DoD's $150M+ Facilities Support Contract Awarded to BAE Systems Technical Services Shows Mixed Value

Contract Overview

Contract Amount: $22,381,992 ($22.4M)

Contractor: BAE Systems Technical Services

Awarding Agency: Department of Defense

Start Date: 2001-10-01

End Date: 2006-09-30

Contract Duration: 1,825 days

Daily Burn Rate: $12.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: 200201!002058!1700!SA10A !FLEET & INDUSTRIAL SUPPLY CENTER!N0060401CA010 !A!N! !N! !20011001!20020930!150805703!876861790!217304393!N!BAE SYSTEMS TECHNICAL SERVICES!557 MARY ESTHER CUT-OFF !FORT WALTON BE !FL!32548!46100!003!15!LUALUALEI NM !HONOLULU !HAWAII !+000005133558!N!N!000025171032!R799!OTHER MANAGEMENT SUPPORT SERVICES !S1 !SERVICES !2000!NOT DISCERNABLE OR CLASSIFIED !561210!E! !3! ! ! ! ! !99990909!B! ! !A! !A!U!J!2!002!B! !C!Y!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!D!N! ! ! ! ! !N61449!0001!

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $22.4 million to BAE SYSTEMS TECHNICAL SERVICES for work described as: 200201!002058!1700!SA10A !FLEET & INDUSTRIAL SUPPLY CENTER!N0060401CA010 !A!N! !N! !20011001!20020930!150805703!876861790!217304393!N!BAE SYSTEMS TECHNICAL SERVICES!557 MARY ESTHER CUT-OFF !FORT WALTON BE !FL!32548!46100!003!15!LUALUALEI NM !HONOL… Key points: 1. Contract value exceeds $150 million, indicating a significant investment in facilities support. 2. Awarded under full and open competition, suggesting a potentially competitive bidding process. 3. The contract duration of 5 years (1825 days) allows for long-term service provision. 4. The primary service category is Facilities Support Services, a critical operational need. 5. BAE Systems Technical Services has a substantial contract history, implying experience. 6. The contract's performance period spans from 2001 to 2006, providing historical context.

Value Assessment

Rating: fair

The total award amount of $150,805,703 for facilities support services over five years suggests a substantial investment. Benchmarking this against similar large-scale facilities management contracts within the Department of Defense is challenging without more granular data on the specific services rendered and their scope. However, the duration and value indicate a significant commitment. The firm-fixed-price contract type aims to control costs, but the ultimate value-for-money depends heavily on the contractor's efficiency and the government's oversight of performance against the defined scope.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, which typically involves a broad solicitation to all responsible sources. The presence of two bids suggests that while competition was present, it was not extensive. A limited number of bidders can sometimes lead to less aggressive pricing compared to scenarios with numerous competing offers. The government's ability to secure the best possible price and value is influenced by the level of interest and the quality of proposals received.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to foster a competitive environment that drives down costs and improves service quality. However, with only two bids, the potential for cost savings might be less pronounced than in a more crowded field.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel, who rely on well-maintained facilities for operational readiness. Services delivered likely include maintenance, repair, operations, and potentially management of various facility aspects. The geographic impact is concentrated around the Navy's Fleet & Industrial Supply Center, likely supporting operations in Hawaii. The contract supports a workforce, both directly employed by BAE Systems and potentially indirectly through subcontractors, contributing to local economies.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (2 bidders) may have restricted price negotiation leverage.
The firm-fixed-price nature requires careful scope management to avoid cost overruns due to unforeseen issues.
Long-term contracts can sometimes lead to complacency if not actively managed and overseen.
The specific details of services and performance metrics are not fully elaborated, making a precise value assessment difficult.

Positive Signals

Awarded through full and open competition, indicating an effort to maximize the pool of potential offerors.
The contractor, BAE Systems Technical Services, has a significant presence and likely substantial experience in government contracting.
The firm-fixed-price contract type provides cost certainty for the government, assuming effective performance management.
The contract duration allows for stable, long-term support, potentially leading to efficiencies and specialized expertise development.

Sector Analysis

Facilities Support Services represent a significant segment within the broader professional, scientific, and technical services sector. This contract falls under the North American Industry Classification System (NAICS) code 561210. The market for facilities management is large and diverse, encompassing everything from routine maintenance to complex building operations. Government contracts of this magnitude often represent a substantial portion of a contractor's revenue and require specialized capabilities in managing large-scale operations, compliance, and logistics.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'SS: false'. There is no explicit mention of subcontracting goals for small businesses within the provided data. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, though BAE Systems may engage small businesses as subcontractors independently.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Navy, specifically the contracting officer and their representatives responsible for monitoring performance, ensuring compliance with contract terms, and approving payments. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse. Transparency is facilitated through contract databases like FPDS, but detailed performance reports and audits are typically internal government documents.

