DoD awards $36.6M for computer facilities management, but competition was limited
Contract Overview
Contract Amount: $36,586,786 ($36.6M)
Contractor: Lockheed Martin Integrated Systems, LLC
Awarding Agency: Department of Defense
Start Date: 2009-10-01
End Date: 2013-09-30
Contract Duration: 1,460 days
Daily Burn Rate: $25.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIXED PRICE AWARD FEE
Sector: IT
Official Description: R0I0040 FUNDING FOR CLIN 1006 FFP OTION YEAR 1 OF CONTRACT
Place of Performance
Location: VICKSBURG, WARREN County, MISSISSIPPI, 39180
Plain-Language Summary
Department of Defense obligated $36.6 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC for work described as: R0I0040 FUNDING FOR CLIN 1006 FFP OTION YEAR 1 OF CONTRACT Key points: 1. Contract value represents a significant investment in IT infrastructure support. 2. The fixed-price award-fee structure aims to balance cost control with performance incentives. 3. Limited competition raises questions about potential overpayment and optimal resource allocation. 4. The contract duration of four years suggests a long-term need for these services. 5. The awardee, Lockheed Martin, is a major defense contractor with extensive experience. 6. Geographic concentration in Mississippi may indicate specific regional IT needs.
Value Assessment
Rating: fair
The contract's total value of $36.6 million over four years averages to approximately $9.15 million annually. Benchmarking this against similar IT facilities management contracts is challenging without more specific service details. However, the absence of competitive bidding suggests that the pricing may not have been subjected to market pressures, potentially leading to a less favorable value proposition for the government compared to a fully competed contract. The fixed-price award-fee structure is common, but its effectiveness in ensuring value depends heavily on the clarity and measurability of performance metrics.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor was solicited. This significantly limits the government's ability to explore the full range of market capabilities and pricing options. Without competition, there is a reduced incentive for the contractor to offer the most competitive pricing. The rationale for a sole-source award, if documented, would be crucial to understanding why other potential vendors were not considered.
Taxpayer Impact: Sole-source awards mean taxpayers may not be receiving the best possible price for these services, as market competition was bypassed.
Public Impact
The Department of the Army benefits from dedicated IT facilities management. Services likely include maintenance, operation, and support of critical computer infrastructure. The geographic impact is concentrated in Mississippi, supporting regional military operations. The contract supports the workforce of Lockheed Martin and potentially its subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition may lead to higher costs for taxpayers.
- Sole-source awards can reduce transparency and accountability in spending.
- Performance metrics for the award-fee component need rigorous oversight to ensure value.
Positive Signals
- Award to a large, established contractor like Lockheed Martin suggests a high likelihood of technical capability.
- Fixed-price element provides some cost certainty for the government.
- The contract duration indicates a stable, ongoing requirement.
Sector Analysis
This contract falls within the IT services sector, specifically focusing on computer facilities management. This sector is characterized by a wide range of providers, from large system integrators to specialized IT support firms. The market size for IT services supporting the federal government is substantial, with significant spending allocated annually to maintain and upgrade complex systems. This contract represents a portion of the Department of Defense's broader IT spending, aimed at ensuring operational readiness and efficiency.
Small Business Impact
The data indicates this contract was not competed and does not specify any small business set-aside provisions or subcontracting goals. As a sole-source award to a large prime contractor, it is unlikely to directly benefit small businesses through set-asides. However, the prime contractor may engage small businesses for subcontracting, though this is not explicitly stated. The absence of small business considerations in the award mechanism warrants further investigation into potential subcontracting opportunities.
Oversight & Accountability
Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are tied to the fixed-price award-fee structure, requiring the contractor to meet defined performance standards to earn the full fee. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Department of Defense IT Services
- Computer Facilities Management Contracts
- Lockheed Martin Contracts
- Sole-Source IT Awards
- Fixed-Price Award Fee Contracts
Risk Flags
- Sole-source award bypasses competition, potentially increasing costs.
