DoD awards $143M to Longbow LLC for engineering services supporting Hellfire and Longbow missiles

Contract Overview

Contract Amount: $143,367,328 ($143.4M)

Contractor: Longbow LLC

Awarding Agency: Department of Defense

Start Date: 2016-01-12

End Date: 2021-09-30

Contract Duration: 2,088 days

Daily Burn Rate: $68.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF BASE AWARDS::CLINS 1602AA-1602AF::OPTION CLINS 1601 (LASER, 1603 (LONGBOW), 1701 (LASER), 1702 (LONGBOW:ENGINEERING SERVICES IN SUPPORT OF HELLFIRE LASER AND LONGBOW MISSILES

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32819

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $143.4 million to LONGBOW LLC for work described as: IGF::OT::IGF BASE AWARDS::CLINS 1602AA-1602AF::OPTION CLINS 1601 (LASER, 1603 (LONGBOW), 1701 (LASER), 1702 (LONGBOW:ENGINEERING SERVICES IN SUPPORT OF HELLFIRE LASER AND LONGBOW MISSILES Key points: 1. Contract awarded on a sole-source basis, raising questions about price discovery and potential for overpayment. 2. Significant duration of over 2000 days suggests a long-term need for these specialized engineering services. 3. The contract type (Cost Plus Fixed Fee) can incentivize cost overruns if not closely monitored. 4. Focus on missile engineering indicates a critical role in defense supply chain, with potential performance risks. 5. Geographic concentration in Florida may point to specific industrial capabilities or existing infrastructure. 6. Lack of competition limits opportunities for other firms and potentially higher value for the government.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature and specialized engineering services. Without competitive bids, it's difficult to ascertain if the $143 million represents a fair market price. The Cost Plus Fixed Fee structure, while common for complex R&D, requires rigorous oversight to ensure costs remain controlled and that the fixed fee is appropriate for the effort involved. Comparisons to similar sole-source engineering contracts for defense systems would be necessary for a more robust value assessment.

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 approach is typically used when only one vendor possesses the necessary unique capabilities, proprietary technology, or when urgent needs preclude a competitive process. The lack of competition means the government did not benefit from the price reductions and innovation that typically arise from a bidding process.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. Without competing offers, there is a reduced incentive for the contractor to offer the lowest possible price.

Public Impact

The Department of the Army is the primary beneficiary, receiving critical engineering support for its missile programs. Services delivered include engineering expertise essential for the development, maintenance, and enhancement of Hellfire and Longbow missile systems. The contract's geographic impact is concentrated in Florida, suggesting a reliance on regional expertise or facilities. Workforce implications include the employment of specialized engineers and technical staff within Longbow LLC and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially leads to higher costs for taxpayers.
Cost Plus Fixed Fee contract type carries inherent risk of cost escalation if not managed diligently.
Lack of transparency in pricing due to non-competitive award.
Potential for contractor lock-in given the specialized nature of the services and sole-source award.
Limited visibility into the contractor's cost structure and profit margins.

Positive Signals

Contract addresses critical defense needs for advanced missile systems.
Long duration suggests a stable, long-term relationship for essential services.
Focus on specialized engineering expertise ensures technical proficiency.
Award to a single entity may streamline communication and project management for specific missile programs.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting defense-related R&D and sustainment. The aerospace and defense industry is characterized by high barriers to entry, specialized technical requirements, and significant government investment. Comparable spending benchmarks would involve analyzing other sole-source or competitively awarded engineering support contracts for major defense platforms, which often run into hundreds of millions or billions of dollars over their lifecycle.

