DoD awards $57.5M for aircraft modifications, with over 2,700 days of performance

Contract Overview

Contract Amount: $57,459,770 ($57.5M)

Contractor: Science and Engineering Services, LLC

Awarding Agency: Department of Defense

Start Date: 2013-04-25

End Date: 2020-09-30

Contract Duration: 2,715 days

Daily Burn Rate: $21.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: MI-17 OVERHAULS AND FT RUCKER COCKPIT MODIFICATIONS

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35824

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $57.5 million to SCIENCE AND ENGINEERING SERVICES, LLC for work described as: MI-17 OVERHAULS AND FT RUCKER COCKPIT MODIFICATIONS Key points: 1. Contract awarded to Science and Engineering Services, LLC for aircraft overhauls and cockpit modifications. 2. Performance period spans over 2,700 days, indicating a long-term, complex project. 3. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 4. The award was made under 'Full and Open Competition After Exclusion of Sources', suggesting a specific justification for limiting initial bidders. 5. This contract falls under the Aircraft Manufacturing sector, aligning with broader defense industry needs. 6. The geographic location for performance is Alabama.

Value Assessment

Rating: fair

Benchmarking the value of this $57.5 million contract is challenging without specific deliverables and performance metrics. The Cost Plus Fixed Fee (CPFF) contract type inherently carries risks of cost escalation, as the contractor is reimbursed for allowable costs plus a fixed fee. While CPFF can be appropriate for research and development or when costs are uncertain, it requires robust oversight to ensure value for money. Comparing this to similar aircraft modification contracts would require detailed analysis of scope, complexity, and duration.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources'. This designation implies that while the competition was intended to be open, specific sources were excluded, potentially limiting the number of bidders. The rationale behind this exclusion is critical for understanding the true level of competition and its impact on pricing. Without further details on the exclusion criteria, it's difficult to definitively assess the breadth of competition.

Taxpayer Impact: The exclusion of sources, even within a framework of open competition, may have limited the number of competitive bids, potentially impacting the government's ability to secure the lowest possible price for taxpayers.

Public Impact

The Department of Defense benefits from modernized aircraft, enhancing operational capabilities. Services delivered include overhauls and cockpit modifications for aircraft. The primary geographic impact is in Alabama, where the contract performance is located. This contract supports specialized roles within the aerospace and defense manufacturing workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type introduces risk of cost overruns.
Limited competition due to exclusion of sources may impact price discovery.
Long performance period (2715 days) requires sustained oversight to ensure continued value.

Positive Signals

Awarded to a single contractor, potentially streamlining management.
Contract addresses critical defense needs for aircraft modernization.
Performance located within the United States.

Sector Analysis

This contract falls within the Aircraft Manufacturing sector, a significant segment of the broader aerospace and defense industry. This sector is characterized by high technological complexity, stringent quality requirements, and substantial government investment. Spending in this area is driven by the need for continuous modernization of military fleets to maintain technological superiority and operational readiness. Comparable spending benchmarks would typically involve other large-scale aircraft modification, overhaul, and upgrade programs within the Department of Defense.

Small Business Impact

The data indicates that small business participation was not a primary focus for this contract, as the 'sb' field is false. There is no explicit mention of small business set-asides or subcontracting plans. This suggests that the prime contractor, Science and Engineering Services, LLC, is likely a larger entity, and the contract's scale and technical requirements may not have been conducive to significant small business involvement directly through set-asides.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. The Cost Plus Fixed Fee structure necessitates rigorous financial oversight to monitor allowable costs and the reasonableness of the fixed fee. Transparency would be enhanced through regular reporting requirements from the contractor and potential audits. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Aircraft Maintenance and Repair
Aerospace Defense Contracts
Military Aircraft Modernization
Defense Procurement
Aircraft Manufacturing Services

Risk Flags

Potential for cost overruns due to CPFF contract type.
Limited competition may have impacted price.
Long performance period requires sustained oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $57.5 million to SCIENCE AND ENGINEERING SERVICES, LLC. MI-17 OVERHAULS AND FT RUCKER COCKPIT MODIFICATIONS

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $57.5 million.

What is the period of performance?

Start: 2013-04-25. End: 2020-09-30.

What is the specific nature of the 'MI-17 OVERHAULS AND FT RUCKER COCKPIT MODIFICATIONS' and why was this particular aircraft type selected for such extensive work?

The 'MI-17 OVERHAULS AND FT RUCKER COCKPIT MODIFICATIONS' likely refers to the overhaul of Mi-17 helicopters, a Russian-designed military transport helicopter operated by various countries, including potentially U.S. allies or partner nations, or used in specific training scenarios. The 'Ft Rucker' designation suggests a connection to the U.S. Army Aviation Center of Excellence at Fort Rucker, Alabama, which is a major training base. The extensive overhaul and cockpit modifications would aim to enhance the aircraft's safety, performance, avionics, and potentially extend its service life. The selection of the Mi-17 for such work could be due to its continued operational relevance in certain theaters or training environments, or perhaps for specialized roles where its capabilities are deemed essential, despite its foreign design origin. The long performance period indicates a comprehensive and detailed process.

How does the Cost Plus Fixed Fee (CPFF) structure for this $57.5 million contract compare to industry standards for similar aircraft modification projects?

The Cost Plus Fixed Fee (CPFF) contract structure is common in defense contracting, particularly for projects where the scope of work is not fully defined at the outset or involves significant research and development elements, such as complex aircraft modifications. For a project of this magnitude ($57.5 million) and duration (over 2,700 days), CPFF can be appropriate if the exact costs are difficult to estimate. However, it places a greater burden on the government to meticulously track and audit contractor costs to ensure they are reasonable and allowable. Industry standards often favor fixed-price contracts when scope is well-defined to incentivize contractor efficiency and cost control. The 'fixed fee' component aims to provide the contractor with a predictable profit margin, but the 'cost plus' aspect means the government bears the risk of cost overruns. Robust oversight is crucial to ensure this structure delivers value comparable to other contract types.

What are the potential risks associated with the 'Full and Open Competition After Exclusion of Sources' award type, and how might it have affected the final price?

The 'Full and Open Competition After Exclusion of Sources' award type suggests that while the competition was intended to be open, certain potential bidders were deliberately excluded. This exclusion could be based on various factors, such as specific technical capabilities, past performance, or proprietary technology requirements. The primary risk is that by limiting the pool of potential bidders, the government may have inadvertently reduced the level of competition, potentially leading to a higher final price than if a truly unrestricted open competition had occurred. It also raises questions about the justification for the exclusion and whether it was truly necessary for the successful execution of the contract. Without knowing who was excluded and why, it's difficult to quantify the precise impact on price discovery, but it inherently introduces a degree of uncertainty regarding optimal value.

Given the 2715-day performance period, what are the key performance indicators (KPIs) likely being tracked by the Defense Contract Management Agency (DCMA) for this contract?

For a contract with a 2715-day performance period involving aircraft overhauls and modifications, the DCMA would likely track a range of Key Performance Indicators (KPIs) focused on schedule adherence, cost control, quality, and technical performance. Key KPIs would include: 1. Schedule Milestones: Tracking progress against major project phases and delivery dates for completed work packages. 2. Cost Performance Index (CPI) and Schedule Performance Index (SPI): Using Earned Value Management (EVM) to monitor if the project is on budget and on schedule. 3. Quality Assurance Metrics: Monitoring defect rates, rework, and compliance with technical specifications and airworthiness standards. 4. Technical Performance: Assessing whether the modifications meet or exceed the required performance parameters (e.g., avionics functionality, structural integrity). 5. Contractor Resource Management: Ensuring adequate staffing and efficient utilization of labor and equipment. 6. Risk Management: Proactive identification and mitigation of potential risks that could impact cost, schedule, or performance.

What is the historical spending pattern for Science and Engineering Services, LLC with the Department of Defense, and does this contract represent a significant deviation?

To assess the historical spending pattern of Science and Engineering Services, LLC with the Department of Defense, one would need access to a comprehensive database of federal contract awards. Without that specific data, it's impossible to definitively state their historical spending or whether this $57.5 million contract is a deviation. However, the nature of the contract (aircraft modifications) suggests it aligns with typical defense sector activities. If Science and Engineering Services, LLC has a history of performing similar large-scale technical services for the DoD, this contract might represent a continuation of their established role. Conversely, if their prior contracts were significantly smaller in value or scope, or focused on different service areas, this award could represent a substantial expansion of their business with the DoD. Further analysis would require examining their contract portfolio over several fiscal years.

How does the geographic concentration of contract performance in Alabama potentially impact the local economy and workforce, considering the specialized nature of aircraft manufacturing?

The concentration of contract performance for aircraft overhauls and cockpit modifications in Alabama, specifically related to a $57.5 million award over 2715 days, can have a significant positive impact on the local economy and workforce. This type of contract typically requires a highly skilled labor force, including aircraft mechanics, avionics technicians, engineers, and quality control specialists. The long duration suggests sustained employment opportunities and potential for workforce development programs. The economic impact extends beyond direct employment, benefiting local suppliers of goods and services, and potentially driving demand for specialized training and educational programs in aviation trades. Alabama has a notable presence in the aerospace and defense sector, so this contract likely leverages and further strengthens that existing industrial base and skilled workforce.

Industry Classification

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

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Science and Engineering Services LLC

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: $80,208,063

Exercised Options: $58,829,110

Current Obligation: $57,459,770

Subaward Activity

Number of Subawards: 24

Total Subaward Amount: $33,361,750

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W58RGZ09D0130

IDV Type: IDC

Timeline