DoD's $38.5M ACE-IT Refresh Operations contract awarded to Lockheed Martin for IT services
Contract Overview
Contract Amount: $38,498,233 ($38.5M)
Contractor: Lockheed Martin Integrated Systems, LLC
Awarding Agency: Department of Defense
Start Date: 2008-10-20
End Date: 2010-09-30
Contract Duration: 710 days
Daily Burn Rate: $54.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST NO FEE
Sector: IT
Official Description: R0I0020 S00-0043 ACE-IT REFRESH OPERATIONS
Place of Performance
Location: VICKSBURG, WARREN County, MISSISSIPPI, 39180
Plain-Language Summary
Department of Defense obligated $38.5 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC for work described as: R0I0020 S00-0043 ACE-IT REFRESH OPERATIONS Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Duration of 710 days suggests a focused, short-term operational need. 3. Awarded as a delivery order, indicating it's part of a larger contract vehicle. 4. The 'Computer Facilities Management Services' NAICS code points to core IT infrastructure support. 5. The 'MS' contract type suggests a 'Cost Plus Fixed Fee' structure, requiring careful cost monitoring. 6. No small business set-aside was applied, potentially impacting small business participation.
Value Assessment
Rating: questionable
Benchmarking the value of this specific delivery order is challenging without knowing the parent contract's terms and the specific services rendered. However, the sole-source nature raises concerns about whether the government achieved the best possible price. The 'Cost Plus Fixed Fee' structure, while common for complex IT services, necessitates rigorous oversight to prevent cost overruns and ensure value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when a specific contractor possesses unique capabilities or when urgency dictates a rapid award. The lack of competition means that price discovery through market forces was limited, potentially leading to higher costs for the government.
Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from the competitive pricing that could have been achieved through an open bidding process.
Public Impact
The Department of Defense benefits from continued IT infrastructure support. Services likely include management and maintenance of computer facilities essential for military operations. The geographic impact is centered in Mississippi, where the contract is managed. Workforce implications would involve IT specialists employed by Lockheed Martin to fulfill the contract.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competitive pricing and potentially increases costs for taxpayers.
- Lack of small business set-aside may reduce opportunities for smaller IT firms.
- Cost-plus contract type requires robust oversight to manage expenses effectively.
Positive Signals
- Award to a large, established contractor like Lockheed Martin suggests a focus on reliability and expertise.
- The contract addresses essential IT operations, crucial for maintaining defense capabilities.
- Delivery order structure implies integration into a broader, potentially pre-vetted, contracting framework.
Sector Analysis
This contract falls within the IT services sector, specifically focusing on computer facilities management. This is a critical area for government operations, involving the maintenance and support of essential IT infrastructure. The market for such services is large and competitive, but sole-source awards can bypass typical market dynamics. Comparable spending benchmarks are difficult to establish without more detail on the specific services provided.
Small Business Impact
This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. This means that opportunities for small businesses to participate in this specific contract are limited. The absence of a small business set-aside may mean that the prime contractor, Lockheed Martin, will perform the majority of the work, potentially impacting the broader small business IT ecosystem that relies on subcontracting.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. As a sole-source award, scrutiny on performance and cost justification is crucial. Transparency regarding the specific services rendered and the justification for the sole-source award would be key indicators of effective oversight. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Department of Defense IT Modernization Programs
- Army IT Support Services
- Computer Facilities Management Contracts
- Lockheed Martin IT Services Contracts
Risk Flags
- Sole-source award may lead to higher costs.
- Lack of competition limits price discovery.
- Cost-plus contract requires diligent oversight.
Tags
it-services, department-of-defense, department-of-the-army, mississippi, delivery-order, sole-source, computer-facilities-management, lockheed-martin, cost-plus-fixed-fee, ace-it
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $38.5 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC. R0I0020 S00-0043 ACE-IT REFRESH OPERATIONS
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN INTEGRATED SYSTEMS, 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 $38.5 million.
What is the period of performance?
Start: 2008-10-20. End: 2010-09-30.
What specific IT facilities management services were included in this contract, and how do they align with the Army's operational needs?
The provided data indicates the NAICS code 541513 for Computer Facilities Management Services. This typically encompasses a range of activities such as operating and maintaining data centers, managing server infrastructure, providing network support, and ensuring the availability and security of IT systems. For the Department of the Army, these services are critical for supporting command and control, intelligence, logistics, and personnel management systems. The ACE-IT (Army Continuous Enterprise IT) program aims to modernize and consolidate the Army's IT infrastructure, and this contract likely represents a component of that larger effort, ensuring the smooth operation of essential computing facilities during a specific period.
What was the justification for awarding this contract on a sole-source basis instead of through full and open competition?
Sole-source awards are typically justified when only one responsible source can provide the required supplies or services. Common reasons include unique capabilities, proprietary technology, or urgent and compelling needs where competition is not feasible. For this ACE-IT Refresh Operations contract, the justification might stem from Lockheed Martin's existing role in a larger IT modernization program, specialized knowledge of the Army's complex IT environment, or a need to maintain continuity of operations without disruption. Without the specific justification documentation, it's difficult to ascertain the precise rationale, but it implies that competitive bidding was deemed impractical or detrimental to the government's interests at the time of award.
How does the 'Cost Plus Fixed Fee' (CPFF) contract type influence cost control and value for money in this context?
The 'Cost Plus Fixed Fee' (CPFF) contract type means the contractor (Lockheed Martin) is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure is often used for research and development or complex services where the scope is not precisely defined at the outset. For value for money, CPFF requires robust government oversight to ensure that costs are reasonable and allocable to the contract. The fixed fee incentivizes the contractor to control costs to some extent, as it does not increase with higher expenditures. However, the primary mechanism for ensuring value lies in the government's ability to audit costs and negotiate fair pricing, which can be more challenging than with fixed-price contracts.
What is the significance of this contract being a 'Delivery Order' under a larger contract vehicle?
This contract being a 'Delivery Order' signifies that it is a task order issued under a pre-existing indefinite-delivery, indefinite-quantity (IDIQ) contract or a similar type of contract vehicle. IDIQ contracts allow agencies to procure supplies or services over a period of time up to a specified maximum amount. Delivery Orders specify the actual quantities and delivery dates for specific requirements. This approach streamlines procurement by having a pre-competed contract vehicle in place, allowing for faster issuance of task orders like this one. It suggests that the broader contract under which this order was placed likely underwent a competitive process, but this specific delivery order was then issued directly to Lockheed Martin based on the terms of that larger vehicle.
What are the potential risks associated with a sole-source IT services contract of this duration and value?
The primary risk associated with a sole-source IT services contract is the potential for inflated costs due to the lack of competitive pressure. Taxpayers may end up paying more than they would in a competitive environment. Another risk is vendor lock-in, where the government becomes overly reliant on a single provider, making it difficult to switch or negotiate favorable terms in the future. Furthermore, without the diverse perspectives brought by multiple bidders, there's a risk that innovative solutions or more cost-effective approaches might be overlooked. The 'Cost Plus Fixed Fee' structure also introduces risks related to cost control and potential for cost overruns if not meticulously managed by the government.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Facilities Management Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST NO FEE (S)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 2001 JEFFERSON DAVIS HWY, STE 900, ARLINGTON, VA, 22202
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $38,498,233
Exercised Options: $38,498,233
Current Obligation: $38,498,233
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W91WMC07D0001
IDV Type: IDC
Timeline
Start Date: 2008-10-20
Current End Date: 2010-09-30
Potential End Date: 2010-09-30 00:00:00
Last Modified: 2020-05-29
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