Alliant Techsystems Operations LLC awarded $310.8M for LCAAP Production, Delivery Order 0001

Contract Overview

Contract Amount: $310,813,440 ($310.8M)

Contractor: Alliant Techsystems Operations LLC

Awarding Agency: Department of Defense

Start Date: 2012-10-01

End Date: 2015-03-31

Contract Duration: 911 days

Daily Burn Rate: $341.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Defense

Official Description: LCAAP PRODUCTION CONTRACT, DELIVERY ORDER 0001 - INITIAL AWARD.

Place of Performance

Location: INDEPENDENCE, JACKSON County, MISSOURI, 64056

State: Missouri Government Spending

Plain-Language Summary

Department of Defense obligated $310.8 million to ALLIANT TECHSYSTEMS OPERATIONS LLC for work described as: LCAAP PRODUCTION CONTRACT, DELIVERY ORDER 0001 - INITIAL AWARD. Key points: 1. Contract awarded via full and open competition, suggesting a competitive pricing environment. 2. Fixed Price with Economic Price Adjustment (FPEPA) contract type introduces potential for cost fluctuations. 3. Delivery Order 0001 represents an initial award, with potential for future orders and spending. 4. The contract duration of 911 days (approx. 2.5 years) indicates a medium-term commitment. 5. The North American Industry Classification System (NAICS) code 332992 points to Small Arms Ammunition Manufacturing. 6. The contract is not set aside for small businesses, nor does it indicate subcontracting plans. 7. The award is managed by the Department of the Army within the Department of Defense.

Value Assessment

Rating: fair

The total award amount of $310.8 million for LCAAP Production, Delivery Order 0001, is a significant investment. Benchmarking this against similar ammunition production contracts would be necessary for a precise value-for-money assessment. The FPEPA pricing structure introduces a degree of uncertainty regarding the final cost, as economic adjustments can increase the total expenditure over the contract's life. Without specific performance metrics or comparisons to industry standards for ammunition manufacturing, it is difficult to definitively assess the value proposition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that all responsible sources were permitted to submit offers. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which can lead to more favorable pricing for the government. The open competition suggests that the government sought the best available solution and price from the market.

Taxpayer Impact: A full and open competition is generally beneficial for taxpayers as it increases the likelihood of obtaining competitive pricing and a wider range of innovative solutions, potentially leading to cost savings and better quality.

Public Impact

The primary beneficiaries are the Department of Defense and its various branches, ensuring the supply of small arms ammunition. The services delivered include the production and manufacturing of small arms ammunition. The contract is managed by the Department of the Army, with the award being associated with Missouri (MO) as a state. The contract supports the defense industrial base and potentially the workforce involved in ammunition manufacturing.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The FPEPA clause introduces risk of cost escalation beyond initial projections.
Lack of specific bidder count in the provided data limits assessment of competitive intensity.
The contract is not a small business set-aside, potentially limiting opportunities for smaller firms in this sector.

Positive Signals

Awarded through full and open competition, suggesting a robust bidding process.
The contract addresses a critical defense need for small arms ammunition.
The fixed-price component provides some cost certainty, albeit with economic adjustments.

Sector Analysis

The defense sector, particularly the manufacturing of munitions and ordnance, is a critical component of national security spending. This contract falls under the Small Arms Ammunition Manufacturing industry, which is characterized by specialized production processes and stringent quality control. The market size for such specialized defense manufacturing can be substantial, driven by military readiness requirements and global defense postures. Comparable spending benchmarks would typically involve analyzing other large-scale ammunition procurement contracts awarded by the Department of Defense or allied nations.

Small Business Impact

This contract was not awarded as a small business set-aside, and there is no explicit indication of subcontracting requirements for small businesses. This means that opportunities for small businesses to directly participate in this specific contract may be limited. The impact on the broader small business ecosystem in the defense manufacturing sector would depend on whether Alliant Techsystems Operations LLC engages small businesses as suppliers or partners in their broader operations, which is not detailed here.

