness and cost?

A limited number of bidders, even in a 'full and open competition,' can have several implications. It might suggest that the market for these specific services is concentrated among a few large providers, or that the barriers to entry (e.g., technical expertise, security clearances, equipment) are very high. For program effectiveness, it could mean that the government is working with established, experienced providers, which can lead to reliable service delivery. However, from a cost perspective, fewer bidders generally translate to less competitive pressure. This can result in higher prices than might be achieved in a more crowded marketplace. It also raises questions about whether the government adequately solicited interest or if potential bidders were deterred for other reasons.

How has federal spending in 'Other Support Activities for Air Transportation' evolved over the past decade, and where does this contract fit?

Federal spending in 'Other Support Activities for Air Transportation' (NAICS 488190) has generally remained substantial, driven by the ongoing needs of the Department of Defense and other agencies for aviation logistics, maintenance, and operational support. Spending levels can fluctuate based on geopolitical events, modernization programs, and budget allocations. This $557.8M contract, awarded in 2011 for services through 2017, represents a significant single award within this category during that period. It reflects the government's reliance on contractors for specialized aviation support, often to supplement organic military capabilities or provide services in areas where military personnel or infrastructure are not optimally positioned.

Industry Classification

NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0042109R0140

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Amentum Services, Inc.

Address: 13500 HERITAGE PKWY, FORT WORTH, TX, 76177

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

Financial Breakdown

Contract Ceiling: $595,541,268

Exercised Options: $576,467,652

Current Obligation: $557,766,684

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline