DoD's $163M contract for rotational mission support at JMRC awarded to Vertex Aerospace LLC

Contract Overview

Contract Amount: $162,888,441 ($162.9M)

Contractor: Vertex Aerospace LLC

Awarding Agency: Department of Defense

Start Date: 2019-05-01

End Date: 2025-01-15

Contract Duration: 2,086 days

Daily Burn Rate: $78.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ROTATIONAL MISSION SUPPORT FOR ANNUAL TRAINING ROTATIONS AT THE JOINT MULTINATIONAL READINESS CENTER.

Plain-Language Summary

Department of Defense obligated $162.9 million to VERTEX AEROSPACE LLC for work described as: ROTATIONAL MISSION SUPPORT FOR ANNUAL TRAINING ROTATIONS AT THE JOINT MULTINATIONAL READINESS CENTER. Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of 2086 days (approx. 5.7 years) indicates a long-term need for these services. 3. Vertex Aerospace LLC, the sole awardee, will provide rotational mission support, a critical function for military readiness. 4. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 5. No small business set-aside was utilized, indicating the primary competition was not restricted to small businesses. 6. The North American Industry Classification System (NAICS) code 541330 points to Engineering Services, a broad category.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific service details and comparable contract data. The total value of over $162 million spread across nearly six years suggests a significant investment in maintaining training readiness. The firm fixed-price structure is generally favorable for the government when scope is well-defined, but potential for cost overruns exists if unforeseen issues arise. The price per day is approximately $78,000, which needs to be evaluated against the specific services rendered.

Cost Per Unit: $78,087 per day (approximate)

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 3 bids suggests a moderate level of competition for this requirement. While multiple bidders participated, the specific number is relatively low for a contract of this magnitude, which could imply barriers to entry or a specialized market.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to better pricing and service quality. However, with only three bidders, the potential for significant price reductions may have been limited compared to a more crowded field.

Public Impact

The primary beneficiaries are the U.S. Army personnel who utilize the Joint Multinational Readiness Center (JMRC) for essential training. The contract ensures the continuous operation and support of training rotations, directly impacting military readiness and operational effectiveness. Services provided are crucial for simulating complex operational environments, enhancing soldier preparedness for real-world missions. Geographic impact is concentrated at the JMRC facility, likely located in a specific training area, but the implications for readiness are national. Workforce implications include direct and indirect employment opportunities for personnel involved in supporting the JMRC operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in long-term engineering services contracts if requirements are not tightly managed.
Reliance on a single contractor for critical mission support could pose risks if performance issues arise.
The specific nature of 'rotational mission support' requires detailed understanding to ensure value for money is maximized.

Positive Signals

Awarded through full and open competition, indicating a structured procurement process.
Firm Fixed Price contract type helps control costs and shifts risk to the contractor.
Long contract duration suggests a stable, ongoing requirement that the contractor is positioned to meet.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), which encompasses firms providing specialized engineering expertise. The defense sector heavily relies on such services for maintaining operational readiness, developing new technologies, and supporting complex training environments like the JMRC. The market for defense engineering services is substantial, with significant government spending allocated annually. Comparable spending benchmarks would typically involve other large-scale support contracts for military training facilities or complex operational simulations.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (SB=false) and there is no indication of subcontracting plans being a primary focus (ST=''). This suggests that the competition was likely geared towards larger, established firms capable of handling the scale and complexity of the requirement. Consequently, the direct impact on the small business ecosystem may be limited, although larger prime contractors often engage small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. Accountability measures are typically embedded within the contract terms, including performance standards, reporting requirements, and potential remedies for non-performance. Transparency is facilitated through contract award databases like FPDS, which provide basic information on contract value, duration, and awardee. Inspector General (IG) jurisdiction would apply if allegations of fraud, waste, or abuse arise.

Related Government Programs

Military Training Support Services
Base Operations Support
Defense Engineering Services
Readiness and Training Programs
Joint Multinational Readiness Center Operations

Risk Flags

Long-term contract duration increases risk of cost escalation or performance degradation if not managed proactively.
Limited number of bidders may reduce competitive pressure on pricing.
Lack of detailed service scope in summary data hinders precise value-for-money assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $162.9 million to VERTEX AEROSPACE LLC. ROTATIONAL MISSION SUPPORT FOR ANNUAL TRAINING ROTATIONS AT THE JOINT MULTINATIONAL READINESS CENTER.

