DOT's FAA awards $13.6M for logistics support, raising questions about competition and value

Contract Overview

Contract Amount: $13,556,804 ($13.6M)

Contractor: Sentinel Aerospace, LLC

Awarding Agency: Department of Transportation

Start Date: 2024-09-25

End Date: 2026-09-24

Contract Duration: 729 days

Daily Burn Rate: $18.6K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: AJF-2 CONTRACT LOGISTICS SUPPORT- PARTS

Place of Performance

Location: CHANDLER, MARICOPA County, ARIZONA, 85225

State: Arizona Government Spending

Plain-Language Summary

Department of Transportation obligated $13.6 million to SENTINEL AEROSPACE, LLC for work described as: AJF-2 CONTRACT LOGISTICS SUPPORT- PARTS Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. The firm-fixed-price contract type offers some cost certainty but may not incentivize efficiency. 3. Limited competition raises concerns about whether the government secured the best possible value. 4. The contract duration of nearly two years warrants scrutiny of performance and potential extensions. 5. The specific nature of 'parts' logistics support requires further definition to assess necessity. 6. Geographic focus on Arizona for logistics support may indicate a localized operational need.

Value Assessment

Rating: questionable

Benchmarking the value of this $13.6 million contract is challenging due to the lack of competitive bidding. The firm-fixed-price structure provides some predictability, but without comparison to other offers, it's difficult to ascertain if the pricing is optimal. The absence of a competitive process means the government may not have achieved the most cost-effective solution for these logistics support services. Further analysis would be needed to compare unit costs or service rates against industry standards or similar government contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the Simplified Acquisition Procedures (SAP) and was awarded on a sole-source basis. This means that only one vendor, Sentinel Aerospace, LLC, was solicited for this requirement. The lack of competition limits the government's ability to explore alternative solutions or negotiate more favorable terms based on multiple bids. Consequently, the price and terms may not reflect the full potential of market competition.

Taxpayer Impact: Sole-source awards mean taxpayers do not benefit from the cost savings that typically arise from a competitive bidding process. This can lead to higher overall spending for the same level of service.

Public Impact

The Federal Aviation Administration (FAA) benefits from this contract by securing necessary parts logistics support. This contract ensures the continuity of operations and maintenance for FAA assets. The primary geographic impact is in Arizona, where the logistics support will be physically provided. The contract supports the workforce involved in logistics, warehousing, and potentially transportation within Arizona.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated prices.
Sole-source award raises concerns about transparency and fairness.
Contract duration without clear performance metrics could mask inefficiencies.
The specific 'parts' covered are undefined, creating potential scope creep or overspending.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Award to Sentinel Aerospace, LLC suggests a potentially established relationship or specialized capability.
Contract is for essential logistics support, indicating a critical operational need.

Sector Analysis

This contract falls within the broader aerospace and defense logistics sector, which is critical for supporting government operations. The market for specialized logistics services is competitive, but sole-source awards bypass this dynamic. The value of this contract, approximately $13.6 million over two years, is moderate within the context of large federal procurement but significant for the specific services rendered. Comparable spending benchmarks are difficult to establish without knowing the exact nature of the parts and services.

Small Business Impact

The contract data indicates that small business participation is not a primary focus, as the awardee is Sentinel Aerospace, LLC, and there is no indication of a small business set-aside. Subcontracting opportunities for small businesses are not explicitly detailed in the provided information. The impact on the small business ecosystem is likely minimal unless Sentinel Aerospace, LLC actively engages small businesses for subcontracted services.

Oversight & Accountability

Oversight for this contract would typically fall under the Federal Aviation Administration's contracting officer and program managers. Accountability measures are inherent in the firm-fixed-price structure, which obligates the contractor to deliver specified goods or services at an agreed-upon price. 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

Federal Aviation Administration Logistics Contracts
Department of Transportation Supply Chain Management
Aerospace Parts Procurement
Government Logistics Services
Sole-Source Federal Awards

Risk Flags

Sole-source award
Lack of competition
Undefined scope ('parts')
Potential for inflated pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $13.6 million to SENTINEL AEROSPACE, LLC. AJF-2 CONTRACT LOGISTICS SUPPORT- PARTS

Who is the contractor on this award?

The obligated recipient is SENTINEL AEROSPACE, LLC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $13.6 million.

What is the period of performance?

Start: 2024-09-25. End: 2026-09-24.

What is Sentinel Aerospace, LLC's track record with the federal government, particularly with the FAA?

A review of federal procurement data would be necessary to fully assess Sentinel Aerospace, LLC's track record. However, the award of this sole-source contract suggests a pre-existing relationship or a recognized capability that the FAA deemed essential. Without access to detailed contract histories, it's difficult to determine the extent of their past performance, including any past issues with delivery, quality, or cost overruns on previous government contracts. Further investigation into their award history, past performance evaluations, and any debriefings from previous solicitations would provide a clearer picture of their reliability and suitability for this role.

How does the $13.6 million value compare to similar logistics support contracts for aviation parts?

Direct comparison of the $13.6 million value is difficult without a precise definition of the 'parts' and 'logistics support' services covered. However, for a nearly two-year contract, this amount suggests a significant scope of work. In the broader federal logistics market, contract values can range from thousands to billions. For specialized aviation parts logistics, especially those requiring specific handling, storage, or rapid deployment, costs can be substantial. The lack of competition here prevents a direct benchmark against other potential providers, making it hard to definitively state if this represents good or fair market value. A detailed cost breakdown from the contractor would be needed for a more granular analysis.

What are the primary risks associated with this sole-source award for logistics support?

The primary risks associated with this sole-source award are financial and operational. Financially, the lack of competition means the FAA may be paying a premium for these services, as Sentinel Aerospace, LLC faced no pressure to offer the lowest possible price. Operationally, there's a risk that the chosen vendor may not be the most efficient or innovative provider available in the market. Furthermore, the undefined nature of 'parts' could lead to scope creep, where the contractor provides more than initially intended, driving up costs. Dependence on a single supplier also introduces supply chain risk if Sentinel Aerospace, LLC experiences internal disruptions.

How effective is the firm-fixed-price contract type in ensuring the FAA receives value for its money in this context?

The firm-fixed-price (FFP) contract type is generally favored by the government for its cost certainty, as it shifts most of the risk to the contractor. For this logistics support contract, FFP means Sentinel Aerospace, LLC is obligated to provide the specified services and parts at the agreed-upon $13.6 million price. This structure helps the FAA budget accurately and protects against cost overruns if the contractor's expenses increase. However, the effectiveness in ensuring *value* is diminished by the sole-source nature. While the price is fixed, it may be a higher fixed price than what could have been achieved through competition. The FFP structure doesn't inherently guarantee efficiency or the best possible service quality, only adherence to the agreed terms at the agreed price.

What are the historical spending patterns for similar logistics support services by the FAA?

Analyzing historical spending patterns for similar FAA logistics support services would require access to comprehensive federal procurement databases. Without such data, it's impossible to provide specific figures. However, the FAA, as a major federal agency responsible for aviation safety and infrastructure, consistently procures a wide range of support services, including logistics, maintenance, and supply chain management. Spending on these services can fluctuate based on operational needs, fleet size, infrastructure projects, and technological upgrades. The current $13.6 million award for parts logistics should ideally be viewed in the context of the FAA's overall budget and its historical investments in similar support functions to determine if it represents a consistent or anomalous expenditure.

What are the implications of the contract being awarded in Arizona for the overall logistics network?

The contract being awarded for services in Arizona suggests a localized operational requirement for the FAA. This could relate to specific maintenance facilities, regional offices, or operational bases located within the state. The implication for the broader logistics network is that this contract addresses a specific geographic need rather than a nationwide requirement. It may indicate a decentralized approach to logistics support, where regional hubs or specific state-level operations are managed independently. The concentration of this contract's activity in Arizona means that the benefits and impacts, such as job creation or local economic activity, will be primarily felt within that state.

Industry Classification

NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 955 S BOGLE AVE, CHANDLER, AZ, 85225

Business Categories: Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Limited Liability Corporation, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $13,556,804

Exercised Options: $13,556,804

Current Obligation: $13,556,804

Actual Outlays: $13,014,081

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 6973GH24A00015

IDV Type: BPA

Timeline