Lockheed Martin awarded $30.6M for Army live fire range modernization, a sole-source contract

Contract Overview

Contract Amount: $30,573,036 ($30.6M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2013-03-04

End Date: 2017-12-31

Contract Duration: 1,763 days

Daily Burn Rate: $17.3K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SANG LIVE FIRE RANGE MODERNIZATION.

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32825

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $30.6 million to LOCKHEED MARTIN CORPORATION for work described as: SANG LIVE FIRE RANGE MODERNIZATION. Key points: 1. Contract awarded on a sole-source basis, limiting price competition and potentially increasing costs. 2. The contract duration of 1763 days suggests a significant, long-term project. 3. Fixed-price contract type aims to transfer some cost risk to the contractor. 4. The modernization effort likely aims to improve training capabilities and safety at the range. 5. The awarded amount represents a substantial investment in military infrastructure. 6. No small business set-aside was utilized, indicating potential missed opportunities for smaller firms.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its sole-source nature and the specific nature of live fire range modernization. Without competitive bids, it's difficult to assess if the $30.6 million represents optimal pricing. However, the fixed-price contract type suggests an attempt to control costs. The duration of the contract (nearly 5 years) indicates a significant scope of work, and the awarded amount aligns with large-scale defense infrastructure projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed openly. This typically occurs when only one vendor possesses the necessary capabilities or when urgency dictates a direct award. The lack of competition means there was no opportunity for multiple companies to bid, which can limit price discovery and potentially lead to higher costs for the government compared to a fully competed contract.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding, as the government did not benefit from the downward pressure on prices that multiple offers typically provide.

Public Impact

The primary beneficiaries are the U.S. Army personnel who will utilize the modernized live fire range for training. The contract delivers modernized infrastructure for training, potentially enhancing combat readiness and safety. The geographic impact is localized to the specific Army installation in Florida where the range is located. Workforce implications include potential employment opportunities for Lockheed Martin and its subcontractors in the defense and construction sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing, potentially increasing cost to taxpayers.
Lack of small business participation may limit opportunities for smaller defense contractors.
Long contract duration could present challenges in adapting to evolving technological needs.
Specific details on performance metrics and success criteria are not readily available.

Positive Signals

Fixed-price contract type helps manage cost overruns.
Modernization of critical training infrastructure is a positive development for military readiness.
Award to a major defense contractor like Lockheed Martin suggests capability to handle complex projects.

Sector Analysis

The defense sector, particularly military infrastructure modernization, involves significant capital investment. Contracts for range development and upgrades are crucial for maintaining training effectiveness and safety standards. While specific market size data for live fire range modernization is not readily available, it falls under the broader category of defense construction and equipment manufacturing. Spending in this area is driven by military readiness requirements and technological advancements in weaponry and training simulation.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. The award to a large prime contractor like Lockheed Martin suggests that the primary focus was on capability rather than small business inclusion. This could mean missed opportunities for small businesses to participate in a significant defense project, although they might still be involved as lower-tier subcontractors.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are inherent in the fixed-price contract type, which obligates the contractor to deliver specified goods or services for an agreed-upon price. Transparency is limited by the sole-source nature of the award, but contract performance data and financial reporting would be subject to government review. The Inspector General's office may also conduct audits or investigations if concerns arise regarding waste, fraud, or abuse.

Related Government Programs

Military Base Infrastructure Modernization
Live Fire Training Systems
Defense Construction Contracts
Army Weapons Systems Support
Department of Defense Facilities Management

Risk Flags

Sole-source award
Lack of competition
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.6 million to LOCKHEED MARTIN CORPORATION. SANG LIVE FIRE RANGE MODERNIZATION.

Who is the contractor on this award?

The obligated recipient is LOCKHEED MARTIN CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $30.6 million.

What is the period of performance?

Start: 2013-03-04. End: 2017-12-31.

What is Lockheed Martin's track record with similar range modernization contracts?

