DOE awards $41.5M for Boeing 737NG aircraft modification to AAR Government Services
Contract Overview
Contract Amount: $41,503,077 ($41.5M)
Contractor: AAR Government Services, Inc.
Awarding Agency: Department of Energy
Start Date: 2021-08-23
End Date: 2026-05-31
Contract Duration: 1,742 days
Daily Burn Rate: $23.8K/day
Competition Type: COMPETED UNDER SAP
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: PROCUREMENT/MODIFICATION OF SINGLE 737NG BOEING FIXED WING AIRCRAFT.
Place of Performance
Location: HIGHLAND, SAN BERNARDINO County, CALIFORNIA, 92346
Plain-Language Summary
Department of Energy obligated $41.5 million to AAR GOVERNMENT SERVICES, INC. for work described as: PROCUREMENT/MODIFICATION OF SINGLE 737NG BOEING FIXED WING AIRCRAFT. Key points: 1. Contract value of $41.5M for aircraft modification. 2. Competition method was 'COMPETED UNDER SAP', indicating a potentially limited competition. 3. Risk of single-source reliance for specialized aircraft modifications. 4. Sector is 'Other Support Activities for Air Transportation'.
Value Assessment
Rating: fair
The contract value of $41.5M for a single aircraft modification appears high. Benchmarking against similar specialized aircraft modifications would be necessary to determine true value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was competed under SAP (Simplified Acquisition Procedures), which typically involves limited competition. This method may not have yielded the best price discovery.
Taxpayer Impact: Taxpayer funds are being used for a specialized aircraft modification, with potential for overpayment due to limited competition.
Public Impact
Impacts air transportation support services for the Department of Energy. Ensures operational readiness of specific aircraft assets. Potential for increased costs to taxpayers due to limited competition.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition under SAP
- Potential for cost overruns
- Reliance on a single contractor for specialized work
Positive Signals
- Definitive contract provides clear terms
- Firm Fixed Price contract limits cost escalation
Sector Analysis
This contract falls within the 'Other Support Activities for Air Transportation' sector. Spending in this area can be highly specialized and dependent on specific asset needs.
Small Business Impact
The data indicates that small businesses were not involved in this specific contract award, as 'sb' is false.
Oversight & Accountability
Oversight is managed by the Department of Energy. The use of SAP for a contract of this value warrants scrutiny to ensure fair competition and value for money.
Related Government Programs
- Other Support Activities for Air Transportation
- Department of Energy Contracting
- Department of Energy Programs
Risk Flags
- Potential for inadequate competition
- High contract value for a single asset modification
- Lack of transparency in procurement method justification
- Limited visibility into specific mission requirements
Tags
other-support-activities-for-air-transpo, department-of-energy, ca, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $41.5 million to AAR GOVERNMENT SERVICES, INC.. PROCUREMENT/MODIFICATION OF SINGLE 737NG BOEING FIXED WING AIRCRAFT.
Who is the contractor on this award?
The obligated recipient is AAR GOVERNMENT SERVICES, INC..
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $41.5 million.
What is the period of performance?
Start: 2021-08-23. End: 2026-05-31.
What is the justification for using SAP for a contract valued at over $41 million, and what steps were taken to ensure fair market competition?
The justification for using SAP for a contract of this value is unclear without further context. Typically, SAP is for acquisitions under the simplified acquisition threshold. If this contract exceeded that threshold, a waiver or specific justification would be required. Steps to ensure fair market competition would ideally involve broad solicitations, but SAP often limits outreach, potentially impacting price discovery and value for taxpayers.
What are the specific risks associated with modifying a single 737NG aircraft, and how are these risks being mitigated?
The primary risks include the high cost of specialized modifications for a single asset, potential for unforeseen technical challenges, and the contractor's sole reliance for this specific work. Mitigation strategies would involve robust contract oversight, clear performance metrics, and potentially contingency planning for unexpected issues. The firm fixed-price nature helps mitigate cost escalation, but not the initial pricing.
How does this contract contribute to the Department of Energy's mission, and is the allocated funding justified by the expected outcomes?
The contribution to the DOE's mission is not explicitly stated in the provided data. It likely relates to supporting specific operational needs or research involving air transportation assets. Justification of the $41.5M funding requires a clear understanding of the modification's scope, necessity, and the expected operational benefits or cost savings it will enable for the DOE.
Industry Classification
NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: COMPETED UNDER SAP
Solicitation Procedures: SIMPLIFIED ACQUISITION
Solicitation ID: 8923321RNA000102
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: AAR Government Services Inc.
Address: 1100 N WOOD DALE RD, WOOD DALE, IL, 60191
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $41,503,077
Exercised Options: $41,503,077
Current Obligation: $41,503,077
Actual Outlays: $40,939,904
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Timeline
Start Date: 2021-08-23
Current End Date: 2026-05-31
Potential End Date: 2026-05-31 00:00:00
Last Modified: 2026-03-31
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