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, delivery schedules, and quality assurance provisions. Transparency is facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

Lethal എന്നാൽ Non-Lethal Ammunition Production
Small Arms Ammunition Production
Ordnance and Ammunition Manufacturing
Department of Defense Ammunition Procurement
Army Ammunition Production Contracts

Risk Flags

Potential for cost escalation due to Economic Price Adjustment clause.
Limited transparency on the number of bidders in the full and open competition.
No explicit small business subcontracting requirements mentioned.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $310.8 million to ALLIANT TECHSYSTEMS OPERATIONS LLC. LCAAP PRODUCTION CONTRACT, DELIVERY ORDER 0001 - INITIAL AWARD.

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 $310.8 million.

What is the period of performance?

Start: 2012-10-01. End: 2015-03-31.

What is the historical spending pattern for LCAAP Production contracts awarded to Alliant Techsystems Operations LLC?

Analyzing historical spending patterns for LCAAP Production contracts awarded to Alliant Techsystems Operations LLC requires access to historical contract data beyond this single Delivery Order 0001. This specific award represents $310.8 million. To understand the full pattern, one would need to examine previous and subsequent delivery orders under the same basic contract, as well as any other related contracts for LCAAP production. Factors to consider include the total value of awards over time, the frequency of awards, and any significant changes in contract value or scope. Without this broader historical context, it's challenging to identify trends, growth, or decline in spending with this contractor for this specific program.

How does the per-unit cost of ammunition under this contract compare to similar contracts or market rates?

Determining the per-unit cost of ammunition under this contract and comparing it to similar contracts or market rates is complex without detailed unit pricing information. The provided data includes a total award amount and contract type (FPEPA), but not the quantity of ammunition to be produced or the price per unit. To perform such a comparison, one would need to obtain the specific quantities associated with this delivery order and the negotiated unit prices. Subsequently, these would be benchmarked against unit prices from other government contracts for similar types of ammunition, or against commercial market prices if available. The FPEPA clause also complicates direct comparisons, as the final unit cost can fluctuate due to economic adjustments.

What are the key performance indicators (KPIs) for this contract and how has Alliant Techsystems Operations LLC performed against them?

Key performance indicators (KPIs) for a contract like LCAAP Production typically revolve around factors such as on-time delivery, quality of manufactured ammunition (e.g., defect rates, reliability), production output volume, and adherence to safety and environmental standards. The provided data does not specify these KPIs. To assess Alliant Techsystems Operations LLC's performance, one would need to consult contract performance reports, quality assurance records, and any official performance evaluations or contractor past performance information available through government databases. Without access to these specific performance metrics and evaluation data, a definitive assessment of their performance against KPIs cannot be made.

What is the assessed risk level of this contract, considering factors like contract type, duration, and contractor's past performance?

The risk level of this contract can be assessed by considering several factors. The contract type, Fixed Price with Economic Price Adjustment (FPEPA), introduces a moderate risk of cost overruns due to potential economic fluctuations, although it offers some price stability compared to purely cost-plus contracts. The duration of 911 days (approximately 2.5 years) is a medium-term commitment, which is generally manageable. The contractor, Alliant Techsystems Operations LLC, is a known entity in defense contracting, suggesting a level of experience. However, a comprehensive risk assessment would require detailed analysis of the contractor's past performance on similar contracts, including any history of cost overruns, delivery delays, or quality issues. The lack of specific risk flags in the provided data necessitates a broader review of available performance and compliance records.

How does this contract fit within the broader context of the Department of Defense's ammunition procurement strategy?

This contract, Delivery Order 0001 for LCAAP Production, fits within the Department of Defense's (DoD) broader strategy to ensure a consistent and reliable supply of small arms ammunition to meet operational requirements. The DoD procures ammunition through various mechanisms, including competitive contracts like this one, to maintain readiness and support military operations globally. The award to Alliant Techsystems Operations LLC under full and open competition suggests the DoD is leveraging market competition to secure necessary munitions. The specific focus on LCAAP (likely referring to Lake City Army Ammunition Plant or a similar large-scale production capability) indicates a strategic investment in maintaining or expanding domestic production capacity for critical ammunition types, ensuring supply chain resilience and reducing reliance on foreign sources.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Small Arms Ammunition Manufacturing

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation (UEI: 967356127)

Address: HWY 7 & 78 LAKE CITY ARMY AMUNITION PLANT, INDEPENDENCE, MO, 64056

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: $310,813,440

Exercised Options: $310,813,440

Current Obligation: $310,813,440

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W52P1J12D0078

IDV Type: IDC

Timeline