DoD's $16.4M H-60M ADTS Upgrade contract awarded to Defense Systems and Solutions for advanced data transfer capabilities

Contract Overview

Contract Amount: $16,473,679 ($16.5M)

Contractor: Defense Systems and Solutions

Awarding Agency: Department of Defense

Start Date: 2024-07-16

End Date: 2029-05-31

Contract Duration: 1,780 days

Daily Burn Rate: $9.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: H-60M ADVANCED DATA TRANSFER SYSTEM (ADTS) UPGRADE

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35806

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $16.5 million to DEFENSE SYSTEMS AND SOLUTIONS for work described as: H-60M ADVANCED DATA TRANSFER SYSTEM (ADTS) UPGRADE Key points: 1. The contract aims to enhance the data transfer capabilities of the H-60M Black Hawk helicopter fleet. 2. Awarded to Defense Systems and Solutions, a company with a significant presence in defense contracting. 3. The contract duration extends over five years, indicating a long-term need for these upgrades. 4. The pricing structure is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 5. The procurement method, 'Full and Open Competition After Exclusion of Sources,' suggests a specific justification for limiting initial bidders. 6. The contract is for a delivery order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle or a previously established contract.

Value Assessment

Rating: fair

Benchmarking the value of this specific delivery order is challenging without knowing the broader IDIQ contract it falls under or the specific technical requirements. The Cost Plus Fixed Fee (CPFF) pricing structure inherently carries more risk for the government compared to fixed-price contracts, as costs can escalate. However, CPFF is often used for complex R&D or services where cost estimation is difficult. Comparing the $16.4 million total value against the duration of 1780 days (approx. 4.8 years) suggests an average annual spend of roughly $3.4 million, which needs to be evaluated against the scope of work and the criticality of the ADTS upgrade.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This indicates that while the initial solicitation was open, specific sources were excluded, likely due to pre-qualification requirements, existing relationships, or specific technical expertise needed for the upgrade. The exact number of bidders and the rationale for exclusion are not detailed, making it difficult to fully assess the breadth of competition. This procurement approach can sometimes limit price discovery compared to truly open competition.

Taxpayer Impact: The exclusion of certain sources, even after an initial open competition phase, may limit the government's ability to secure the most competitive pricing. Taxpayers benefit when competition is maximized, driving down costs through multiple offers.

Public Impact

The primary beneficiaries are the U.S. Army aviation units operating the H-60M Black Hawk helicopters. The services delivered involve upgrading the Advanced Data Transfer System (ADTS) to improve operational efficiency and data handling. The geographic impact is likely widespread, supporting Army aviation assets across various operational theaters. Workforce implications may include specialized technicians for the upgrade and integration process, as well as enhanced capabilities for pilots and crew.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) pricing can lead to cost overruns if not rigorously managed.
The 'Exclusion of Sources' in the competition phase warrants further investigation into the justification and impact on price.
The specific technical details of the 'ADTS Upgrade' are not publicly detailed, making independent value assessment difficult.

Positive Signals

Award to a known defense contractor, Defense Systems and Solutions, suggests established capabilities.
The upgrade addresses a critical need for enhanced data transfer in modern aviation platforms.
The five-year duration allows for thorough implementation and testing of the upgraded systems.

Sector Analysis

The defense sector, particularly aviation systems, relies heavily on advanced electronics and communication systems. The market for aircraft parts and auxiliary equipment manufacturing (NAICS 336413) is substantial, driven by military modernization programs. This contract fits within the broader trend of upgrading legacy platforms to incorporate modern digital capabilities, ensuring operational relevance and effectiveness. Comparable spending benchmarks would involve looking at other avionics upgrade contracts for similar helicopter platforms, which can range from millions to tens of millions of dollars depending on complexity.

Small Business Impact

This contract does not appear to have a small business set-aside (ss=false, sb=false). The prime contractor, Defense Systems and Solutions, is likely a large business. There is no explicit information provided regarding subcontracting plans for small businesses. Without specific set-aside goals or reporting on subcontracting, the direct impact on the small business ecosystem is unclear, though large prime contractors often utilize small businesses for specialized components or services.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army and potentially the Department of Defense's Inspector General. The Cost Plus Fixed Fee structure necessitates robust financial oversight to ensure costs are reasonable and allocable. Performance monitoring would likely involve tracking milestones, technical progress, and adherence to specifications. Transparency is dependent on the level of detail made public regarding the contract's performance and expenditures.