Related Government Programs

Department of Defense Facilities Maintenance Contracts
Navy Base Operations Support
Government Facilities Management Services
Professional, Scientific, and Technical Services Contracts

Risk Flags

Limited Competition
Potential for Cost Overruns (FFP)
Contract Duration Risk
Scope Definition Clarity

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.4 million to BAE SYSTEMS TECHNICAL SERVICES. 200201!002058!1700!SA10A !FLEET & INDUSTRIAL SUPPLY CENTER!N0060401CA010 !A!N! !N! !20011001!20020930!150805703!876861790!217304393!N!BAE SYSTEMS TECHNICAL SERVICES!557 MARY ESTHER CUT-OFF !FORT WALTON BE !FL!32548!46100!003!15!LUALUALEI NM !HONOLULU !HAWAII !+000005133558!N!N!000025171032!R799!OTHER MANAGEMENT SUPPORT SERVICES !S1 !SERVICES !2000!NOT DISCERNABLE OR CLASSIFIED !561210!E! !3! ! ! ! ! !99990909!B

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TECHNICAL SERVICES.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $22.4 million.

What is the period of performance?

Start: 2001-10-01. End: 2006-09-30.

What specific types of facilities support services were included in this contract?

The provided data indicates the contract falls under NAICS code 561210, 'Facilities Support Services.' While the specific breakdown isn't detailed, this category typically encompasses a wide range of services essential for the operation and maintenance of government facilities. These can include routine maintenance and repair of buildings and grounds, custodial services, pest control, refuse collection, security systems maintenance, and potentially energy management and infrastructure support. The contract's value and duration suggest a comprehensive suite of services rather than a single, narrowly defined task.

How does the $150.8 million contract value compare to similar facilities support contracts awarded by the DoD?

The $150.8 million award for a five-year period is a substantial contract, averaging over $30 million annually. Within the Department of Defense, contracts of this size for facilities support are not uncommon, particularly for major installations or regional support centers. However, direct comparisons are difficult without knowing the specific scope of services, geographic location, and the complexity of the facilities managed. Larger bases or those with extensive infrastructure (e.g., power generation, complex HVAC, specialized labs) would naturally command higher contract values. This award appears to be within the typical range for comprehensive facilities management at a significant Navy installation.

What are the potential risks associated with a firm-fixed-price contract of this magnitude and duration?

The primary risk with a firm-fixed-price (FFP) contract of this size and duration (5 years) is that the contractor may face unforeseen cost increases due to inflation, material price volatility, or unexpected scope creep that isn't adequately managed. If the initial price was set too low or the scope wasn't perfectly defined, the contractor might struggle to maintain profitability, potentially impacting service quality or leading to requests for contract modifications. Conversely, if the price was set too high, the government might overpay. Effective government oversight is crucial to ensure the contractor performs diligently and that the scope remains controlled.

What does the limited number of bidders (2) suggest about the competition and potential value for taxpayers?

Having only two bidders for a contract valued at over $150 million suggests that the competition, while present, was not as robust as it could have been. A larger number of bidders typically drives prices down and encourages more innovative solutions. With only two offers, the government's negotiating leverage might be somewhat reduced. It's possible that the specialized nature of the services required, the geographic location, or stringent pre-qualification requirements limited the number of capable companies willing or able to bid. This could mean that the price achieved might not be the absolute lowest possible, potentially impacting the value realized by taxpayers.

What is the track record of BAE Systems Technical Services in performing large federal contracts?

BAE Systems Technical Services, as part of the larger BAE Systems conglomerate, has a well-established track record of performing large and complex contracts for the U.S. federal government, particularly within the Department of Defense. They are known for providing a wide range of technical, engineering, and support services. While this specific contract (N0060401CA010) ended in 2006, the company consistently wins and executes significant contracts across various agencies. Their extensive experience suggests a capacity to manage large budgets, complex logistics, and demanding performance requirements, although specific performance outcomes on any given contract depend on numerous factors.

How has federal spending on Facilities Support Services (NAICS 561210) evolved since this contract was awarded?

Federal spending on Facilities Support Services (NAICS 561210) has generally increased significantly since this contract, which ran from 2001-2006. Factors contributing to this rise include increased infrastructure needs, a greater reliance on outsourcing non-core functions, evolving security requirements, and investments in energy efficiency and sustainability. The total federal obligations for this sector have grown substantially over the past two decades, reflecting the ongoing demand for comprehensive facility management across government agencies. This trend highlights the enduring importance and expanding scope of facilities support services in government operations.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Parent Company: BAE Systems PLC

Address: 557 MARY ESTHER CUT-OFF, FORT WALTON BE, FL, 32548

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

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline