DoD's $111.7M Apache Block III Post-Production Support Contract Awarded to Boeing Raises Oversight Questions
Contract Overview
Contract Amount: $111,672,955 ($111.7M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2014-06-30
End Date: 2021-12-31
Contract Duration: 2,741 days
Daily Burn Rate: $40.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: RSLFAC FMS APACHE BLOCK III POST PRODUCTIO SUPPORT
Place of Performance
Location: MESA, MARICOPA County, ARIZONA, 85215
State: Arizona Government Spending
Plain-Language Summary
Department of Defense obligated $111.7 million to THE BOEING COMPANY for work described as: RSLFAC FMS APACHE BLOCK III POST PRODUCTIO SUPPORT Key points: 1. Significant contract value for post-production support of a major defense platform. 2. Sole-source award to Boeing, limiting competitive pricing opportunities. 3. Long contract duration (2741 days) may impact price competitiveness over time. 4. Engineering services sector, critical for maintaining complex military assets.
Value Assessment
Rating: questionable
The contract value of $111.7 million for post-production support is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar engineering services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to The Boeing Company. This lack of competition limits price discovery and may lead to higher costs for taxpayers.
Taxpayer Impact: The absence of competition in this sole-source award means taxpayers may not be receiving the best possible price for these essential engineering services.
Public Impact
Ensures continued operational readiness of the Apache helicopter fleet. Supports high-skilled engineering jobs within the defense industrial base. Potential for cost overruns due to lack of competitive pressure.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
Positive Signals
- Supports critical defense asset
- Long-term support agreement
Sector Analysis
This contract falls under Engineering Services (NAICS 541330), a sector vital for the design, development, and maintenance of complex systems like military aircraft. Spending in this area is often substantial due to the technical expertise required.
Small Business Impact
The data does not indicate any specific provisions or awards made to small businesses under this contract. The sole-source nature suggests a direct award to a large prime contractor.
Oversight & Accountability
The sole-source nature of this contract warrants close oversight to ensure fair pricing and prevent potential cost creep. Robust performance monitoring by the Department of the Army is crucial.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award lacks competition
- Potential for inflated pricing
- Long contract duration may mask inefficiencies
- Limited transparency on cost justification
Tags
engineering-services, department-of-defense, az, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $111.7 million to THE BOEING COMPANY. RSLFAC FMS APACHE BLOCK III POST PRODUCTIO SUPPORT
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $111.7 million.
What is the period of performance?
Start: 2014-06-30. End: 2021-12-31.
What was the justification for awarding this contract on a sole-source basis rather than seeking competitive bids?
Sole-source awards are typically justified when only one responsible source can provide the required supplies or services, often due to unique capabilities, proprietary technology, or urgent needs. For this Apache support contract, the justification likely stems from Boeing's unique knowledge and role in the Apache program's production and sustainment lifecycle.
How does the lack of competition potentially impact the long-term cost-effectiveness of this support contract?
Without competitive pressure, there is a reduced incentive for the contractor to offer the most cost-effective solutions. This can lead to higher prices for parts, labor, and overhead over the contract's duration. The government may end up paying a premium for services that could potentially be procured at a lower cost through a competitive process.
What mechanisms are in place to ensure the effectiveness and quality of the engineering services provided under this sole-source contract?
Despite the sole-source nature, the Department of the Army should have robust contract management and quality assurance surveillance plans. These include performance metrics, regular reviews, and technical inspections to ensure the services meet specified requirements and maintain the operational readiness of the Apache fleet.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W58RGZ13R0305
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 5000 E MCDOWELL RD, MESA, AZ, 85215
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $159,086,825
Exercised Options: $111,672,955
Current Obligation: $111,672,955
Subaward Activity
Number of Subawards: 28
Total Subaward Amount: $15,493,087
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2014-06-30
Current End Date: 2021-12-31
Potential End Date: 2021-12-31 12:12:00
Last Modified: 2021-08-12
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