Lockheed Martin Corporation is a major defense contractor with extensive experience in various military systems and infrastructure projects. While specific details on their past live fire range modernization contracts are not provided in this data, the company has a broad portfolio that includes electronic warfare systems, aircraft, missiles, and defense services. Their history suggests a capacity to manage large, complex projects. However, without direct comparisons to similar range modernization efforts, it's difficult to definitively assess their performance specifically in this niche. Further investigation into their project history and client feedback on similar infrastructure developments would be necessary for a comprehensive evaluation.

How does the $30.6 million cost compare to other live fire range modernization projects?

Directly comparing the $30.6 million cost of this contract to other live fire range modernization projects is challenging without more specific data on the scope and complexity of those projects. The cost of such modernization can vary significantly based on factors like the size of the range, the types of training capabilities being implemented (e.g., advanced simulation, ballistic containment, environmental controls), and the specific technological upgrades required. Given that this was a sole-source award to Lockheed Martin, it's difficult to establish a competitive benchmark. However, $30.6 million represents a substantial investment, suggesting a significant scope of work or advanced technological integration for the SANG Live Fire Range.

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

The primary risk associated with this sole-source contract is the potential for inflated costs due to the lack of competitive bidding. Without multiple offers, the government may not achieve the most favorable pricing. Another risk is contractor performance; while Lockheed Martin is a reputable firm, any large, long-term project carries inherent risks of delays, cost overruns (even within a fixed-price structure if scope changes), or technical issues. The sole-source nature also means less leverage for the government to negotiate terms if issues arise. Finally, there's a risk that the specific modernization needs might evolve over the contract's nearly five-year duration, potentially leading to change orders or a less-than-optimal final outcome if not managed proactively.

How effective is a fixed-price contract type for this type of modernization project?

A Firm Fixed Price (FFP) contract type, as used here, is generally considered effective for modernization projects when the scope of work is well-defined and understood. It shifts the primary risk of cost overruns to the contractor, incentivizing them to manage their costs efficiently. For a project like live fire range modernization, where the physical requirements might be clearer than, for example, a research and development effort, FFP can provide cost certainty for the government. However, if unforeseen technical challenges or significant scope changes arise, the contractor may seek adjustments, or the government might need to issue change orders, which can add complexity and cost. The effectiveness also depends on the contractor's ability to accurately estimate costs upfront.

What are the historical spending patterns for live fire range modernization by the Department of the Army?

Historical spending patterns for live fire range modernization by the Department of the Army are not detailed in the provided data. However, it is understood that the Army, like other branches of the military, invests significantly in training infrastructure. Modernization efforts are typically driven by the need to enhance training realism, improve safety standards, comply with environmental regulations, and adapt to new weapon systems. Spending in this area can fluctuate based on budget allocations, strategic priorities, and the lifecycle of existing facilities. Large-scale modernization projects, especially those involving significant upgrades or new construction, can represent multi-million dollar investments, as seen in this contract award.

What are the implications of the contract's duration (1763 days) on project success?

The contract duration of 1763 days (approximately 4.8 years) indicates a substantial and complex modernization effort for the SANG Live Fire Range. A long duration can be beneficial by allowing ample time for detailed planning, execution, and testing of upgrades, potentially leading to a more thorough and robust outcome. It also allows the contractor, Lockheed Martin, to plan resources effectively. However, a lengthy period also increases the risk of technological obsolescence, changes in military requirements, or shifts in budget priorities. Effective project management, clear communication, and flexibility to adapt to evolving needs will be crucial for ensuring success over this extended timeframe. Regular performance reviews and milestone tracking will be essential.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Other Commercial and Service Industry Machinery Manufacturing

Product/Service Code: TRAINING AIDS AND DEVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W900KK12R0030

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 100 GLOBAL INNOVATION CIR, ORLANDO, FL, 32825

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

Financial Breakdown

Contract Ceiling: $30,573,036

Exercised Options: $30,573,036

Current Obligation: $30,573,036

Subaward Activity

Number of Subawards: 9

Total Subaward Amount: $2,275,089

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline