Army awards $36.8M contract for 40mm ammunition to American Ordnance LLC
Contract Overview
Contract Amount: $36,836,662 ($36.8M)
Contractor: American Ordnance LLC
Awarding Agency: Department of Defense
Start Date: 2002-09-20
End Date: 2011-12-31
Contract Duration: 3,389 days
Daily Burn Rate: $10.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 200212!001171!2100!AA09 !U.S. ARMY INDUSTRIAL OPERATIONS !DAAA0998G0011 !A!N! !N!0060 !20020920!20040630!037744765!037744765!011148157!N!AMERICAN ORDNANCE LLC, MILAN O!2280 HWY 104, SUITE 2 !MILAN !TN!38358!48680!017!47!MILAN ARMY AMMUNITIO!CARROLL !TENNESSEE !+000001396451!N!N!000000000000!1310!AMMUNITION, OVER 30 MM UP TO 75 MM !A6 !AMMUNITION !1FCN!40MM AMMUNITION ALL TYPES !325920!E! !4! ! ! ! ! !99990909!B! ! !A! !D!N!J!1!001!N!1G!A!N!F! ! !N!C!N! ! ! !Z!A!A!A!000!A!C!N! ! ! ! ! ! !0001!
Place of Performance
Location: MILAN, GIBSON County, TENNESSEE, 38358, UNITED STATES OF AMERICA
Plain-Language Summary
Department of Defense obligated $36.8 million to AMERICAN ORDNANCE LLC for work described as: 200212!001171!2100!AA09 !U.S. ARMY INDUSTRIAL OPERATIONS !DAAA0998G0011 !A!N! !N!0060 !20020920!20040630!037744765!037744765!011148157!N!AMERICAN ORDNANCE LLC, MILAN O!2280 HWY 104, SUITE 2 !MILAN !TN!38358!48680!017!47!MILAN ARMY AMMUNITIO!CARROLL !TENNESSEE !+000001396451!N!N!0… Key points: 1. Contract awarded for 40mm ammunition, a critical component for various military operations. 2. American Ordnance LLC, a single entity, secured the contract, indicating a potentially limited competition landscape. 3. The contract's duration of over 9 years suggests a long-term need for this specific munition. 4. The firm fixed-price contract type aims to control costs for the government.
Value Assessment
Rating: fair
The contract value of $36.8 million over approximately 9 years suggests an average annual spend of around $4 million. Without specific unit volume or detailed cost breakdowns, a precise per-unit cost comparison is difficult. However, the total value appears moderate for a sustained supply of specialized ammunition.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was not competed, suggesting a limited competition scenario. This could be due to specific manufacturing capabilities, existing relationships, or other factors that restricted the pool of potential bidders. The lack of full competition may have impacted price discovery.
Taxpayer Impact: The government is procuring essential ammunition, but the lack of full competition means taxpayers may not have benefited from the lowest possible price achievable through a broader bidding process.
Public Impact
Ensures continued supply of 40mm ammunition for U.S. Army operations. Supports a specific defense contractor, American Ordnance LLC, and its manufacturing capabilities. Potential for long-term reliance on a single supplier for this munition. Impacts readiness and operational capabilities dependent on this ammunition type.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition raises concerns about potential overpricing.
- Long contract duration could lock in potentially suboptimal pricing.
- Lack of transparency in the non-competed award.
Positive Signals
- Ensures a consistent supply of critical ammunition.
- Firm fixed-price contract provides cost certainty.
- Supports domestic defense industrial base.
Sector Analysis
This contract falls within the defense sector, specifically focusing on the procurement of ammunition. Spending benchmarks for ammunition can vary widely based on type, quantity, and geopolitical factors. The $36.8 million total value over nearly a decade represents a sustained investment in a specific munition.
Small Business Impact
There is no indication in the provided data that small businesses were involved as subcontractors or partners in this contract award. The award went to a single, presumably larger, entity, American Ordnance LLC.
Oversight & Accountability
The contract was awarded via a non-competed process, which warrants scrutiny regarding the justification for limiting competition. Oversight would focus on ensuring the pricing is fair and reasonable and that the government's interests were adequately protected despite the lack of competitive bidding.
Related Government Programs
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Lack of full and open competition.
- Potential for non-competitive pricing.
- Long-term contract duration without clear performance metrics.
- Limited transparency on award justification.
Tags
department-of-defense, tn, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $36.8 million to AMERICAN ORDNANCE LLC. 200212!001171!2100!AA09 !U.S. ARMY INDUSTRIAL OPERATIONS !DAAA0998G0011 !A!N! !N!0060 !20020920!20040630!037744765!037744765!011148157!N!AMERICAN ORDNANCE LLC, MILAN O!2280 HWY 104, SUITE 2 !MILAN !TN!38358!48680!017!47!MILAN ARMY AMMUNITIO!CARROLL !TENNESSEE !+000001396451!N!N!000000000000!1310!AMMUNITION, OVER 30 MM UP TO 75 MM !A6 !AMMUNITION !1FCN!40MM AMMUNITION ALL TYPES !325920!E! !4! ! ! ! ! !99990909!B! ! !A! !D!N!J!1!001!N!1G!A!N!F! ! !N!C!N! ! ! !Z!A!A!A!000!A!C!N! ! ! ! ! ! !0001!
Who is the contractor on this award?
The obligated recipient is AMERICAN ORDNANCE 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 $36.8 million.
What is the period of performance?
Start: 2002-09-20. End: 2011-12-31.
What was the specific justification for awarding this contract on a limited/non-competed basis?
The justification for a limited or non-competed contract typically involves factors such as unique capabilities, urgent need, or the unavailability of other sources. For this specific contract, the data does not provide the detailed justification. Further investigation would be required to understand why full and open competition was not pursued, which is crucial for ensuring the government receives the best value.
How does the per-unit cost of this 40mm ammunition compare to similar contracts or market rates?
Without specific unit quantities and detailed cost breakdowns, a precise per-unit cost comparison is not possible from the provided data. The total contract value of $36.8 million over approximately 9 years averages around $4 million annually. Benchmarking would require access to historical data on similar ammunition procurements or current market pricing for comparable munitions.
What is the long-term strategic impact of relying on American Ordnance LLC for this specific ammunition?
A long-term contract with a single supplier like American Ordnance LLC ensures a consistent supply chain for critical 40mm ammunition, bolstering military readiness. However, it also creates a dependency that could pose risks if the supplier faces production issues or if market conditions change. Strategic oversight should include contingency planning and periodic reviews of the supplier's performance and market alternatives.
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 17575 HIGHWAY 79, MIDDLETOWN, IA, 52638
Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Partnership or Limited Liability Partnership
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2002-09-20
Current End Date: 2011-12-31
Potential End Date: 2011-12-31 00:00:00
Last Modified: 2015-12-07
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