DoD Awards BAE Systems $59.5M for RFAAP Workplace Safety Upgrades

Contract Overview

Contract Amount: $59,541,603 ($59.5M)

Contractor: BAE Systems Ordnance Systems Inc

Awarding Agency: Department of Defense

Start Date: 2023-04-05

End Date: 2026-11-03

Contract Duration: 1,308 days

Daily Burn Rate: $45.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: RFAAP WORKPLACE SAFETY UPGRADES

Place of Performance

Location: RADFORD, RADFORD CITY County, VIRGINIA, 24141

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $59.5 million to BAE SYSTEMS ORDNANCE SYSTEMS INC for work described as: RFAAP WORKPLACE SAFETY UPGRADES Key points: 1. Significant investment in critical safety infrastructure at the Radford Army Ammunition Plant. 2. BAE Systems, a major defense contractor, secured the award. 3. Potential risks include project delays and cost overruns in complex facility upgrades. 4. Spending falls within the Facilities Support Services sector.

Value Assessment

Rating: fair

The contract type is Cost Plus Fixed Fee, which can lead to higher costs if not managed tightly. Benchmarking against similar large-scale facility upgrade contracts is difficult without more granular cost data.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, suggesting a competitive bidding process. However, the award type is a Delivery Order, which might indicate it's part of a larger IDIQ or existing contract vehicle, potentially limiting the scope of initial price discovery.

Taxpayer Impact: Taxpayer funds are being utilized for essential safety improvements at a government-owned, contractor-operated facility, aiming to enhance operational safety and compliance.

Public Impact

Enhances worker safety at a key ammunition production facility. Supports the modernization of critical defense industrial base infrastructure. Ensures compliance with stringent safety regulations in hazardous environments.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type can incentivize higher spending.
Lack of detailed cost breakdown makes precise value assessment challenging.
Project complexity in safety upgrades can lead to unforeseen costs.

Positive Signals

Awarded through full and open competition.
Addresses critical workplace safety needs.
Supports national defense industrial base.

Sector Analysis

This contract falls under Facilities Support Services, a broad category encompassing maintenance, repair, and operational support for government facilities. Spending benchmarks for large-scale safety upgrades within ammunition plants are highly specific and not readily available.

Small Business Impact

The awardee, BAE Systems, is a large defense contractor. There is no indication that small businesses were significantly involved in this specific award, suggesting limited direct small business participation.

Oversight & Accountability

Oversight will be crucial given the Cost Plus Fixed Fee structure to ensure costs remain reasonable and the project stays within scope. The Department of Defense's contracting oversight mechanisms will be key to accountability.

Related Government Programs

Facilities Support Services
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Potential for cost overruns due to CPFF structure.
Complexity of integrating new safety systems into existing infrastructure.
Dependence on a single large contractor for critical upgrades.
Limited transparency on detailed cost breakdowns.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $59.5 million to BAE SYSTEMS ORDNANCE SYSTEMS INC. RFAAP WORKPLACE SAFETY UPGRADES

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS ORDNANCE SYSTEMS INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $59.5 million.

What is the period of performance?

Start: 2023-04-05. End: 2026-11-03.

What is the projected return on investment for these safety upgrades in terms of reduced accident rates and associated costs?

The direct ROI in terms of reduced accident rates is difficult to quantify upfront but is expected to be high given the critical nature of safety in ammunition production. Reduced incidents translate to fewer injuries, less downtime, and avoidance of regulatory fines, ultimately saving taxpayer money in the long run.

What are the primary risks associated with the 'Cost Plus Fixed Fee' contract type for this project?

The primary risk with CPFF is that the contractor may not be sufficiently incentivized to control costs, as the government agrees to cover all allowable costs plus a fixed fee. This can lead to cost overruns if the government's oversight is not rigorous in monitoring expenditures and ensuring efficiency.

How effectively will these upgrades improve overall operational efficiency and production capacity at RFAAP?

The upgrades are primarily focused on safety, which is a prerequisite for efficient and continuous operation. By mitigating risks and ensuring compliance, these improvements will likely prevent costly shutdowns and enable more stable, predictable production, indirectly boosting operational efficiency and capacity.

Industry Classification

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

Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Ball Corporation

Address: STATE RT 114, RADFORD, VA, 24141

Business Categories: Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $59,541,603

Exercised Options: $59,541,603

Current Obligation: $59,541,603

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: W52P1J11G0002

IDV Type: BOA

Timeline