Small Business Impact

The contract data indicates that small business participation was not a stated requirement (ss: false, sb: false). As a sole-source award, there are no explicit subcontracting goals set aside for small businesses. This means opportunities for small businesses to participate in this specific contract are limited unless Longbow LLC voluntarily includes them in its supply chain. The absence of set-asides means the primary contract value does not directly contribute to small business contracting goals.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Army contracting officers and program managers. Given the Cost Plus Fixed Fee structure, rigorous financial oversight and auditing are crucial to monitor expenditures and ensure the fixed fee remains justified. Transparency is limited due to the sole-source nature. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Hellfire Missile Program
Longbow Missile Program
Defense Engineering Services Contracts
Missile Technology Development
Cost Plus Fixed Fee Contracts
Department of the Army Procurement

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Lack of competitive bidding
Potential for cost overruns
Limited transparency in pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $143.4 million to LONGBOW LLC. IGF::OT::IGF BASE AWARDS::CLINS 1602AA-1602AF::OPTION CLINS 1601 (LASER, 1603 (LONGBOW), 1701 (LASER), 1702 (LONGBOW:ENGINEERING SERVICES IN SUPPORT OF HELLFIRE LASER AND LONGBOW MISSILES

Who is the contractor on this award?

The obligated recipient is LONGBOW LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $143.4 million.

What is the period of performance?

Start: 2016-01-12. End: 2021-09-30.

What is the track record of Longbow LLC in delivering similar engineering services for defense contracts?

Assessing Longbow LLC's track record requires a deeper dive into their contract history beyond this single award. Information on past performance, including successful delivery of complex engineering services, adherence to schedules and budgets, and quality of work on previous defense contracts, would be crucial. Publicly available data may include past performance reviews or award fee determinations. Without this context, it's difficult to fully evaluate their capability to fulfill the requirements of this $143 million contract effectively and efficiently. A review of their financial stability and any history of contract disputes or terminations would also be pertinent.

How does the pricing structure (Cost Plus Fixed Fee) compare to industry standards for similar sole-source engineering contracts?

The Cost Plus Fixed Fee (CPFF) structure is common for research and development or complex services where the scope of work is not fully defined at the outset, making it difficult to establish a firm fixed price. For sole-source contracts, CPFF allows the government to pay the contractor's actual costs plus a pre-determined fixed fee. While this provides flexibility, it shifts much of the cost risk to the government. Industry standards suggest that for well-defined services, fixed-price contracts are preferred for better cost control. However, in specialized defense engineering, CPFF is often deemed necessary. The appropriateness of the fixed fee itself, relative to the effort and risk involved, is a key benchmark that requires detailed analysis of the contractor's proposed labor, overhead, and profit.

What are the primary risks associated with a sole-source award for critical missile engineering services?

The primary risks associated with a sole-source award for critical missile engineering services include a lack of competitive pricing, potentially leading to higher costs for the government. Without competition, there's reduced incentive for the contractor to innovate or optimize efficiency. There's also a risk of contractor over-reliance or 'lock-in,' where the government becomes dependent on a single provider, making future transitions difficult or costly. Furthermore, the absence of multiple bids limits the government's ability to explore alternative technical solutions or approaches that other firms might offer. Ensuring robust oversight and clear performance metrics becomes paramount to mitigate these risks.

What is the historical spending pattern for engineering services related to Hellfire and Longbow missiles by the Department of Defense?

Analyzing historical spending patterns for Hellfire and Longbow missile engineering services by the Department of Defense (DoD) would provide context for the $143 million award. This would involve examining previous contracts awarded for similar services, including their duration, value, and whether they were competitively or sole-source. Understanding trends in spending—whether increasing, decreasing, or stable—can indicate evolving program needs or shifts in acquisition strategies. Comparing this contract's value and duration to historical data can help identify if it represents a significant deviation or a continuation of established spending levels for these critical missile systems.

Are there any specific performance metrics or milestones tied to this contract that indicate its effectiveness?

The provided data does not detail specific performance metrics or milestones tied to this contract. For a Cost Plus Fixed Fee contract, performance is typically evaluated based on the contractor's ability to manage costs within the 'cost' portion while achieving the defined scope of work, and the delivery of the final product or service according to specifications. Effectiveness would be measured by the successful completion of engineering tasks, contribution to missile system readiness, and adherence to any technical requirements. Without access to the contract's statement of work and performance clauses, a definitive assessment of its effectiveness based on metrics is not possible.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W31P4Q15R0061

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 5600 W SAND LAKE RD, ORLANDO, FL, 32819

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

Financial Breakdown

Contract Ceiling: $284,631,561

Exercised Options: $143,367,328

Current Obligation: $143,367,328

Actual Outlays: $279,396

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline