DoD's $62.6M aircraft structural component repair contract awarded to Duncan Aviation Inc. shows potential value concerns

Contract Overview

Contract Amount: $108,588,175 ($108.6M)

Contractor: Duncan Aviation Inc

Awarding Agency: Department of Defense

Start Date: 2000-01-13

End Date: 2005-12-31

Contract Duration: 2,179 days

Daily Burn Rate: $49.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200004!2100!000499!AH23 !USA AVIATION AND MISSILE COMMAND!DAAH2300C0030 !A!*!* !20000113!20041231!626136238!626136238!626136238!N!4G242!DUNCAN AVIATION INC. !LINCOLN AIRPORT !LINCOLN !NE!68501!28000!109!31!LINCOLN !LANCASTER !NEBRASKA !0001!+000010573959!N!N!000000000000!J015!MAINT & REPAIR OF EQ/AIRCRAFT STRUCTURAL COMPS !A2 !MISSILE AND SPACE SYSTEMS !1ACF!C-23 SHERPA !3721!3!*!*!*!B!A!*!A !N!J!2!002!K!* !C!N!Z!* !* !N!B!N!A!*!B!A!A!A!* !*!N!A!B!N!*!*!*!*!*!

Place of Performance

Location: LINCOLN, LANCASTER County, NEBRASKA, 68524

State: Nebraska Government Spending

Plain-Language Summary

Department of Defense obligated $108.6 million to DUNCAN AVIATION INC for work described as: 200004!2100!000499!AH23 !USA AVIATION AND MISSILE COMMAND!DAAH2300C0030 !A!*!* !20000113!20041231!626136238!626136238!626136238!N!4G242!DUNCAN AVIATION INC. !LINCOLN AIRPORT !LINCOLN !NE!68501!28000!109!31!LINCOLN !LAN… Key points: 1. Contract value of $62.6M over nearly two years raises questions about cost-effectiveness for aircraft structural component repairs. 2. The contract was awarded under 'full and open competition after exclusion of sources,' suggesting a potentially limited competitive landscape. 3. A high number of modifications (109) indicates potential scope creep or evolving requirements, which can impact final costs. 4. The contract's duration of almost two years may not be optimal for agile maintenance and repair services. 5. Duncan Aviation Inc. is a significant player in aviation services, but benchmarking this specific contract's value is crucial. 6. The 'missile and space systems' sector classification for aircraft structural repairs warrants further investigation into the specific nature of the work.

Value Assessment

Rating: fair

The total contract value of $62.6 million over a period of approximately two years for aircraft structural component maintenance and repair appears substantial. Without specific benchmarks for similar repair services on C-23 Sherpa aircraft, it is difficult to definitively assess value for money. However, the high number of modifications (109) suggests that the initial pricing may not have fully captured the scope of work, potentially leading to increased costs over time. Further analysis comparing unit costs for specific repair types against industry averages would be beneficial.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'full and open competition after exclusion of sources.' This procurement method implies that while the competition was intended to be open, certain sources were excluded, potentially limiting the number of bidders. The specific reasons for exclusion are not detailed, but this approach can sometimes result in less competitive pricing compared to unrestricted full and open competition. The fact that there were only two bids received further supports the notion of a limited competitive environment.

Taxpayer Impact: The limited competition may have resulted in taxpayers paying a higher price than if a broader range of qualified vendors had been able to participate. This procurement strategy warrants scrutiny to ensure maximum value was achieved.

Public Impact

The U.S. Army benefits from the maintenance and repair of its C-23 Sherpa aircraft fleet, ensuring operational readiness. Services delivered include maintenance and repair of aircraft structural components, critical for flight safety and performance. The geographic impact is primarily within the United States, with Duncan Aviation's Lincoln, Nebraska facility serving as a key location. The contract supports skilled labor within the aviation maintenance and repair sector, contributing to the aerospace workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

High number of contract modifications (109) could indicate poor initial scope definition or uncontrolled changes, leading to potential cost overruns.
The procurement method 'full and open competition after exclusion of sources' raises questions about the breadth of competition and potential for inflated pricing.
The classification under 'Missile and Space Systems' for aircraft structural repairs is unusual and may obscure the true nature and cost drivers of the services provided.
The contract's duration of nearly two years might not be the most efficient model for dynamic aircraft repair needs.

Positive Signals

Duncan Aviation Inc. is a well-established provider of aviation services, suggesting a level of expertise and reliability.
The contract was awarded to a single vendor, which can sometimes streamline project management and execution if managed effectively.
The contract specifies a Firm Fixed Price (FFP) type, which generally provides cost certainty for the government, assuming the scope is well-defined.

Sector Analysis

This contract falls within the broader aerospace and defense sector, specifically focusing on aircraft maintenance, repair, and overhaul (MRO). The MRO market is a significant segment of the aviation industry, driven by the need to maintain aging fleets and ensure operational readiness. Spending in this area is critical for military readiness and involves specialized technical skills and facilities. Comparable spending benchmarks would typically involve analyzing other MRO contracts for similar aircraft types or service scopes within the Department of Defense.

Small Business Impact

There is no indication from the provided data that this contract included specific small business set-asides. The award went to Duncan Aviation Inc., a large business. Subcontracting opportunities for small businesses may exist, but they are not explicitly detailed in this summary. The impact on the small business ecosystem would depend on whether Duncan Aviation actively engages small businesses for specialized repair components or services.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Accountability measures are inherent in the contract terms, including performance standards and payment schedules tied to delivery. Transparency is facilitated through contract databases like FPDS, although detailed justifications for modifications or specific pricing elements may not always be publicly available. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Aircraft Maintenance and Repair Services
Aviation Component Repair
Defense Logistics Agency Contracts
US Army Aviation Support
Missile and Space Systems Support Contracts

Risk Flags

High number of modifications
Limited competition indicated
Unusual sector classification
Potential for cost overruns due to scope creep

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $108.6 million to DUNCAN AVIATION INC. 200004!2100!000499!AH23 !USA AVIATION AND MISSILE COMMAND!DAAH2300C0030 !A!*!* !20000113!20041231!626136238!626136238!626136238!N!4G242!DUNCAN AVIATION INC. !LINCOLN AIRPORT !LINCOLN !NE!68501!28000!109!31!LINCOLN !LANCASTER !NEBRASKA !0001!+000010573959!N!N!000000000000!J015!MAINT & REPAIR OF EQ/AIRCRAFT STRUCTURAL COMPS !A2 !MISSILE AND SPACE SYSTEMS !1ACF!C-23 SHERPA !3721!3!*!*!*!B!A!*!A !N!J!

Who is the contractor on this award?

The obligated recipient is DUNCAN AVIATION INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $108.6 million.

What is the period of performance?

Start: 2000-01-13. End: 2005-12-31.

What is the track record of Duncan Aviation Inc. with the Department of Defense for similar aircraft maintenance contracts?

Duncan Aviation Inc. has a history of performing aviation services for various government entities. While this specific contract focuses on structural components for the C-23 Sherpa, the company's broader experience includes a wide range of aircraft maintenance, repair, and modification services for both military and civilian clients. Analyzing past performance on similar DoD contracts, including on-time delivery, quality of work, and adherence to budget, would provide a clearer picture of their reliability. Information on past performance can often be found in contract award databases and performance assessment reports, though detailed historical data for this specific contract's predecessors or contemporaries would require deeper research.

How does the total contract value of $62.6 million compare to industry benchmarks for similar aircraft structural repair services?

Benchmarking the $62.6 million contract value requires detailed comparison with industry standards for the repair of C-23 Sherpa aircraft structural components. Factors such as the specific types of repairs performed, the complexity of the components, labor rates, and material costs significantly influence pricing. Without access to a detailed breakdown of the services rendered and Duncan Aviation's specific cost structure, a direct comparison is challenging. However, the high number of modifications (109) suggests that the initial cost estimates may have been significantly underestimated or that the scope of work evolved considerably, potentially inflating the overall cost beyond typical benchmarks for a two-year period.

What are the primary risks associated with the high number of contract modifications (109)?

The primary risks associated with 109 contract modifications over a nearly two-year period are significant. Firstly, it suggests potential issues with the initial contract scope definition, leading to frequent changes and additions. This can result in scope creep, where the project expands beyond its original objectives, often increasing costs and delaying timelines. Secondly, it raises concerns about the contractor's ability to accurately estimate and manage the full scope of work from the outset. Thirdly, frequent modifications can indicate a lack of clear requirements or evolving needs that were not adequately anticipated, potentially leading to inefficiencies and increased administrative burden for both the government and the contractor. This pattern often correlates with higher final costs compared to contracts with fewer modifications.

What does the 'full and open competition after exclusion of sources' procurement method imply for cost and efficiency?

The 'full and open competition after exclusion of sources' procurement method is a nuanced approach. It implies that the government sought competition but deliberately excluded certain potential bidders. The reasons for exclusion are critical; if based on specific technical capabilities or security requirements not met by all potential vendors, it might be justified. However, if the exclusions were arbitrary or overly restrictive, it could limit the competitive pool, potentially leading to higher prices and reduced innovation. This method can sometimes be used when specific expertise is rare, but it requires careful justification to ensure taxpayers receive the best possible value. The fact that only two bids were received further suggests that the exclusion criteria may have significantly narrowed the field.

How does the classification 'Missile and Space Systems' for aircraft structural repairs impact the understanding of this contract's purpose and cost?

Classifying aircraft structural component repairs under 'Missile and Space Systems' is unusual and potentially misleading. Aircraft structural components are typically associated with aerospace or aviation maintenance categories. This misclassification could obscure the true nature of the services being procured, making it difficult to compare spending against relevant benchmarks within the aviation sector. It might suggest that the structural components being repaired are unique or integrated into systems that also support missile or space applications, or it could simply be an administrative error in categorization. This ambiguity complicates analysis and raises questions about the accuracy of defense spending data and the rationale behind the chosen classification.

What is the historical spending trend for aircraft structural repairs by the US Army or DoD?

Analyzing historical spending trends for aircraft structural repairs by the US Army or DoD requires access to comprehensive contract databases over multiple fiscal years. Generally, spending in this category is substantial and fluctuates based on fleet size, aircraft age, operational tempo, and modernization programs. The DoD consistently allocates significant resources to aircraft maintenance, repair, and overhaul (MRO) to ensure fleet readiness. Factors like the introduction of new aircraft types, retirement of older fleets, and changes in maintenance philosophies (e.g., shifting towards contractor logistics support) influence spending patterns. Specific trends for C-23 Sherpa aircraft repairs would depend on the operational status and deployment of that particular airframe within the Army's inventory over time.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: LINCOLN AIRPORT, LINCOLN, NE, 01

Business Categories: Category Business, Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline