DoD awards $46.6M for F-5N BUP Material, with limited competition and a long performance period

Contract Overview

Contract Amount: $46,643,998 ($46.6M)

Contractor: Tactical AIR Support, Inc.

Awarding Agency: Department of Defense

Start Date: 2023-02-15

End Date: 2026-06-30

Contract Duration: 1,231 days

Daily Burn Rate: $37.9K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: F-5N BUP MATERIAL

Place of Performance

Location: JACKSONVILLE, DUVAL County, FLORIDA, 32221

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $46.6 million to TACTICAL AIR SUPPORT, INC. for work described as: F-5N BUP MATERIAL Key points: 1. The contract value of $46.6M for aircraft parts suggests a significant investment in maintaining aging military fleets. 2. Limited competition for specialized aircraft components can lead to higher costs and reduced innovation. 3. The extended performance period of over three years indicates a long-term need for these materials. 4. The fixed-price contract type shifts some risk to the contractor, but the lack of competition may limit its effectiveness. 5. This contract supports the Navy's tactical aviation readiness, crucial for national defense operations. 6. The absence of small business set-asides or subcontracting plans warrants further investigation into broader economic impact.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific details on the F-5N BUP material. However, the $46.6M award for aircraft parts over a 3-year period suggests a substantial unit cost. The lack of competition raises concerns about whether the government is achieving optimal pricing. Comparing this to similar sole-source or limited-competition procurements for specialized aerospace components would be necessary for a more precise value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, TACTICAL AIR SUPPORT, INC., was solicited. This approach is typically used when only one responsible source is available or when there is a compelling justification for other than full and open competition. The lack of multiple bidders means there was no opportunity for price comparison or negotiation among competing firms, potentially leading to a less favorable price for the government.

Taxpayer Impact: Sole-source awards limit the government's ability to leverage competition to drive down costs, potentially resulting in higher expenditures for taxpayers compared to a competitively bid contract.

Public Impact

The primary beneficiaries are the Department of the Navy and the U.S. Air Force, who rely on the F-5N aircraft for training and tactical support. The contract delivers essential 'BUP' (Base Upgrade Program) materials, critical for the continued airworthiness and operational readiness of the F-5N fleet. The contract's performance is geographically centered in Florida (ST, SN), indicating a concentration of F-5N support activities in that region. This contract supports specialized jobs within the aerospace and defense manufacturing sector, particularly those with expertise in legacy aircraft sustainment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing and reduced value for taxpayer dollars.
Sole-source awards can stifle innovation by not encouraging new entrants or alternative solutions.
The long duration of the contract could lock the government into a potentially suboptimal arrangement if market conditions change.
Limited transparency in the sole-source justification process could obscure potential inefficiencies.
Absence of small business participation raises questions about equitable distribution of federal contracting opportunities.

Positive Signals

The contract ensures the continued operational readiness of a critical tactical aircraft platform.
The fixed-price contract type provides some cost certainty for the government, assuming the contractor's pricing is reasonable.
The contractor, TACTICAL AIR SUPPORT, INC., is likely chosen for specialized expertise required for these specific aircraft components.
The extended performance period suggests a stable and reliable supply chain for essential materials.

Sector Analysis

The aerospace and defense sector is characterized by high barriers to entry, complex supply chains, and significant government investment. Contracts for specialized aircraft components, especially for legacy platforms like the F-5N, often involve limited competition due to the unique technical expertise and certifications required. The total addressable market for such niche components can be small, making it difficult for multiple firms to compete profitably. This contract fits within the broader category of aircraft parts and maintenance, a substantial segment of defense spending.

Small Business Impact

This contract does not appear to include any specific small business set-asides, nor are there indications of subcontracting plans for small businesses. The sole-source nature of the award further limits opportunities for small businesses to participate. This suggests that the primary focus was on securing the necessary materials from a specific provider, potentially overlooking opportunities to foster small business growth within the defense supply chain.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. The Defense Contract Management Agency (DCMA) may also provide oversight for contract performance and compliance. Transparency is limited due to the sole-source nature, but contract modifications, payment reports, and performance reviews would be key areas for accountability. Inspector General (IG) involvement would typically be triggered by allegations of fraud, waste, or abuse.

Related Government Programs

F-5 Aircraft Sustainment Programs
Tactical Aircraft Fleet Modernization
Aerospace Component Manufacturing
Defense Logistics and Supply Chain Management
Naval Aviation Readiness Initiatives

Risk Flags

Sole-source award
Potential for inflated pricing
Lack of small business participation
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $46.6 million to TACTICAL AIR SUPPORT, INC.. F-5N BUP MATERIAL

Who is the contractor on this award?

