DoD Awards Northrop Grumman $81.6M for C-RAM System Support Amidst Contingency Operations
Contract Overview
Contract Amount: $81,635,160 ($81.6M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2016-03-03
End Date: 2018-06-30
Contract Duration: 849 days
Daily Burn Rate: $96.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: IGF::OT::IGF A NEW SUPPLIES AND SERVICES CONTRACT WITH A TWO-YEAR PERIOD OF PERFORMANCE FOR INSTALLATION AND SUPPORT (I&S) OF THE COUNTER-ROCKET, ARTILLERY, AND MORTAR (C-RAM) SYSTEM OF SYSTEMS (SOS) IN SUPPORT OF U.S. AND COALITION PARTNER REQUIREMENTS IN RESPONSE TO SUSTAINMENT OF ONGOING CONTINGENCY OPERATIONS (SOCO).
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20171
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $81.6 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: IGF::OT::IGF A NEW SUPPLIES AND SERVICES CONTRACT WITH A TWO-YEAR PERIOD OF PERFORMANCE FOR INSTALLATION AND SUPPORT (I&S) OF THE COUNTER-ROCKET, ARTILLERY, AND MORTAR (C-RAM) SYSTEM OF SYSTEMS (SOS) IN SUPPORT OF U.S. AND COALITION PARTNER REQUIREMENTS IN RESPONSE TO SUSTAINMENT… Key points: 1. Contract awarded to Northrop Grumman for critical C-RAM system installation and support. 2. Significant funding of $81.6M allocated for a two-year period of performance. 3. Supports U.S. and coalition partners in ongoing contingency operations, highlighting strategic importance. 4. Engineering services (NAICS 541330) are the primary focus, indicating complex technical requirements.
Value Assessment
Rating: questionable
The contract's cost-plus-fixed-fee structure can lead to cost overruns if not managed tightly. Benchmarking against similar C-RAM sustainment contracts is difficult without more detailed cost breakdowns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as competition is absent.
Taxpayer Impact: The lack of competition for a significant contract raises concerns about the optimal use of taxpayer funds.
Public Impact
Ensures continued operational readiness of the C-RAM system, vital for force protection. Supports ongoing U.S. and coalition military operations in potentially high-threat environments. The award reflects the sustained need for advanced defense systems in current geopolitical contexts.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost-plus contract type
- Potential for cost overruns
Positive Signals
- Critical system support
- Support for coalition partners
- Addresses ongoing operational needs
Sector Analysis
This contract falls within the defense sector, specifically focusing on engineering services for advanced weapon systems. Spending in this area is often driven by national security imperatives and technological advancements, with significant investments typically made in complex systems like C-RAM.
Small Business Impact
The contract was awarded to Northrop Grumman Systems Corporation, a large business. There is no indication of subcontracting opportunities for small businesses within the provided data.
Oversight & Accountability
The Department of Defense, through the Defense Contract Management Agency, is responsible for overseeing this contract. Robust oversight is crucial given the sole-source nature and cost-plus contract type to ensure cost efficiency and performance.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award lacks competition
- Cost-plus contract type increases risk of overruns
- Limited transparency on pricing justification
- Potential for contractor lock-in
Tags
engineering-services, department-of-defense, va, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $81.6 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. IGF::OT::IGF A NEW SUPPLIES AND SERVICES CONTRACT WITH A TWO-YEAR PERIOD OF PERFORMANCE FOR INSTALLATION AND SUPPORT (I&S) OF THE COUNTER-ROCKET, ARTILLERY, AND MORTAR (C-RAM) SYSTEM OF SYSTEMS (SOS) IN SUPPORT OF U.S. AND COALITION PARTNER REQUIREMENTS IN RESPONSE TO SUSTAINMENT OF ONGOING CONTINGENCY OPERATIONS (SOCO).
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $81.6 million.
What is the period of performance?
Start: 2016-03-03. End: 2018-06-30.
What specific technical challenges or unique capabilities of Northrop Grumman justified a sole-source award for C-RAM system support?
Sole-source awards are typically justified when only one vendor possesses the necessary proprietary knowledge, technology, or existing infrastructure to meet the requirement. For C-RAM support, this could involve unique integration expertise with existing systems, specific intellectual property related to the system's design, or a proven track record of performance that makes transitioning to another vendor prohibitively complex or risky.
How will the cost-plus-fixed-fee structure be managed to mitigate risks of cost overruns and ensure fair pricing for taxpayers?
Effective management of a cost-plus-fixed-fee contract requires stringent oversight, detailed cost tracking, and regular audits. The government contracting officer must establish clear performance metrics and milestones. Regular reviews of incurred costs against the fixed fee and the total estimated cost are essential. Any deviations must be promptly addressed, and the contractor held accountable for managing expenses within the agreed-upon parameters.
What is the long-term strategy for C-RAM system sustainment, and will future requirements be competed to ensure better value?
The long-term strategy for C-RAM sustainment should ideally involve market research to identify potential competitors and explore options for increasing competition in future contract actions. While this initial award may be sole-source due to specific circumstances, subsequent requirements should be evaluated for competitive sourcing opportunities to leverage market forces and achieve better pricing and innovation for the Department of Defense.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: WEAPONS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W31P4Q16R0062
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 2340 DULLES CORNER BLVD, HERNDON, VA, 20171
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $81,842,571
Exercised Options: $81,842,571
Current Obligation: $81,635,160
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2016-03-03
Current End Date: 2018-06-30
Potential End Date: 2018-06-30 00:00:00
Last Modified: 2023-12-07
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