Related Government Programs

H-60 Black Hawk Helicopter Program
Avionics Modernization Programs
Defense Communication Systems
Military Aircraft Parts Manufacturing

Risk Flags

Potential for cost overruns due to CPFF pricing.
Limited competition due to source exclusion.
Lack of detailed public information on technical scope and performance metrics.
Reliance on a single delivery order under a potentially larger contract vehicle.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.5 million to DEFENSE SYSTEMS AND SOLUTIONS. H-60M ADVANCED DATA TRANSFER SYSTEM (ADTS) UPGRADE

Who is the contractor on this award?

The obligated recipient is DEFENSE SYSTEMS AND SOLUTIONS.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $16.5 million.

What is the period of performance?

Start: 2024-07-16. End: 2029-05-31.

What is the specific nature of the 'Advanced Data Transfer System (ADTS) Upgrade' and its expected performance improvements?

The specific technical details of the H-60M Advanced Data Transfer System (ADTS) Upgrade are not publicly disclosed in detail. However, based on the name and the context of modern military aviation, the upgrade likely focuses on enhancing the speed, security, and capacity of data transmission within the helicopter. This could involve upgrading communication hardware, software, and data storage capabilities to support higher bandwidth requirements for sensor data, mission planning information, and real-time situational awareness feeds. Expected performance improvements would include faster download/upload of mission data, more reliable communication links, and the ability to handle increasingly complex digital information required for modern warfare.

How does the Cost Plus Fixed Fee (CPFF) pricing structure compare to other contract types for similar defense avionics upgrades?

Cost Plus Fixed Fee (CPFF) is a common contract type for complex projects where the scope of work is not fully defined at the outset, or where significant research and development is involved, such as advanced avionics upgrades. Compared to Firm-Fixed-Price (FFP) contracts, CPFF offers more flexibility for the contractor to adapt to unforeseen technical challenges, but it shifts more financial risk to the government, as the final cost is not capped. Fixed-Price Incentive (FPI) contracts offer a middle ground, with shared cost savings and overruns. For routine upgrades or well-defined modifications, FFP is often preferred for better cost certainty. The choice of CPFF here suggests the DoD anticipated significant technical uncertainties or evolving requirements in the ADTS upgrade.

What are the potential risks associated with the 'Full and Open Competition After Exclusion of Sources' procurement method?

The 'Full and Open Competition After Exclusion of Sources' method, while starting with an open solicitation, involves excluding specific potential bidders. This exclusion must be justified, often based on unique capabilities, prior performance, or specific technical requirements that only a limited number of contractors can meet. The primary risk is that by excluding qualified sources, the government may forgo potentially more competitive pricing or innovative solutions that excluded bidders might have offered. It can also raise concerns about fairness and transparency if the exclusion criteria are perceived as overly restrictive or tailored. Thorough documentation and justification are crucial to mitigate these risks and ensure the best value for the government.

What is the historical spending pattern for H-60M Black Hawk helicopter upgrades or similar avionics modernization efforts by the Department of the Army?

Historical spending on H-60M Black Hawk helicopter upgrades and similar avionics modernization efforts by the Department of the Army is substantial and ongoing. The Black Hawk platform has been in service for decades, necessitating continuous upgrades to maintain operational effectiveness. Spending typically involves various contracts for avionics suites, communication systems, sensor integration, and structural enhancements. These contracts often span multiple years and can range from tens of millions to hundreds of millions of dollars in aggregate over the platform's lifecycle. The Army consistently invests in modernizing its rotary-wing fleet to incorporate advancements in navigation, data sharing, survivability, and mission capabilities, making ADTS upgrades a recurring and significant expenditure category.

What is the track record of Defense Systems and Solutions in delivering complex avionics or data transfer system upgrades for military aircraft?

Defense Systems and Solutions (DSS) has a notable track record in providing a range of services and products to the U.S. military, including support for aviation platforms. While specific details on their past performance with H-60M ADTS upgrades are not readily available in public summaries, DSS has been involved in various defense contracting activities, which often include systems integration, hardware/software development, and sustainment support for military equipment. Their experience likely encompasses complex projects requiring adherence to stringent military specifications and performance standards. A deeper dive into their contract history, past performance evaluations, and specific project outcomes would be necessary to fully assess their capabilities for this particular upgrade.

Industry Classification

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

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 631 DISCOVERY DR, HUNTSVILLE, AL, 35806

Business Categories: Alaskan Native Corporation Owned Firm, Category Business, Minority Owned Business, Native American Owned Business, Partnership or Limited Liability Partnership, SBA Certified 8 a Joint Venture, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $16,473,679

Exercised Options: $16,473,679

Current Obligation: $16,473,679

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $9,292,420

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W58RGZ18D0001

IDV Type: IDC

Timeline