DoD awards $55.7M contract for Iraqi armed helicopter production to Science and Engineering Services, LLC

Contract Overview

Contract Amount: $55,706,337 ($55.7M)

Contractor: Science and Engineering Services, LLC

Awarding Agency: Department of Defense

Start Date: 2010-10-05

End Date: 2013-08-31

Contract Duration: 1,061 days

Daily Burn Rate: $52.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: IRAQI ARMED 407 PRODUCTION

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35824, UNITED STATES OF AMERICA

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $55.7 million to SCIENCE AND ENGINEERING SERVICES, LLC for work described as: IRAQI ARMED 407 PRODUCTION Key points: 1. Contract awarded through full and open competition after exclusion of sources, suggesting a specific justification for limited bidding. 2. The contract duration of 1061 days indicates a significant, long-term commitment for aircraft manufacturing services. 3. The fixed-price contract type suggests that the contractor bears the risk of cost overruns. 4. The award to Science and Engineering Services, LLC warrants scrutiny of their past performance and capacity for such a large-scale project. 5. The North American Industry Classification System (NAICS) code 336411 points to a focus on aircraft manufacturing, a specialized sector. 6. The contract was awarded by the Department of the Army, a major component of the Department of Defense.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without specific details on the deliverables and the exact nature of the 'Iraqi armed 407 production.' The total award amount of $55.7 million over approximately 3 years suggests a substantial investment. However, without comparable contracts for similar armed helicopter production or upgrades, it's difficult to definitively assess if this represents excellent value for money. The fixed-price nature is a positive indicator for cost control, but the overall value hinges on the effectiveness and efficiency of the production process and the final product's performance.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This solicitation method indicates that while competition was sought, certain sources were excluded, implying a specific reason or requirement that narrowed the field. The number of bidders is not explicitly stated, but the 'exclusion of sources' suggests that the competition may not have been as broad as a standard full and open competition. This could potentially impact price discovery and lead to less competitive pricing.

Taxpayer Impact: Taxpayers may not have received the most competitive pricing due to the exclusion of certain potential bidders. The justification for exclusion needs to be robust to ensure fairness and optimal use of public funds.

Public Impact

The primary beneficiaries are likely the Iraqi armed forces, who will receive armed 407 helicopters, enhancing their operational capabilities. The services delivered involve the production and potentially modification or arming of 407 helicopters. The geographic impact is primarily in Iraq, where these helicopters will be deployed, and potentially in the United States where the production occurs. Workforce implications include jobs in aircraft manufacturing, engineering, and support services, both for the prime contractor and any subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the 'exclusion of sources' led to a less competitive bidding environment.
Risk associated with the performance and reliability of armed helicopters, especially in a demanding operational environment.
Dependence on a single contractor (Science and Engineering Services, LLC) for a critical defense capability.
Uncertainty regarding the long-term sustainment and maintenance costs of these specialized aircraft.

Positive Signals

The contract is firm fixed-price, which shifts cost risk to the contractor.
Awarded under a competitive process, even with exclusions, suggesting some level of market vetting.
The contract addresses a specific need for enhanced aerial capabilities for an allied nation.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft production. The global defense market for helicopters is substantial, with significant spending by various nations on both new acquisitions and upgrades. This contract represents a portion of that spending, likely aimed at providing light attack or reconnaissance capabilities. Comparable spending benchmarks would involve looking at other contracts for similar light attack helicopters or armed rotorcraft programs, both domestically and internationally.

Small Business Impact

The provided data does not indicate any small business set-aside provisions (ss: false, sb: false). This suggests that the contract was not specifically targeted towards small businesses. Therefore, the primary impact on the small business ecosystem would be through potential subcontracting opportunities if Science and Engineering Services, LLC engages small businesses for specialized components or services. Without explicit subcontracting plans, it's difficult to assess the direct benefit to small businesses.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. Accountability measures would be embedded in the contract terms, including performance standards, delivery schedules, and quality control requirements. Transparency is generally facilitated through contract award databases like FPDS, where basic information is publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

US Army Aviation Programs
Foreign Military Sales (FMS) Support
Light Attack Helicopter Programs
Defense Security Cooperation Agency (DSCA) Initiatives

Risk Flags

Limited competition due to exclusion of sources
Potential for cost overruns in fixed-price contracts if scope is not well-defined
Contractor's track record in complex defense manufacturing
Long-term sustainment and maintenance costs not detailed

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $55.7 million to SCIENCE AND ENGINEERING SERVICES, LLC. IRAQI ARMED 407 PRODUCTION

Who is the contractor on this award?

