DoD's $238M Air Transportation Support Contract Awarded to Northrop Grumman Faces Scrutiny
Contract Overview
Contract Amount: $238,252,238 ($238.3M)
Contractor: Northrop Grumman Technical Services, Inc.
Awarding Agency: Department of Defense
Start Date: 2010-10-14
End Date: 2021-09-30
Contract Duration: 4,004 days
Daily Burn Rate: $59.5K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: COST NO FEE
Sector: Defense
Official Description: PROGRAM OFFICE REQUEST.
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20171
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $238.3 million to NORTHROP GRUMMAN TECHNICAL SERVICES, INC. for work described as: PROGRAM OFFICE REQUEST. Key points: 1. Significant contract value of $238.25 million over 10 years. 2. Awarded under full and open competition, suggesting potential for competitive pricing. 3. Long duration (10 years) may introduce risks related to evolving technology and needs. 4. The 'Other Support Activities for Air Transportation' sector is critical for military readiness.
Value Assessment
Rating: fair
The contract's total value is substantial. Without specific per-unit cost data or benchmarks for 'Other Support Activities for Air Transportation,' a precise value assessment is difficult. The Cost No Fee (CNF) pricing structure might limit contractor incentive for cost efficiency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, which typically fosters competitive pricing. However, the long duration and specific nature of the services could still lead to price escalation over time if not managed closely.
Taxpayer Impact: Taxpayer funds are being utilized for essential air transportation support services. While competition is intended to ensure fair pricing, the significant total value warrants ongoing monitoring for cost-effectiveness.
Public Impact
Ensures critical support for Air Force air transportation operations. Long-term contract provides stability for service provider and government planning. Potential for cost overruns or inefficiencies due to long duration and CNF structure.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (10 years)
- Cost No Fee (CNF) pricing structure
- Lack of specific per-unit cost benchmarks
Positive Signals
- Awarded under full and open competition
- Critical support for national defense
Sector Analysis
This contract falls within the broader aerospace and defense sector, specifically focusing on support services for air transportation. Benchmarks for similar long-term support contracts can vary widely based on scope and complexity.
Small Business Impact
The data does not indicate any specific provisions or set-asides for small businesses in this contract. The prime contractor, Northrop Grumman, is a large defense contractor, suggesting limited direct opportunities for small businesses as prime recipients.
Oversight & Accountability
The long duration of this contract necessitates robust oversight from the Department of the Air Force to ensure performance standards are met and costs remain controlled. Regular performance reviews and audits are crucial for accountability.
Related Government Programs
- Other Support Activities for Air Transportation
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Long contract duration
- Cost No Fee (CNF) pricing
- Potential for scope creep
- Lack of specific performance benchmarks in provided data
- Limited visibility into small business participation
Tags
other-support-activities-for-air-transpo, department-of-defense, va, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $238.3 million to NORTHROP GRUMMAN TECHNICAL SERVICES, INC.. PROGRAM OFFICE REQUEST.
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN TECHNICAL SERVICES, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $238.3 million.
What is the period of performance?
Start: 2010-10-14. End: 2021-09-30.
What specific metrics are used to measure the value and effectiveness of 'Other Support Activities for Air Transportation' under this contract?
The effectiveness of 'Other Support Activities for Air Transportation' is typically measured through key performance indicators (KPIs) related to operational availability, response times, maintenance turnaround times, and adherence to safety and regulatory standards. Specific metrics would be detailed in the contract's performance work statement (PWS) and would likely include metrics like aircraft mission capable rates, fuel efficiency, and logistical support responsiveness.
What are the primary risks associated with the Cost No Fee (CNF) pricing structure over a 10-year period?
The primary risk of a CNF structure over a decade is the potential lack of contractor incentive to control costs or improve efficiency, as the government bears all costs regardless of the contractor's performance. This can lead to cost overruns and reduced value for taxpayer money. Additionally, it shifts the burden of cost management and oversight heavily onto the government contracting officers.
How does the 'full and open competition' method ensure long-term cost-effectiveness for this extensive air transportation support contract?
Full and open competition initially aims to secure the best possible price by allowing all responsible sources to submit proposals. For long-term contracts, however, its effectiveness in ensuring sustained cost-effectiveness depends on the contract type, pricing mechanisms, and ongoing oversight. While it sets a competitive baseline, mechanisms like price adjustments, performance incentives, and vigilant government management are crucial to prevent cost creep over the 10-year duration.
Industry Classification
NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: COST NO FEE (S)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
Address: 2411 DULLES CORNER PARK STE 800, HERNDON, VA, 20171
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $238,252,238
Exercised Options: $238,252,238
Current Obligation: $238,252,238
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA810610D0001
IDV Type: IDC
Timeline
Start Date: 2010-10-14
Current End Date: 2021-09-30
Potential End Date: 2021-09-30 00:00:00
Last Modified: 2021-06-21
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