DOT's $3.8B DAFIS UDO RECONSTRUCT Contract Awarded to Lockheed Martin Services, LLC
Contract Overview
Contract Amount: $3,829,863,945 ($3.8B)
Contractor: Lockheed Martin Services, LLC
Awarding Agency: Department of Transportation
Start Date: 2009-10-24
End Date: 2021-12-31
Contract Duration: 4,451 days
Daily Burn Rate: $860.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Other
Official Description: DAFIS UDO RECONSTRUCT W/O ADVANCE
Place of Performance
Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850
State: Maryland Government Spending
Plain-Language Summary
Department of Transportation obligated $3.83 billion to LOCKHEED MARTIN SERVICES, LLC for work described as: DAFIS UDO RECONSTRUCT W/O ADVANCE Key points: 1. Significant contract value of $3.8 billion over 12 years. 2. Awarded via full and open competition, suggesting a competitive bidding process. 3. Contract type is Cost Plus Incentive Fee, which can lead to cost overruns if not managed closely. 4. The sector is 'Other Communications Equipment Manufacturing', indicating specialized technology procurement.
Value Assessment
Rating: fair
The contract value is substantial, spanning over a decade. Benchmarking is difficult without specific unit cost data, but the duration and CPIF structure warrant scrutiny for potential cost escalation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, which typically fosters competitive pricing. However, the CPIF structure means the government pays costs plus a fee, with incentives for performance, which can impact the final price discovery.
Taxpayer Impact: While competition is positive, the CPIF contract type and long duration mean taxpayers could face higher costs if performance incentives are not met or if costs escalate beyond initial projections.
Public Impact
Impacts Federal Aviation Administration's operational capabilities through communication equipment. Long-term contract suggests ongoing reliance on Lockheed Martin's services. Potential for technological advancements or obsolescence over the contract's 12-year lifespan.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Incentive Fee (CPIF) structure can incentivize cost overruns.
- Long contract duration (12 years) increases risk of cost escalation and technological obsolescence.
- No indication of small business participation.
Positive Signals
- Awarded through full and open competition, promoting a competitive environment.
- Contract aims to reconstruct DAFIS UDO, implying a critical system upgrade.
Sector Analysis
The 'Other Communications Equipment Manufacturing' sector involves specialized hardware and software for communication systems. Spending in this area is often driven by national security, infrastructure upgrades, and technological advancement needs. Benchmarks are highly specific to the technology involved.
Small Business Impact
The data indicates that small businesses were not involved in this contract, as the 'sb' field is false. This suggests the prime contractor, Lockheed Martin, is a large corporation, and there's no explicit mention of subcontracting opportunities for small businesses.
Oversight & Accountability
The contract's long duration and CPIF structure necessitate robust oversight from the Federal Aviation Administration to ensure cost control and effective performance. Regular reviews and audits will be crucial to manage risks and ensure taxpayer value.
Related Government Programs
- Other Communications Equipment Manufacturing
- Department of Transportation Contracting
- Federal Aviation Administration Programs
Risk Flags
- Cost Plus Incentive Fee (CPIF) contract type.
- Long contract duration (over 12 years).
- Lack of small business participation noted.
- Potential for technological obsolescence.
- Significant contract value ($3.8B).
Tags
other-communications-equipment-manufactu, department-of-transportation, md, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Transportation awarded $3.83 billion to LOCKHEED MARTIN SERVICES, LLC. DAFIS UDO RECONSTRUCT W/O ADVANCE
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN SERVICES, LLC.
Which agency awarded this contract?
Awarding agency: Department of Transportation (Federal Aviation Administration).
What is the total obligated amount?
The obligated amount is $3.83 billion.
What is the period of performance?
Start: 2009-10-24. End: 2021-12-31.
What specific performance metrics are tied to the incentive fee in this CPIF contract, and how are they measured to ensure value for money?
The contract details do not specify the exact performance metrics linked to the incentive fee. CPIF contracts typically tie incentives to factors like cost savings, schedule adherence, or technical performance. The Federal Aviation Administration would need to have clearly defined, measurable metrics and a robust system for tracking contractor performance against these metrics to ensure the incentive fee structure drives desired outcomes and provides value.
Given the 12-year duration, what provisions are in place to manage technological obsolescence and ensure the reconstructed DAFIS UDO remains effective?
The contract's 12-year lifespan presents a significant risk of technological obsolescence. While the data doesn't detail specific clauses, effective management would require provisions for technology refresh cycles, modular design principles, and regular reviews of emerging technologies. The FAA likely needs to actively engage with Lockheed Martin to plan for upgrades or replacements to ensure the system's continued relevance and operational effectiveness throughout its lifecycle.
How does the 'Other Communications Equipment Manufacturing' classification align with the DAFIS UDO system's known functions, and what are the potential downstream impacts?
The 'Other Communications Equipment Manufacturing' classification suggests the DAFIS UDO reconstruction involves the development or significant modification of specialized communication hardware or related manufacturing processes. This could impact air traffic control, data transmission, or other critical aviation communication infrastructure. The downstream impacts depend on the specific functions of DAFIS UDO, but could range from improved system reliability to potential integration challenges with existing or future communication technologies.
Industry Classification
NAICS: Manufacturing › Communications Equipment Manufacturing › Other Communications Equipment Manufacturing
Product/Service Code: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 9211 CORPORATE BLVD, ROCKVILLE, MD, 20850
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $4,500,000,000
Exercised Options: $3,872,658,643
Current Obligation: $3,829,863,945
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Timeline
Start Date: 2009-10-24
Current End Date: 2021-12-31
Potential End Date: 2021-12-31 00:00:00
Last Modified: 2018-03-20
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