DoD's $67.8M contract for aircraft parts maintenance awarded to Vertex Aerospace LLC shows fair competition

Contract Overview

Contract Amount: $67,845,968 ($67.8M)

Contractor: Vertex Aerospace LLC

Awarding Agency: Department of Defense

Start Date: 2004-08-19

End Date: 2008-11-05

Contract Duration: 1,539 days

Daily Burn Rate: $44.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: TIME AND MATERIALS

Sector: Defense

Official Description: 200411!000692!5700!GD15 !OC-ALC/LIDAC !F3460197D0425 !A!N! !N!0223 ! !20040819!20050819!788547347!091441089!791716954!N!L-3 COMMUNICATIONS VERTEX AER!8001 MID-AMERICA BLVD !OKLAHOMA CITY !OK!73135!26736!027!48!FORT HOOD !BELL !TEXAS !+000007756975!N!N!000000000000!J023!MAINT & REPAIR OF EQ/VEHICLES-TRAILERS-CYCLES !A4A!COMBAT VEHICLES !000 !* !336413!E! !5!B!M! !A! !99990909!B! ! !A! !A!U!Y!2!004!B! !C!Y!Z! ! !N!C!N! ! ! !C!A!A!A!000!A!C!N! ! ! !Y!2100! !0001! !

Place of Performance

Location: KILLEEN, BELL County, TEXAS, 76544

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $67.8 million to VERTEX AEROSPACE LLC for work described as: 200411!000692!5700!GD15 !OC-ALC/LIDAC !F3460197D0425 !A!N! !N!0223 ! !20040819!20050819!788547347!091441089!791716954!N!L-3 COMMUNICATIONS VERTEX AER!8001 MID-AMERICA BLVD !OKLAHOMA CITY !OK!73135!26736!027!48!FORT HOOD !BELL… Key points: 1. The contract was awarded under full and open competition, indicating a competitive bidding process. 2. Vertex Aerospace LLC, the contractor, has a track record with the Department of Defense. 3. The contract duration of approximately 4.2 years suggests a medium-term need for these services. 4. The primary service involves maintenance and repair of equipment, vehicles, trailers, and cycles. 5. The contract falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' NAICS code. 6. The contract was awarded to a single vendor, Vertex Aerospace LLC, despite open competition.

Value Assessment

Rating: fair

The total award amount of $67.8 million over its period of performance suggests a significant investment in aircraft parts maintenance. Benchmarking this against similar contracts is challenging without more specific service details and market data. However, the contract type (Time and Materials) can sometimes lead to cost overruns if not managed closely. The price appears to be within a reasonable range for the scope of work, but a detailed cost analysis would be needed for a definitive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition,' meaning all responsible sources were permitted to submit a bid. The data indicates that while the competition was open, the award was made to a single entity, Vertex Aerospace LLC. The number of bidders is not explicitly stated in the provided data, but the 'full and open' designation implies that multiple bids were likely solicited and considered. This level of competition is generally expected to drive better pricing and value for the government.

Taxpayer Impact: A full and open competition, even if resulting in a single awardee, suggests that the government sought the best possible offer. This process aims to ensure taxpayer funds are used efficiently by leveraging market forces to obtain competitive pricing.

Public Impact

The primary beneficiaries are likely military personnel and units relying on well-maintained aircraft and vehicles for operational readiness. The services delivered include essential maintenance and repair for a variety of equipment, including combat vehicles. The contract's geographic impact is centered around Fort Hood, Texas, indicating a direct support role for operations at that installation. Workforce implications include potential job creation or retention at Vertex Aerospace LLC and related support industries in the Oklahoma City area and potentially near Fort Hood.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The Time and Materials (T&M) contract type carries inherent risks of cost escalation if not closely monitored and managed.
While competition was open, the award to a single vendor warrants scrutiny to ensure no potential bidders were inadvertently excluded or discouraged.
The specific nature of 'maintenance and repair' can be broad, requiring clear performance standards to avoid scope creep and ensure effective service delivery.

Positive Signals

The contract was awarded through a 'full and open competition' process, suggesting a robust effort to solicit competitive offers.
The contractor, Vertex Aerospace LLC, is an established entity, potentially indicating a level of reliability and experience.
The contract addresses critical support functions for military equipment, contributing to operational readiness.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically related to the manufacturing and maintenance of aircraft parts and auxiliary equipment. The market for defense contracting is substantial, with significant government spending allocated to maintaining and upgrading military assets. Comparable spending benchmarks would typically involve analyzing other contracts for similar maintenance and repair services across different military branches and for various types of aircraft and vehicles.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses arising from a small business set-aside. The primary focus of this contract appears to be on large-scale maintenance and repair services, likely executed by the prime contractor or its larger supply chain partners.

Oversight & Accountability

Oversight for this Department of Defense contract would typically be managed by the contracting officer and the relevant program management office within the Department of the Air Force. Accountability measures would be defined in the contract's terms and conditions, including performance standards and delivery schedules. Transparency is facilitated through contract databases like FPDS, which provide public access to contract awards. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Aircraft Maintenance and Repair Services
Combat Vehicle Maintenance
Defense Logistics Support
Aerospace Parts Manufacturing
Military Equipment Sustainment

Risk Flags

Potential for cost overruns due to Time and Materials contract type.
Need for clear performance metrics to ensure service quality.
Scrutiny of single-award outcome despite open competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $67.8 million to VERTEX AEROSPACE LLC. 200411!000692!5700!GD15 !OC-ALC/LIDAC !F3460197D0425 !A!N! !N!0223 ! !20040819!20050819!788547347!091441089!791716954!N!L-3 COMMUNICATIONS VERTEX AER!8001 MID-AMERICA BLVD !OKLAHOMA CITY !OK!73135!26736!027!48!FORT HOOD !BELL !TEXAS !+000007756975!N!N!000000000000!J023!MAINT & REPAIR OF EQ/VEHICLES-TRAILERS-CYCLES !A4A!COMBAT VEHICLES !000 !* !336413!E! !5!B!M! !A! !999

Who is the contractor on this award?

The obligated recipient is VERTEX AEROSPACE 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 $67.8 million.

What is the period of performance?

Start: 2004-08-19. End: 2008-11-05.

What is Vertex Aerospace LLC's overall track record with the federal government, particularly the Department of Defense?

Vertex Aerospace LLC has a history of receiving federal contracts, primarily from the Department of Defense. Their contract portfolio often includes services related to aircraft maintenance, repair, and overhaul, as well as component manufacturing. Analyzing their past performance, including on-time delivery, quality of work, and adherence to contract terms, provides insight into their reliability. Federal procurement data often reveals patterns in contract awards, indicating whether they are a frequent or occasional supplier for specific agencies or types of services. A review of their contract history can highlight any significant past issues or commendations, offering a basis for assessing their suitability for current and future awards.

How does the awarded price of $67.8 million compare to similar aircraft parts maintenance contracts?

Comparing the $67.8 million award to similar contracts requires access to a broader dataset of federal procurements for aircraft parts maintenance and repair. Key comparison factors include the contract duration (approximately 4.2 years in this case), the specific types of aircraft or components serviced, the labor rates, and the overhead applied. Contracts with similar scope, complexity, and performance periods would serve as benchmarks. Without such comparative data, it's difficult to definitively state whether this award represents excellent, fair, or questionable value. However, the 'full and open competition' suggests an effort to achieve competitive pricing, which is a positive indicator.

What are the primary risks associated with this Time and Materials (T&M) contract type?

Time and Materials (T&M) contracts carry inherent risks, primarily related to cost control. Unlike fixed-price contracts, T&M agreements reimburse the contractor for direct labor hours at specified hourly rates and for the actual cost of materials. This structure can lead to cost overruns if the scope of work is not well-defined or if the contractor's efficiency is low, as the government pays for the time and materials consumed. Effective risk mitigation requires robust government oversight, including detailed monitoring of labor hours, material costs, and progress towards deliverables. Clear definition of 'best efforts' or 'level of effort' clauses is crucial to prevent indefinite spending and ensure the contractor is incentivized to complete the work efficiently.

How effective is the 'full and open competition' process in ensuring value for taxpayer money in this specific case?

The 'full and open competition' process is designed to maximize value for taxpayers by encouraging multiple vendors to bid, thereby driving down prices and improving service quality. In this specific case, the data indicates the contract was awarded under this framework, suggesting that the government sought competitive offers. However, the fact that the award went to a single vendor, Vertex Aerospace LLC, means that the ultimate measure of value depends on the number and quality of bids received and the competitiveness of the winning proposal. If multiple strong bids were considered, the process likely yielded good value. If only one viable bid was submitted, the competitive pressure might have been less intense, potentially impacting the final price.

What is the historical spending pattern for aircraft parts maintenance and repair within the Department of Defense?

Historical spending on aircraft parts maintenance and repair within the Department of Defense (DoD) is substantial and represents a significant portion of the defense budget. The DoD relies heavily on maintaining its vast fleet of aircraft, which necessitates continuous investment in parts, repair services, and overhaul capabilities. Spending patterns are influenced by factors such as the age of aircraft fleets, modernization programs, operational tempo, and geopolitical events. Over the years, the DoD has awarded numerous contracts for these services, ranging from depot-level maintenance to component repair and spare parts procurement. Analyzing historical data reveals trends in contractor selection, contract types utilized, and overall expenditure levels, providing context for current contract awards like the one to Vertex Aerospace LLC.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 4

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: L-3 Communications Holdings, Inc. (UEI: 008898843)

Address: 8001 MID AMERICA BLVD STE 500, OKLAHOMA CITY, OK, 90

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: F3460197D0425

IDV Type: IDC

Timeline