DoD Awards BAE Systems $30.1M for Radford Army Ammunition Plant Process Improvements

Contract Overview

Contract Amount: $30,106,577 ($30.1M)

Contractor: BAE Systems Ordnance Systems Inc

Awarding Agency: Department of Defense

Start Date: 2022-09-29

End Date: 2026-11-30

Contract Duration: 1,523 days

Daily Burn Rate: $19.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: TASK ORDER UNDER BASIC ORDERING AGREEMENT W52P1J-11-G-0002 INCORPORATES A REQUIREMENT FOR NAC/SAC PROCESS IMPROVEMENTS AT THE RADFORD ARMY AMMUNITION PLANT.

Place of Performance

Location: RADFORD, RADFORD CITY County, VIRGINIA, 24141

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $30.1 million to BAE SYSTEMS ORDNANCE SYSTEMS INC for work described as: TASK ORDER UNDER BASIC ORDERING AGREEMENT W52P1J-11-G-0002 INCORPORATES A REQUIREMENT FOR NAC/SAC PROCESS IMPROVEMENTS AT THE RADFORD ARMY AMMUNITION PLANT. Key points: 1. Contract awarded to BAE Systems Ordnance Systems Inc. for facilities support services. 2. The task order is under a Basic Ordering Agreement, indicating a pre-established relationship. 3. The contract value is substantial at $30.1 million, requiring careful oversight. 4. Focus on process improvements at a critical defense facility.

Value Assessment

Rating: good

The contract value of $30.1 million for facilities support services appears reasonable given the scope of process improvements at a large ammunition plant. Benchmarking against similar large-scale facility management contracts would provide further context.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process. This method is generally expected to yield fair pricing and optimal value for the government.

Taxpayer Impact: The $30.1 million expenditure represents taxpayer investment in enhancing the operational efficiency and safety of a key defense asset.

Public Impact

Enhances operational efficiency and safety at Radford Army Ammunition Plant. Supports national defense readiness through infrastructure and process improvements. Potential for long-term cost savings through optimized processes.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type can incentivize cost overruns if not closely monitored.
Long contract duration (over 4 years) requires sustained oversight.

Positive Signals

Awarded under full and open competition.
Focus on process improvements suggests potential for efficiency gains.
Supports critical defense infrastructure.

Sector Analysis

This contract falls under facilities support services, a broad category often involving maintenance, repair, and operational improvements for government installations. Spending in this sector is crucial for maintaining infrastructure supporting various government functions, including defense.

Small Business Impact

The data indicates this contract was not awarded to a small business. Further analysis would be needed to determine if subcontracting opportunities were made available to small businesses.

Oversight & Accountability

Given the contract value and duration, robust oversight from the Department of the Army is essential. This includes monitoring performance, costs, and ensuring adherence to the fixed-fee structure to prevent potential overruns.

Related Government Programs

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

Risk Flags

Cost Plus Fixed Fee contract type.
Long contract duration.
Potential for scope creep in process improvement initiatives.
Lack of specific performance metrics in provided data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.1 million to BAE SYSTEMS ORDNANCE SYSTEMS INC. TASK ORDER UNDER BASIC ORDERING AGREEMENT W52P1J-11-G-0002 INCORPORATES A REQUIREMENT FOR NAC/SAC PROCESS IMPROVEMENTS AT THE RADFORD ARMY AMMUNITION PLANT.

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 $30.1 million.

What is the period of performance?

Start: 2022-09-29. End: 2026-11-30.

What specific process improvements are being targeted, and what are the projected efficiency gains or cost savings?

The specific process improvements are not detailed in the provided data. However, the objective is likely to enhance operational efficiency, safety, and potentially reduce long-term maintenance or production costs at the Radford Army Ammunition Plant. Quantifiable metrics for projected gains would typically be part of the contract's performance work statement and require ongoing monitoring.

What are the key risks associated with a Cost Plus Fixed Fee contract for process improvements in a defense facility?

A primary risk with Cost Plus Fixed Fee (CPFF) contracts is that the contractor may have less incentive to control costs compared to fixed-price contracts, as costs are reimbursed. While the fixed fee provides a profit ceiling, potential for scope creep or inefficient practices exists if oversight is not rigorous. For process improvements, defining the scope and measuring success can also be challenging, increasing risk.

How does this investment contribute to the overall effectiveness and readiness of the Radford Army Ammunition Plant?

By investing in process improvements, this contract aims to enhance the plant's operational effectiveness, potentially leading to increased production capacity, improved safety records, and reduced downtime. These enhancements directly contribute to the plant's readiness to fulfill its mission in supporting national defense requirements.

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: $30,106,577

Exercised Options: $30,106,577

Current Obligation: $30,106,577

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: W52P1J11G0002

IDV Type: BOA

Timeline