The obligated recipient is TACTICAL AIR SUPPORT, 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 $46.6 million.

What is the period of performance?

Start: 2023-02-15. End: 2026-06-30.

What is the specific nature of the 'F-5N BUP MATERIAL' and why is it critical for the F-5N aircraft?

The 'F-5N BUP MATERIAL' refers to components and parts necessary for the Base Upgrade Program (BUP) of the F-5N aircraft. The F-5N is a variant of the Northrop F-5 Tiger II, often used as an adversary or aggressor aircraft for training purposes by the U.S. Navy and Marine Corps. The BUP likely involves upgrades or essential maintenance to ensure the aircraft's continued airworthiness, safety, and operational effectiveness. These materials could range from structural components, avionics parts, engine accessories, or specialized systems required to meet current operational standards or extend the service life of these aging airframes. Without these specific materials, the Navy's ability to maintain its F-5N fleet for training and tactical support missions would be severely compromised.

How does the $46.6M contract value compare to historical spending on F-5N BUP materials?

Historical spending data for this specific 'F-5N BUP MATERIAL' is not readily available in the provided data. However, the $46.6M award over approximately three years (February 2023 to June 2026) suggests an average annual expenditure of roughly $15.5M for these materials. To assess if this is high or low, one would need to compare it against previous contracts for similar F-5N upgrades or sustainment efforts. Factors such as inflation, changes in material availability, and the scope of the BUP itself would influence year-over-year comparisons. Without prior contract data, a direct historical comparison is not feasible, but the current award represents a significant, ongoing investment in the F-5N platform.

What are the risks associated with awarding this contract on a sole-source basis?

The primary risk of a sole-source award is the potential for the government to pay a higher price than it would in a competitive environment. Without competing bids, TACTICAL AIR SUPPORT, INC. may have less incentive to offer the most cost-effective solution. There's also a risk that the government might not be aware of or have access to potentially superior or more innovative solutions that other vendors could offer. Furthermore, sole-source contracts can sometimes indicate a lack of market research or a failure to identify potential sources, which could point to systemic issues in the procurement process. This can also limit opportunities for small businesses and potentially lead to a less resilient supply chain if the sole provider faces difficulties.

What is the track record of TACTICAL AIR SUPPORT, INC. in fulfilling similar defense contracts?

TACTICAL AIR SUPPORT, INC. (TACAIR) has a significant track record in supporting military aviation, particularly with legacy aircraft like the F-5. They specialize in providing "Affordable, Turn-Key, Adversary Air" (A2) services, which often involve maintaining, modifying, and operating aggressor aircraft fleets for training exercises. Their experience likely includes extensive work on the F-5 platform, encompassing component sourcing, repair, overhaul, and integration. While this specific contract is for materials, TACAIR's broader experience suggests they possess the necessary technical expertise and infrastructure to handle such procurements. A deeper dive into their contract history, including past performance reviews and any past issues, would provide a more comprehensive assessment.

How does this contract align with the Navy's broader strategy for tactical aviation readiness?

This contract directly supports the Navy's tactical aviation readiness by ensuring the continued operational capability of the F-5N fleet. The F-5N serves a crucial role as an aggressor aircraft, simulating enemy threats during training exercises for fighter pilots and other aircrews. Maintaining these aircraft with essential BUP materials is vital for providing realistic training scenarios, which are fundamental to pilot proficiency and overall combat readiness. The investment in these materials signifies the Navy's ongoing reliance on the F-5N for its training programs, even as newer platforms are introduced. It underscores a strategy that balances the need for advanced capabilities with the cost-effective sustainment of existing, valuable assets.

What are the potential long-term implications of relying on sole-source providers for critical aircraft components?

Long-term reliance on sole-source providers for critical aircraft components can create significant strategic vulnerabilities. It can lead to vendor lock-in, where the government becomes dependent on a single supplier, potentially facing escalating costs and limited negotiation leverage over time. This dependency can also stifle technological advancement, as the sole provider may have little incentive to innovate or adopt more efficient manufacturing processes if competition is absent. Furthermore, if the sole provider experiences financial difficulties, production issues, or goes out of business, it could lead to critical supply chain disruptions, impacting aircraft availability and readiness. Developing alternative sources or fostering competition, even for specialized components, is generally a more sustainable long-term strategy.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0042121R0139

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 13401 AEROSPACE WAY HNGR 945, JACKSONVILLE, FL, 32221

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

Financial Breakdown

Contract Ceiling: $46,643,998

Exercised Options: $46,643,998

Current Obligation: $46,643,998

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0042122D0095

IDV Type: IDC

Timeline