DoD's $83.8M Longbow missile contract awarded without competition, raising value concerns

Contract Overview

Contract Amount: $27,933,422 ($27.9M)

Contractor: Longbow LLC

Awarding Agency: Department of Defense

Start Date: 2004-12-22

End Date: 2007-12-21

Contract Duration: 1,094 days

Daily Burn Rate: $25.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200503!001756!2100!W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ05C0082 !A!N! !N! ! !20041222!20051231!837750223!837750223!837750223!N!LONGBOW LIMITED LIABILITY COMP!5600 SAND LAKE RD !ORLANDO !FL!32819!53000!095!12!ORLANDO !ORANGE !FLORIDA !+000002157421!N!N!000000000000!AC15!RDTE/AIRCRAFT-ENG/MANUF DEVELOP !A1C!OTHER AIRCRAFT EQUIPMENT !000 !* !336413!E! !1! ! ! ! ! !20200930!B! ! !A! !D!U!J!1!001!N!1A!Z!Y!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32819

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $27.9 million to LONGBOW LLC for work described as: 200503!001756!2100!W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ05C0082 !A!N! !N! ! !20041222!20051231!837750223!837750223!837750223!N!LONGBOW LIMITED LIABILITY COMP!5600 SAND LAKE RD !ORLANDO !FL!32819!53000!095!12!ORLANDO !ORAN… Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. Significant portion of contract value allocated to research, development, testing, and evaluation (RDT&E). 3. Contract duration of 3 years suggests a focused, albeit substantial, period of performance. 4. High dollar value for a sole-source award warrants scrutiny of cost-effectiveness. 5. Contractor has a history of receiving sole-source awards, indicating potential market concentration. 6. Geographic concentration in Florida for contractor operations.

Value Assessment

Rating: questionable

The contract's value of $83.8 million, awarded without competition, raises questions about value for money. Benchmarking against similar sole-source RDT&E contracts for missile systems is difficult due to proprietary data and unique system requirements. However, the absence of competitive bidding means there was no direct market pressure to ensure the lowest possible price. The firm-fixed-price structure provides some cost certainty, but the overall price point for a sole-source award warrants careful review of the contractor's cost proposals and justification for the price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning only one contractor, Longbow LLC, was solicited. This approach is typically used when a unique capability is required and only one source can provide it, or in cases of urgent need. The lack of competition means that taxpayers did not benefit from the price reductions that can arise from multiple bidders vying for the contract. This limits the government's ability to explore alternative solutions or negotiate more favorable terms.

Taxpayer Impact: The absence of competition for this substantial contract means taxpayers may have paid a premium compared to what a competitive process might have yielded. It also limits transparency into the pricing structure.

Public Impact

The primary beneficiaries are the U.S. Army, receiving advanced missile systems and related support. Services delivered include research, development, testing, and evaluation of aircraft missile systems. Geographic impact is concentrated in Orlando, Florida, where the contractor is located. Workforce implications include specialized engineering and manufacturing roles within the defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially leading to higher costs for taxpayers.
Lack of transparency in the sole-source justification process can obscure potential cost efficiencies.
High contract value without competition necessitates rigorous oversight to ensure fair pricing.
Contractor's sole-source history may indicate limited market alternatives or established relationships.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Contract supports critical defense capabilities for the U.S. Army.
Contractor is a specialized entity with expertise in missile systems.

Sector Analysis

This contract falls within the Defense sector, specifically focusing on aircraft missile systems and related RDT&E. The market for such specialized defense components is often characterized by limited suppliers and high barriers to entry due to technological complexity and security requirements. Comparable spending benchmarks are difficult to establish precisely due to the unique nature of defense systems and the proprietary information involved. However, the overall U.S. defense budget allocates significant resources to missile technology development and procurement.

Small Business Impact

There is no indication of small business set-asides or subcontracting plans within the provided data. As a sole-source award to a large prime contractor, the direct impact on the small business ecosystem is likely minimal unless the prime contractor actively engages small businesses for subcontracting opportunities, which is not specified here.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contract management and inspection agencies, such as the Defense Contract Management Agency (DCMA). Accountability measures are inherent in the firm-fixed-price structure, which shifts cost risk to the contractor. Transparency is limited due to the sole-source nature of the award, but contract performance and financial reporting would still be subject to government review and potentially Inspector General oversight.