The obligated recipient is SCIENCE AND ENGINEERING SERVICES, 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 $55.7 million.

What is the period of performance?

Start: 2010-10-05. End: 2013-08-31.

What is the specific nature of the 'Iraqi armed 407 production' and what capabilities does it aim to provide?

The 'Iraqi armed 407 production' likely refers to the modification and arming of Bell 407 helicopters for use by the Iraqi armed forces. The Bell 407 is a versatile light utility helicopter that can be equipped with various weapon systems, such as machine guns, rockets, or guided missiles, to provide close air support, reconnaissance, or light attack capabilities. The specific armaments and modifications would depend on the operational requirements defined by the Iraqi military and agreed upon in the contract. This type of capability is crucial for counter-insurgency operations and border patrol, offering a more agile and cost-effective aerial platform compared to larger attack helicopters.

What are the past performance records of Science and Engineering Services, LLC, particularly concerning aircraft manufacturing and defense contracts?

Assessing the past performance of Science and Engineering Services, LLC (SES) is crucial given the $55.7 million award for armed helicopter production. A review of public contract databases (like FPDS) would be necessary to identify SES's history with the Department of Defense and other agencies. Key areas to investigate would include their experience with aircraft manufacturing, modification, and integration of weapon systems. Specific metrics to examine would be on-time delivery, adherence to budget (especially for fixed-price contracts), quality of work, and any past performance evaluations or disputes. A strong track record in similar complex defense manufacturing projects would increase confidence in their ability to execute this contract successfully.

How does the pricing of this contract compare to similar armed helicopter production or upgrade contracts?

Directly comparing the pricing of this $55.7 million contract for 'Iraqi armed 407 production' to similar contracts is challenging without detailed specifications of the work performed and the exact configuration of the armed helicopters. However, general benchmarks can be established by looking at the cost of Bell 407 platforms, the cost of various weapon systems, and the labor and overhead associated with integration and modification. For instance, the base cost of a new Bell 407 can range from $2.5 to $3.5 million. Adding sophisticated armaments and specialized modifications could easily add several million dollars per aircraft. Therefore, the total contract value would need to be analyzed on a per-unit basis, considering the number of helicopters produced and the complexity of the arming package, to determine if it aligns with market rates for similar capabilities.

What are the potential risks associated with the 'exclusion of sources' in the competition process for this contract?

The 'exclusion of sources' in a 'full and open competition after exclusion of sources' solicitation method implies that while the competition was intended to be open, specific potential bidders were deliberately excluded. This exclusion must be justified by the agency, often due to unique capabilities, proprietary technology, or specific national security requirements that only certain contractors can meet. The primary risk for taxpayers is that this exclusion may have limited the competitive landscape, potentially leading to higher prices than if a broader range of qualified bidders had participated. It could also indicate a reliance on a specific contractor's specialized expertise, which might create long-term dependencies. Thorough documentation and justification for the exclusion are critical to ensure fairness and prevent potential anti-competitive outcomes.

What is the historical spending trend for aircraft manufacturing (NAICS 336411) by the Department of the Army?

Analyzing the historical spending trend for aircraft manufacturing (NAICS 336411) by the Department of the Army provides context for the $55.7 million award. The Army, as a major branch of the DoD, consistently invests heavily in aviation assets, including procurement, modification, and sustainment of helicopters and other aircraft. Spending in this sector can fluctuate based on strategic priorities, modernization programs, and operational demands. For example, periods of active conflict often see increased spending on attack and utility helicopters. Conversely, budget constraints or shifts towards unmanned systems might lead to reduced spending. Examining multi-year spending data for NAICS 336411 by the Army would reveal patterns, identify peak spending periods, and highlight the typical scale of contracts within this industry, allowing for a better assessment of the current award's significance.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Science and Engineering Services LLC (UEI: 783196348)

Address: 248 DUNLOP BLVD, HUNTSVILLE, AL, 35824

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $55,706,337

Exercised Options: $55,706,337

Current Obligation: $55,706,337

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $27,454

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W58RGZ09D0130

IDV Type: IDC

Timeline