- Lack of transparency in the procurement process.
- Performance metrics for award fee need rigorous monitoring.
Tags
it-services, department-of-defense, department-of-the-army, fixed-price-award-fee, large-contract, sole-source, computer-facilities-management, mississippi, lockheed-martin, it-infrastructure
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $36.6 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC. R0I0040 FUNDING FOR CLIN 1006 FFP OTION YEAR 1 OF CONTRACT
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 $36.6 million.
What is the period of performance?
Start: 2009-10-01. End: 2013-09-30.
What specific IT facilities management services are covered under this contract?
The contract description 'Computer Facilities Management Services' (NAICS 541513) suggests a broad range of IT support. This typically includes the operation, maintenance, and management of computer systems, data centers, and related infrastructure. Specific services could encompass network administration, server maintenance, data storage management, cybersecurity monitoring, help desk support, and disaster recovery planning. The exact scope would be detailed in the contract's Statement of Work (SOW), which outlines deliverables, performance standards, and specific tasks required by the Department of the Army.
What was the justification for awarding this contract on a sole-source basis?
Sole-source awards are typically justified when only one responsible source can provide the required supplies or services. Common justifications include urgent and compelling needs, unique capabilities possessed by a single contractor, or when a follow-on contract is necessary and only the original contractor can provide it without substantial duplication of cost. For this Lockheed Martin contract, the specific justification would need to be documented by the Department of the Army. Without this documentation, it is difficult to assess the validity of bypassing the competitive process and the potential impact on cost savings.
How does the $36.6 million total contract value compare to similar IT facilities management contracts awarded by the DoD?
The total contract value of $36.6 million over four years equates to an average annual value of approximately $9.15 million. Comparing this figure requires access to a database of similar contracts with detailed service scopes and performance metrics. However, for large-scale IT facilities management supporting military operations, this amount is within a plausible range, though potentially on the higher side if the scope is standard. The lack of competition makes a direct value-for-money comparison difficult, as a competitive process might have yielded lower prices or more extensive services for the same investment.
What are the key performance indicators (KPIs) tied to the 'award fee' component of this contract?
The 'award fee' component suggests that a portion of the total payment is contingent upon the contractor meeting or exceeding specific performance objectives defined in the contract. These KPIs are crucial for ensuring value and accountability. For computer facilities management, KPIs could include system uptime percentages, response times for service requests, successful implementation of security patches, completion of maintenance tasks on schedule, and user satisfaction ratings. The clarity, measurability, and attainability of these KPIs directly influence the effectiveness of the award fee structure in incentivizing high performance.
What is Lockheed Martin's track record with similar IT facilities management contracts for the Department of Defense?
Lockheed Martin is a major defense contractor with extensive experience in information technology and systems integration. They have a long history of managing complex IT infrastructure and services for various government agencies, including the Department of Defense. Their track record typically includes large-scale projects involving network operations, cybersecurity, software development, and systems sustainment. While specific performance details for past contracts would require deeper analysis, their status as a prime contractor suggests a demonstrated capability to handle significant IT support requirements.
What is the historical spending trend for computer facilities management services within the Department of the Army?
Historical spending on computer facilities management by the Department of the Army is substantial and generally trends upwards, driven by increasing reliance on digital systems and evolving cybersecurity threats. While this specific $36.6 million contract represents a single award, the Army, like other branches of the DoD, consistently allocates significant budgets to IT infrastructure, operations, and maintenance. Analyzing broader spending patterns would reveal fluctuations based on modernization initiatives, budget cycles, and shifts in strategic priorities, often involving a mix of competitive and sole-source awards.
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: FIXED PRICE AWARD FEE (M)
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: $36,586,786
Exercised Options: $36,586,786
Current Obligation: $36,586,786
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: 2009-10-01
Current End Date: 2013-09-30
Potential End Date: 2013-09-30 00:00:00
Last Modified: 2021-02-26
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