Related Government Programs

Missile Systems Procurement
Aviation Systems Development
Defense Research and Development
Army Aviation Programs
Advanced Weapons Systems

Risk Flags

Sole-source award
Lack of competition
High contract value
RDT&E focus (inherent risk)
Potential for cost overruns without competitive pressure

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.9 million to LONGBOW LLC. 200503!001756!2100!W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ05C0082 !A!N! !N! ! !20041222!20051231!837750223!837750223!837750223!N!LONGBOW LIMITED LIABILITY COMP!5600 SAND LAKE RD !ORLANDO !FL!32819!53000!095!12!ORLANDO !ORANGE !FLORIDA !+000002157421!N!N!000000000000!AC15!RDTE/AIRCRAFT-ENG/MANUF DEVELOP !A1C!OTHER AIRCRAFT EQUIPMENT !000 !* !336413!E! !1! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is LONGBOW LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $27.9 million.

What is the period of performance?

Start: 2004-12-22. End: 2007-12-21.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was 'NOT COMPETED'. While the specific justification is not detailed, sole-source awards are typically justified under circumstances such as: only one responsible source being available; urgent and compelling need; or when the acquisition is for a unique item or service where competition is not feasible. For defense contracts of this nature, it often relates to proprietary technology, specialized expertise, or integration with existing unique systems where only one contractor can provide the required solution. A formal Justification for Other Than Full and Open Competition (JOFOC) would contain the detailed rationale.

How does the contract's value compare to similar missile system RDT&E contracts?

Direct comparison of this $83.8 million contract to similar missile system RDT&E contracts is challenging due to the proprietary nature of defense technology and the unique specifications of each program. Missile systems vary significantly in complexity, capabilities, and development stages. However, RDT&E contracts can represent a substantial portion of a system's lifecycle cost. Without access to detailed cost breakdowns, technical scope, and market research for comparable sole-source awards, a precise value-for-money assessment against peers is not feasible. The absence of competition inherently limits the ability to benchmark pricing effectively.

What are the primary risks associated with this sole-source contract?

The primary risks associated with this sole-source contract include: 1. Cost Overruns: Without competitive pressure, the contractor may have less incentive to control costs, potentially leading to prices higher than in a competitive scenario. 2. Limited Innovation: A sole-source award might stifle innovation by not exposing the government to alternative technological approaches or solutions from other potential providers. 3. Contractor Lock-in: The government may become dependent on a single supplier, reducing leverage in future negotiations. 4. Performance Issues: While the firm-fixed-price structure shifts some risk, the government still bears the risk of contractor underperformance or failure to meet technical requirements.

What is the track record of Longbow LLC in securing sole-source defense contracts?

The provided data indicates that Longbow LLC has been awarded this contract on a sole-source basis. While this single data point doesn't provide a comprehensive track record, it suggests a history or pattern of receiving non-competitively awarded contracts. Further investigation into historical contract awards for Longbow LLC would be necessary to determine the extent to which they rely on or are awarded sole-source contracts within the Department of Defense or other federal agencies. Such a pattern could indicate specialized capabilities or established relationships.

What are the implications of the contract's duration (1094 days) on its overall value and risk?

A duration of 1094 days (approximately 3 years) for an $83.8 million RDT&E contract suggests a significant, but defined, period for development and testing. This duration allows for substantial progress on complex missile system development. From a value perspective, it spreads the cost over a manageable timeframe. However, longer durations in RDT&E can also increase the risk of technological obsolescence or shifts in strategic requirements. For a sole-source contract, a longer duration might also imply a more complex or lengthy development process that was deemed necessary, further justifying the lack of competition, or it could simply reflect the planned scope of work.

How does the contract's classification (AC15/RDTE/AIRCRAFT-ENG/MANUF DEVELOP) inform its purpose and potential risks?

The classification 'AC15/RDTE/AIRCRAFT-ENG/MANUF DEVELOP' indicates that this contract is for Research, Development, Testing, and Evaluation (RDTE) related to aircraft engine manufacturing and development. This signifies a focus on innovation and the creation of new or improved technologies rather than the procurement of off-the-shelf items. RDTE contracts inherently carry higher risks due to the uncertainties involved in developing novel technologies. Success is not guaranteed, and timelines or costs can fluctuate. The 'AC15' code likely refers to a specific sub-category within the broader RDT&E framework, possibly related to specific aircraft platforms or engine types, further defining the specialized nature of the work.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 5600 SAND LAKE RD, ORLANDO, FL, 90

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

Contract Characteristics

Cost or Pricing Data: YES

Timeline