Who is the contractor on this award?

The obligated recipient is VERTEX AEROSPACE LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $162.9 million.

What is the period of performance?

Start: 2019-05-01. End: 2025-01-15.

What specific engineering services are included under 'rotational mission support' for the JMRC?

The provided data does not detail the specific engineering services encompassed by 'rotational mission support.' Typically, such support at a major training facility like the JMRC could involve a wide range of activities. This might include the maintenance and operation of simulation systems, development and upkeep of training environments (e.g., ranges, mock villages), logistical support for training exercises, technical support for communication and IT infrastructure, and potentially specialized engineering consulting for exercise design or scenario development. Without further details from the contract statement of work, it's difficult to ascertain the precise nature and scope of the engineering services provided, making a granular value assessment challenging.

How does the $78,087 per diem cost compare to similar military training support contracts?

The approximate per diem cost of $78,087 for this contract requires careful comparison. Benchmarking this figure against similar contracts is complex due to variations in service scope, geographic location, and contract type. However, for large-scale military training support, costs can range significantly. Contracts for operating major training ranges or providing comprehensive simulation support often involve substantial infrastructure, technology, and personnel costs. To provide a precise comparison, one would need to identify contracts with highly similar service offerings, duration, and operational tempo. Factors such as the level of technological sophistication, the number of personnel supported, and the specific training scenarios being facilitated would heavily influence the per diem rate. A preliminary assessment suggests this rate is substantial and warrants detailed scrutiny against comparable, publicly available data.

What is Vertex Aerospace LLC's track record with similar large-scale defense support contracts?

Vertex Aerospace LLC's track record with large-scale defense support contracts is a key factor in assessing the risk and value of this award. While the provided data identifies Vertex Aerospace LLC as the awardee, it does not offer insights into their past performance history, particularly on contracts of this magnitude or nature. A thorough analysis would require examining their contract portfolio, including past performance evaluations, any history of contract disputes or terminations, and their experience in providing rotational mission support or similar services at major training installations. Understanding their operational capacity, financial stability, and demonstrated ability to meet performance requirements is crucial for ensuring the successful execution of this nearly $163 million contract over its multi-year duration.

What are the potential risks associated with a 5.7-year Firm Fixed Price contract for mission support?

A Firm Fixed Price (FFP) contract, while beneficial for cost control, carries specific risks over a long duration like 5.7 years, especially for complex mission support. One primary risk is contractor underestimation of costs, leading to potential performance degradation if the contractor seeks to cut corners to maintain profitability. Conversely, if the contractor accurately anticipates future cost increases (e.g., labor, materials) and prices them in, the government might end up paying a premium. Scope creep is another significant risk; if the requirements evolve or expand beyond the initial definition, managing changes under an FFP structure can lead to disputes or costly change orders. Furthermore, if unforeseen technical challenges or external factors (e.g., regulatory changes, geopolitical events impacting operations) arise, the contractor may struggle to adapt within the fixed-price constraint, potentially impacting the continuity and quality of the mission support.

How does the level of competition (3 bidders) impact the government's leverage in negotiating terms and pricing?

The level of competition, with three bidders for this contract, provides the government with some leverage, but it is less than what would be expected in a market with numerous participants. Three bidders suggest a moderately competitive environment where offerors are aware of potential rivals. This typically encourages competitive pricing and service offerings. However, it also means that the government is reliant on these three entities, and if one or two are disqualified or withdraw, the remaining bidder(s) might have increased negotiating power. For a contract of this scale and specialized nature, the pool of qualified bidders might inherently be limited. Therefore, while competition exists, the government's ability to drive down prices significantly might be constrained compared to a scenario with, for example, five or more strong contenders actively vying for the award.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W900KK19R0020

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 555 INDUSTRIAL DR S, MADISON, MS, 39110

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

Financial Breakdown

Contract Ceiling: $207,713,445

Exercised Options: $202,600,593

Current Obligation: $162,888,441

Subaward Activity

Number of Subawards: 15

Total Subaward Amount: $563,775,006

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline