DoD's $20.25M AEGIS BMD contract awarded to Axient LLC shows strong competition and engineering focus

Contract Overview

Contract Amount: $20,254,664 ($20.3M)

Contractor: Axient LLC

Awarding Agency: Department of Defense

Start Date: 2011-06-30

End Date: 2016-06-29

Contract Duration: 1,826 days

Daily Burn Rate: $11.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: TECHNICAL AND ANALYTICAL EXPERTISE NECESSARY TO SUPPORT TECHNOLOGY AND INTEGRATION WITHIN THE AEGIS BALLISTIC MISSILE DEFENSE (AEGIS BMD) PROGRAM AND OTHER RELATED STANDARD MISSILE (SM) PROGRAMS.

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22202

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $20.3 million to AXIENT LLC for work described as: TECHNICAL AND ANALYTICAL EXPERTISE NECESSARY TO SUPPORT TECHNOLOGY AND INTEGRATION WITHIN THE AEGIS BALLISTIC MISSILE DEFENSE (AEGIS BMD) PROGRAM AND OTHER RELATED STANDARD MISSILE (SM) PROGRAMS. Key points: 1. Contract focuses on critical technical and analytical expertise for the AEGIS Ballistic Missile Defense program. 2. Awarded via full and open competition, indicating a robust bidding process. 3. The contract duration of 1826 days suggests a long-term need for specialized services. 4. The Cost Plus Fixed Fee (CPFF) pricing structure is common for complex R&D and engineering services. 5. The contractor, Axient LLC, is positioned to provide essential support to advanced missile defense systems. 6. This award represents a significant investment in maintaining and advancing national missile defense capabilities.

Value Assessment

Rating: good

The contract's value of $20.25 million over approximately five years for specialized engineering services appears reasonable given the complexity of the AEGIS BMD program. Benchmarking against similar contracts for advanced defense systems is challenging due to the unique nature of AEGIS BMD, but the pricing structure (CPFF) allows for flexibility while maintaining cost control through a fixed fee. The number of offers received (implied by full and open competition) can also serve as an indirect indicator of competitive pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple qualified vendors were invited to bid. The presence of multiple bidders typically fosters a competitive environment, driving down prices and encouraging innovation. While the exact number of bids isn't specified, the 'full and open' designation implies a broad solicitation, which is generally favorable for price discovery and ensuring the government receives the best value.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that aims to secure specialized engineering services at the most advantageous price. Full and open competition increases the likelihood that funds are used efficiently, avoiding inflated costs that might arise from less competitive solicitations.

Public Impact

The primary beneficiaries are the Department of Defense and the U.S. Navy, ensuring the continued operational effectiveness and advancement of the AEGIS Ballistic Missile Defense system. Services delivered include crucial technical and analytical expertise for technology and integration within AEGIS BMD and related Standard Missile programs. The geographic impact is national, supporting U.S. strategic defense capabilities, with potential implications for deployed naval assets globally. Workforce implications include the employment of highly skilled engineers and technical specialists in the defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can sometimes lead to cost overruns if not managed diligently, although the fixed fee component provides some control.
The specialized nature of AEGIS BMD means that contractor lock-in could be a potential concern if competition diminishes in future procurements.

Positive Signals

Awarded through full and open competition, indicating a healthy market for these specialized services.
The contract duration suggests a stable, long-term need, allowing for workforce stability and knowledge retention.
Axient LLC's focus on technical and analytical expertise aligns directly with the program's critical requirements.

Sector Analysis

The defense engineering services sector is characterized by high barriers to entry, requiring specialized knowledge and security clearances. Contracts like this are vital for maintaining technological superiority in areas such as missile defense. The AEGIS BMD program itself is a cornerstone of U.S. national security, involving complex systems integration and continuous upgrades. Spending in this niche often reflects geopolitical priorities and technological advancements in threat capabilities.

Small Business Impact

This contract does not appear to have a small business set-aside component (ss: false, sb: false). However, the prime contractor, Axient LLC, may engage small businesses as subcontractors to fulfill specific aspects of the work. The extent of small business participation would depend on Axient's subcontracting plan and the specific technical requirements of the delivery orders issued under this contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. The Cost Plus Fixed Fee structure necessitates careful monitoring of costs and performance to ensure adherence to the contract's objectives and budget. Transparency is generally maintained through contract reporting requirements, and the Inspector General for the Department of Defense would have jurisdiction over any potential fraud, waste, or abuse.

Related Government Programs

Ballistic Missile Defense System
Standard Missile Programs
Naval Surface Warfare
Advanced Weapons Systems
Defense Technology Integration

Risk Flags

Potential for cost overruns in CPFF contracts.
Need for continuous government oversight to ensure cost reasonableness.
Reliance on specialized contractor expertise could lead to vendor lock-in if not managed.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.3 million to AXIENT LLC. TECHNICAL AND ANALYTICAL EXPERTISE NECESSARY TO SUPPORT TECHNOLOGY AND INTEGRATION WITHIN THE AEGIS BALLISTIC MISSILE DEFENSE (AEGIS BMD) PROGRAM AND OTHER RELATED STANDARD MISSILE (SM) PROGRAMS.

Who is the contractor on this award?

The obligated recipient is AXIENT LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $20.3 million.

What is the period of performance?

Start: 2011-06-30. End: 2016-06-29.

What is Axient LLC's track record with the AEGIS BMD program or similar complex defense systems?

Axient LLC has a documented history of supporting complex defense programs, including missile defense systems. Their expertise in technical and analytical support is crucial for programs like AEGIS BMD, which require deep understanding of advanced technologies and system integration. While specific details on their AEGIS BMD involvement prior to this contract may require deeper investigation into historical contract data, their designation as a recipient of this significant award suggests a proven capability and a strong existing relationship or demonstrated potential to meet the stringent requirements of the Department of Defense. Their broader portfolio likely includes work on other advanced naval and missile systems, positioning them as a key player in this specialized sector.

How does the $20.25 million value compare to other contracts for AEGIS BMD technical support?

Directly comparing the $20.25 million value requires access to historical and current contract data specifically for AEGIS BMD technical and analytical support. However, considering the program's complexity, long-term nature, and the specialized expertise required, this figure appears to be within a reasonable range for a multi-year contract. Contracts for similar high-level engineering and integration support for major defense platforms often run into tens or hundreds of millions of dollars over their lifecycle. The value is also influenced by the specific scope of work defined in the delivery orders issued under this contract, which can vary significantly.

What are the primary risks associated with this type of Cost Plus Fixed Fee (CPFF) contract?

The primary risk with CPFF contracts is the potential for cost overruns, as the contractor is reimbursed for allowable costs. While the 'fixed fee' component provides a ceiling on the contractor's profit, it doesn't cap the total contract cost. This necessitates robust government oversight to ensure that all costs incurred are reasonable, allocable, and necessary for the contract's performance. Scope creep, where the project's requirements expand beyond the initial agreement without corresponding adjustments to the fee or schedule, is another significant risk. Effective program management and clear communication channels are essential to mitigate these risks.

How effective is the AEGIS Ballistic Missile Defense program in its current role, and how does this contract contribute?

The AEGIS Ballistic Missile Defense (BMD) program is a critical component of U.S. national security, designed to protect against short- to intermediate-range ballistic missile threats. Its effectiveness is continually assessed through simulations, tests, and real-world deployments. This contract directly contributes by providing the essential technical and analytical expertise needed to maintain, upgrade, and integrate new technologies into the AEGIS BMD system. Ensuring the system's reliability, adaptability, and interoperability with other defense assets is paramount, and the specialized support funded by this contract is fundamental to achieving those goals.

What are the historical spending patterns for AEGIS BMD technical support services?

Historical spending on AEGIS BMD technical support has been substantial, reflecting the program's ongoing development and sustainment needs. Over the years, the Department of Defense, particularly the Navy, has allocated significant resources to ensure the system's effectiveness against evolving threats. Spending patterns typically show consistent investment in areas like system integration, software development, testing, and operational analysis. This contract represents a continuation of that investment, focusing on the critical analytical and technical expertise required to keep the AEGIS BMD program at the forefront of missile defense technology. Specific historical figures would require detailed analysis of DoD budget allocations and contract awards over multiple fiscal years.

What is the significance of the 'Engineering Services' (NAICS 541330) classification for this contract?

The NAICS code 541330, 'Engineering Services,' signifies that the primary purpose of this contract is to procure professional engineering expertise. This includes services such as research, design, development, and analysis related to engineering problems. For the AEGIS BMD program, this classification underscores the need for highly specialized engineering knowledge in areas like naval architecture, systems engineering, electrical engineering, and software engineering. It indicates that the contract is focused on the intellectual and technical contributions of engineers rather than the manufacturing or installation of hardware, although those activities may be indirectly supported.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › OTHER RESEARCH/DEVELOPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002411R3077

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1400 CRYSTAL DR STE 800, ARLINGTON, VA, 22202

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Subchapter S Corporation, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $30,137,047

Exercised Options: $26,101,679

Current Obligation: $20,254,664

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4085

IDV Type: IDC

Timeline