DoD awards $18.7M contract for ordnance manufacturing to Alliant Techsystems, a sole-source procurement
Contract Overview
Contract Amount: $18,683,404 ($18.7M)
Contractor: Alliant Techsystems Operations LLC
Awarding Agency: Department of Defense
Start Date: 2009-06-16
End Date: 2011-02-15
Contract Duration: 609 days
Daily Burn Rate: $30.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: IAWS
Place of Performance
Location: MINNEAPOLIS, HENNEPIN County, MINNESOTA, 55442
Plain-Language Summary
Department of Defense obligated $18.7 million to ALLIANT TECHSYSTEMS OPERATIONS LLC for work described as: IAWS Key points: 1. Contract Value: $18.7 million for 'Other Ordnance and Accessories Manufacturing'. 2. Competition: Sole-source award, raising questions about price discovery. 3. Risk: Potential for overpayment due to lack of competition. 4. Sector: Defense manufacturing, specifically ordnance.
Value Assessment
Rating: questionable
The contract type is Cost Plus Fixed Fee, which can lead to higher costs if not carefully managed. Without competitive bidding, it's difficult to assess if the $18.7 million price is reasonable compared to market rates for similar ordnance manufacturing services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor was solicited. This significantly limits price discovery and competition, potentially leading to higher costs for taxpayers.
Taxpayer Impact: The lack of competition in this sole-source award may result in the government paying more than necessary for these ordnance manufacturing services.
Public Impact
Taxpayers may be overpaying for essential ordnance due to the absence of competitive bidding. The Department of Defense relies on this contractor for critical manufacturing capabilities. The sole-source nature of the award could set a precedent for future procurements in this area.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of transparency in pricing
Positive Signals
- Ensures supply of critical ordnance
- Established contractor with known capabilities
Sector Analysis
This contract falls within the defense manufacturing sector, specifically focusing on ordnance production. Spending in this area is critical for national security, but competitive bidding is typically sought to ensure cost-effectiveness.
Small Business Impact
The data does not indicate any specific provisions or considerations for small business participation in this sole-source contract. The award went to a large prime contractor.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure the Department of the Army received fair pricing and that this approach was justified. Further oversight is needed to confirm the necessity of a non-competitive award.
Related Government Programs
- Other Ordnance and Accessories Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award limits competition and price discovery.
- Cost-plus contract type can incentivize higher spending.
- Potential for taxpayer overpayment due to lack of competitive pressure.
- Lack of small business participation noted.
- Contract duration is significant (609 days).
Tags
other-ordnance-and-accessories-manufactu, department-of-defense, mn, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $18.7 million to ALLIANT TECHSYSTEMS OPERATIONS LLC. IAWS
Who is the contractor on this award?
The obligated recipient is ALLIANT TECHSYSTEMS OPERATIONS 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 $18.7 million.
What is the period of performance?
Start: 2009-06-16. End: 2011-02-15.
What was the justification for awarding this contract on a sole-source basis instead of seeking competitive bids?
The justification for a sole-source award typically involves circumstances where only one responsible source can provide the required supplies or services. This could be due to unique capabilities, urgent needs, or specific technological requirements. Without detailed documentation from the agency, it's difficult to ascertain the precise rationale, but it implies a perceived lack of alternatives.
How can the government ensure fair pricing on sole-source contracts, especially for cost-plus fixed-fee arrangements?
Ensuring fair pricing on sole-source contracts involves rigorous negotiation, independent cost analysis, and benchmarking against similar historical contracts or commercial pricing. For cost-plus fixed-fee, the government must scrutinize the estimated costs and the fixed fee to ensure they are reasonable. Robust auditing and oversight are crucial throughout the contract performance period.
What is the long-term impact of relying on sole-source contracts for critical defense manufacturing capabilities?
Long-term reliance on sole-source contracts can stifle innovation and competition within the defense industrial base. It may lead to vendor lock-in, reduced market responsiveness, and potentially higher costs over time. While sometimes necessary for specialized capabilities, it can diminish the government's leverage and the overall health of the sector.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Other Ordnance and Accessories Manufacturing
Product/Service Code: WEAPONS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W911QX09R0003
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Innovation Systems LLC (UEI: 618705925)
Address: 4700 NATHAN LN N, PLYMOUTH, MN, 03
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $19,208,763
Exercised Options: $18,683,404
Current Obligation: $18,683,404
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 2009-06-16
Current End Date: 2011-02-15
Potential End Date: 2011-02-15 00:00:00
Last Modified: 2011-01-04
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