DoD Awards $65.7M Engineering Services Task Order to Northrop Grumman, Sole-Source
Contract Overview
Contract Amount: $65,665,031 ($65.7M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2008-10-30
End Date: 2009-09-30
Contract Duration: 335 days
Daily Burn Rate: $196.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: NEW TASK ORDER
Place of Performance
Location: HUNTSVILLE, MADISON County, ALABAMA, 35805
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $65.7 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: NEW TASK ORDER Key points: 1. Significant award value of $65.7 million for engineering services. 2. Sole-source award to Northrop Grumman Systems Corporation indicates limited competition. 3. Risk of potentially higher costs due to lack of competitive bidding. 4. Engineering services sector is critical for defense operations.
Value Assessment
Rating: questionable
The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed tightly. Without competitive benchmarks, assessing the pricing reasonableness is difficult, especially given the sole-source nature.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This was a sole-source award, meaning there was no competition. This significantly limits price discovery and potentially leads to higher costs for taxpayers compared to a fully competed contract.
Taxpayer Impact: The lack of competition raises concerns about whether the government achieved the best possible price for these engineering services, potentially impacting taxpayer value.
Public Impact
Taxpayers may not have received the best value due to the sole-source nature of the award. The Department of the Army received critical engineering services, though the cost-effectiveness is uncertain. Northrop Grumman Systems Corporation secured a substantial contract without facing competitive pressure.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost Plus Fixed Fee contract type
- Lack of competition
Positive Signals
- Awarded to a known entity (Northrop Grumman)
- Addresses specific engineering needs for the Army
Sector Analysis
This award falls under Engineering Services (NAICS 541330), a sector vital for defense readiness and technological advancement. Spending in this sector can vary widely based on project complexity and agency needs.
Small Business Impact
The awardee, Northrop Grumman Systems Corporation, is a large business. There is no indication that small businesses were involved in this specific task order, either as prime contractors or subcontractors.
Oversight & Accountability
As a sole-source award, oversight is crucial to ensure costs are controlled and the fixed fee is justified. The Department of the Army is responsible for monitoring performance and expenditures to ensure accountability.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award limits competition and price discovery.
- Cost Plus Fixed Fee contract type carries inherent risk of cost overruns.
- Lack of transparency regarding specific services and sole-source justification.
- Potential for suboptimal value for taxpayer funds due to lack of competition.
Tags
engineering-services, department-of-defense, al, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $65.7 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. NEW TASK ORDER
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $65.7 million.
What is the period of performance?
Start: 2008-10-30. End: 2009-09-30.
What specific engineering services were procured, and why was a sole-source approach deemed necessary?
The data indicates 'Engineering Services' under NAICS 541330. A sole-source justification would typically stem from unique capabilities, urgent needs, or the unavailability of other sources. Without further documentation, the precise services and the rationale for sole-sourcing remain unclear, impacting the assessment of value and necessity.
How does the Cost Plus Fixed Fee structure impact the risk of cost overruns for this sole-source contract?
The Cost Plus Fixed Fee (CPFF) structure means the contractor is reimbursed for allowable costs plus a fixed fee representing profit. For a sole-source contract, the risk of cost overruns is heightened because there's no competitive pressure to optimize costs. The government must rely heavily on robust oversight to scrutinize costs and ensure the fixed fee remains appropriate.
What is the potential taxpayer impact of awarding a $65.7 million contract without competition?
Awarding a contract of this magnitude without competition generally leads to a higher potential cost for taxpayers. Competitive bidding allows for price discovery and incentivizes contractors to offer their best pricing. A sole-source award removes this pressure, potentially resulting in inflated prices and reduced overall value for the government's investment.
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: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 213 WYNN DRIVE, HUNTSVILLE, AL, 35805
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $65,665,031
Exercised Options: $65,665,031
Current Obligation: $65,665,031
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W31P4Q06D0029
IDV Type: IDC
Timeline
Start Date: 2008-10-30
Current End Date: 2009-09-30
Potential End Date: 2009-09-30 00:00:00
Last Modified: 2024-08-09
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