Department of Defense awards $22.3M engineering services contract to Oshkosh Corp, highlighting potential value concerns
Contract Overview
Contract Amount: $22,332,689 ($22.3M)
Contractor: Oshkosh Corp
Awarding Agency: Department of Defense
Start Date: 2006-09-12
End Date: 2010-08-31
Contract Duration: 1,449 days
Daily Burn Rate: $15.4K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Place of Performance
Location: OSHKOSH, WINNEBAGO County, WISCONSIN, 54902
Plain-Language Summary
Department of Defense obligated $22.3 million to OSHKOSH CORP for work described as: Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, which can lead to cost overruns. 2. Sole-source award limits price discovery and potentially increases costs for taxpayers. 3. Contract duration of over 4 years suggests a long-term need for these services. 4. The engineering services sector is competitive, raising questions about the necessity of a sole-source award. 5. Performance context is limited due to the lack of competition and publicly available performance metrics. 6. Oshkosh Corp's involvement suggests a focus on specialized engineering capabilities within the defense sector.
Value Assessment
Rating: questionable
The contract's cost-plus-fixed-fee structure, combined with a sole-source award, raises concerns about value for money. Without competitive bidding, it is difficult to benchmark pricing against market rates or similar contracts. The lack of transparency in how the final cost was determined makes a definitive value assessment challenging. Further analysis would be needed to understand if the fixed fee adequately incentivized cost control.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning there was no open competition. This approach is typically used when only one vendor can provide the required goods or services due to unique capabilities, proprietary technology, or urgent needs. The absence of multiple bidders means that price negotiation was not informed by market competition, potentially leading to a higher price than if multiple firms had competed.
Taxpayer Impact: Sole-source awards can result in taxpayers paying a premium, as the government lacks the leverage that competition provides to secure the best possible price.
Public Impact
The primary beneficiary is the Department of Defense, receiving specialized engineering services. Services delivered likely support military readiness and operational capabilities. Geographic impact is centered around the contractor's location in Wisconsin and defense installations. Workforce implications include employment for engineers and technical staff at Oshkosh Corp.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contract type can incentivize higher spending.
- Sole-source award limits competitive pressure on pricing.
- Lack of detailed performance metrics makes value assessment difficult.
- Long contract duration may not reflect evolving needs or market conditions.
Positive Signals
- Award to Oshkosh Corp, a known defense contractor, suggests established capabilities.
- Engineering services are critical for defense modernization and maintenance.
- Contract duration indicates a sustained requirement for specialized expertise.
Sector Analysis
The engineering services sector is broad, encompassing design, consulting, and technical support across various industries. Within the defense sector, engineering services are crucial for developing, maintaining, and upgrading complex military systems and infrastructure. Comparable spending benchmarks are difficult to establish without more specific details on the services rendered, but the overall market for defense engineering services is substantial, driven by continuous technological advancement and operational demands.
Small Business Impact
This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is no information provided regarding subcontracting plans for small businesses. This suggests that the primary contractor, Oshkosh Corp, will likely perform the majority of the work, with limited direct benefit to the small business ecosystem through this specific award.
Oversight & Accountability
Oversight mechanisms for this contract would typically involve contract officers, program managers, and potentially the Department of Defense's Inspector General. Accountability measures would be tied to the terms of the cost-plus-fixed-fee agreement and the delivery of specified engineering services. Transparency is limited due to the sole-source nature and the proprietary aspects of engineering work, making public scrutiny of cost and performance challenging.
Related Government Programs
- Defense Engineering Services
- Military Vehicle Development
- Aerospace Engineering Support
- Naval Architecture and Marine Engineering
- Systems Engineering
Risk Flags
- Sole-source award may limit price competition.
- Cost-plus-fixed-fee contract type carries inherent cost overrun risk.
- Limited public data on specific services and performance outcomes.
- Long contract duration requires ongoing value assessment.
Tags
defense, department-of-defense, department-of-the-army, engineering-services, definitive-contract, cost-plus-fixed-fee, sole-source, oshkosh-corp, wisconsin, large-contract, professional-services
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $22.3 million to OSHKOSH CORP. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is OSHKOSH CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $22.3 million.
What is the period of performance?
Start: 2006-09-12. End: 2010-08-31.
What specific engineering services were procured under this contract?
The provided data indicates the contract falls under the 'Engineering Services' category (NAICS 541330). However, the specific nature of these services is not detailed. Typically, engineering services in the defense context can range from conceptual design and feasibility studies to detailed design, systems integration, testing, and technical support for military platforms, equipment, or infrastructure. Given the award to Oshkosh Corp, known for its military vehicle manufacturing, the services might relate to vehicle design, modification, or sustainment engineering. Without further documentation, the precise scope remains unspecified.
How does the contract's cost-plus-fixed-fee structure compare to other defense engineering contracts?
Cost-plus-fixed-fee (CPFF) contracts are common in defense procurement, especially for research, development, and complex services where the final cost is uncertain at the outset. In a CPFF contract, the contractor is reimbursed for allowable costs plus a predetermined fixed fee representing profit. Compared to fixed-price contracts, CPFF offers flexibility but carries a higher risk of cost overruns for the government if not managed diligently. Benchmarking this specific contract's fee against similar defense engineering services would require access to detailed cost breakdowns and fee structures of comparable sole-source or competed contracts, which are not publicly available in this dataset.
What are the potential risks associated with a sole-source award for engineering services?
The primary risk of a sole-source award is the lack of price competition, which can lead to inflated costs for the government. Without competing bids, there is less incentive for the contractor to offer the most competitive price. Additionally, it limits the government's ability to explore innovative solutions or alternative approaches that other firms might offer. There's also a risk that the selected contractor may not have the most efficient processes or the best value proposition compared to the broader market. Ensuring fair and reasonable pricing and robust oversight becomes even more critical in sole-source situations.
What is Oshkosh Corp's track record with the Department of Defense?
Oshkosh Corporation has a significant and long-standing track record as a supplier to the Department of Defense, particularly known for its production of tactical wheeled vehicles, including the Family of Medium Tactical Vehicles (FMTV) and the Joint Light Tactical Vehicle (JLTV). Their involvement spans decades, encompassing design, manufacturing, and support services. This history suggests a deep understanding of military requirements and a proven capability to deliver complex defense systems. However, specific performance metrics or past issues related to engineering services contracts would require a deeper dive into contract performance reports and historical data.
How does the contract duration of over four years impact its overall value?
A contract duration of approximately four years (1449 days) for engineering services suggests a sustained, long-term requirement. While this provides stability for the contractor and ensures continuity of services for the agency, it also means that potential cost increases over the contract's life are significant. From a value perspective, a longer duration can be beneficial if it allows for deeper integration, knowledge transfer, and economies of scale. However, it also locks the government into a specific provider and potentially limits its ability to adapt to new technologies or market shifts that might offer better value or solutions over time. Regular reviews and performance assessments are crucial to ensure continued value throughout the extended period.
Are there any known performance issues or concerns related to this specific contract?
The provided data does not contain specific details regarding performance issues or concerns for this particular contract. As it was awarded on a sole-source basis and the data is limited, public information on performance is scarce. Typically, performance issues would be documented in contract performance reports, CPARS (Contractor Performance Assessment Reporting System), or through Inspector General investigations. Without access to these detailed records, it is impossible to ascertain any specific performance problems associated with this $22.3 million engineering services contract awarded to Oshkosh Corp.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: RESEARCH AND DEVELOPMENT › ECONOMIC GROWTH/PRODUCTIVITY R&D
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 2307 OREGON ST, OSHKOSH, WI, 54902
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2006-09-12
Current End Date: 2010-08-31
Potential End Date: 2010-08-31 00:00:00
Last Modified: 2018-08-02
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