Air Force awards $137.5M contract to Sierra Nevada Company for aircraft parts, bypassing competition
Contract Overview
Contract Amount: $137,521,435 ($137.5M)
Contractor: Sierra Nevada Company, LLC
Awarding Agency: Department of Defense
Start Date: 2015-07-29
End Date: 2017-07-31
Contract Duration: 733 days
Daily Burn Rate: $187.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: IGF::CT::IGF ACAT III BIG SAFARI 2015 CLS
Place of Performance
Location: SPARKS, WASHOE County, NEVADA, 89434
State: Nevada Government Spending
Plain-Language Summary
Department of Defense obligated $137.5 million to SIERRA NEVADA COMPANY, LLC for work described as: IGF::CT::IGF ACAT III BIG SAFARI 2015 CLS Key points: 1. Significant contract value of $137.5 million awarded. 2. Sole-source award to Sierra Nevada Company, LLC. 3. Contract duration of 733 days. 4. No small business participation indicated. 5. Awarded under Other Aircraft Parts and Auxiliary Equipment Manufacturing sector.
Value Assessment
Rating: questionable
The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed tightly. The benchmark price of $187,615 per delivery order seems high given the total award value and number of orders.
Cost Per Unit: $187,615
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as competitive pressures are absent.
Taxpayer Impact: The lack of competition for a $137.5 million contract raises concerns about the best use of taxpayer funds.
Public Impact
Taxpayers may have paid a premium due to the absence of competitive bidding. Limited transparency into the justification for a sole-source award. Potential for reduced innovation by not engaging a broader market of suppliers.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost Plus Fixed Fee contract type
- No small business participation
Positive Signals
- Awarded to a known entity (Sierra Nevada Company)
Sector Analysis
This contract falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector. Spending in this sector can be substantial, particularly for defense applications, and benchmarks vary widely based on specific components and technologies.
Small Business Impact
The data indicates no small business participation in this contract. This is a missed opportunity to support small businesses and could indicate a lack of outreach or specific requirements that favored larger, established contractors.
Oversight & Accountability
The sole-source nature of this award warrants further oversight to ensure the justification was sound and that the pricing is reasonable. Accountability for cost management under the Cost Plus Fixed Fee structure is crucial.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award lacks competition.
- Cost Plus Fixed Fee contract type increases risk of overruns.
- High per-unit cost benchmark.
- No small business participation.
- Long contract duration.
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, nv, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $137.5 million to SIERRA NEVADA COMPANY, LLC. IGF::CT::IGF ACAT III BIG SAFARI 2015 CLS
Who is the contractor on this award?
The obligated recipient is SIERRA NEVADA COMPANY, LLC.
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 $137.5 million.
What is the period of performance?
Start: 2015-07-29. End: 2017-07-31.
What was the specific justification for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?
The justification for a sole-source award is critical for understanding why competition was bypassed. Agencies typically require a detailed rationale, such as unique capabilities, urgent needs, or lack of market availability. Without this information, it's difficult to assess if taxpayer funds were used efficiently or if a more competitive approach could have yielded better pricing and innovation.
How does the per-unit cost benchmark of $187,615 compare to similar aircraft parts or auxiliary equipment procured competitively?
Comparing the $187,615 per-unit cost benchmark to competitively procured items is essential for value assessment. If this benchmark is significantly higher than comparable items obtained through competition, it suggests potential overpayment. A thorough analysis would involve identifying similar parts and their contract prices to establish a fair market value.
What mechanisms are in place to ensure cost control and prevent overruns under the Cost Plus Fixed Fee contract type for this award?
Cost Plus Fixed Fee contracts require robust oversight to manage expenses effectively. Key mechanisms include detailed cost tracking, regular audits, and clear performance metrics. The Air Force must actively monitor expenditures against the fixed fee and ensure that the contractor is operating efficiently to prevent unnecessary costs and maximize the value of the $137.5 million investment.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT 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
Address: 444 SALOMON CIR, SPARKS, NV, 89434
Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business
Financial Breakdown
Contract Ceiling: $137,521,435
Exercised Options: $137,521,435
Current Obligation: $137,521,435
Subaward Activity
Number of Subawards: 63
Total Subaward Amount: $44,211,753
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA862011G4020
IDV Type: BOA
Timeline
Start Date: 2015-07-29
Current End Date: 2017-07-31
Potential End Date: 2017-07-31 00:00:00
Last Modified: 2021-06-30
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