DOT awards $20.7M contract for NEW MICRO-EARTS SUSTAINMENT to Lockheed Martin Services, LLC

Contract Overview

Contract Amount: $20,748,193 ($20.7M)

Contractor: Lockheed Martin Services, LLC

Awarding Agency: Department of Transportation

Start Date: 2005-03-25

End Date: 2009-12-31

Contract Duration: 1,742 days

Daily Burn Rate: $11.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: NEW MICRO-EARTS SUSTAINMENT CONTRACT

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850

State: Maryland Government Spending

Plain-Language Summary

Department of Transportation obligated $20.7 million to LOCKHEED MARTIN SERVICES, LLC for work described as: NEW MICRO-EARTS SUSTAINMENT CONTRACT Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of 1742 days (approximately 4.7 years) indicates a long-term need for sustainment services. 3. Awarded to a single contractor, Lockheed Martin Services, LLC, for specialized engineering services. 4. The contract type is Time and Materials, which can pose cost control risks if not managed closely. 5. The North American Industry Classification System (NAICS) code 541330 points to engineering services, a critical component of the FAA's operations. 6. The contract was awarded in March 2005 and completed in December 2009, providing historical context for spending.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without comparable sustainment contracts for similar systems. The Time and Materials (T&M) pricing structure, while common for evolving needs, can lead to higher costs if not carefully monitored for scope creep and efficiency. The total award amount of $20.7 million over nearly five years suggests a moderate investment for sustainment services, but a detailed cost-benefit analysis would be needed to fully assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 3 bidders suggests a reasonable level of competition for this specialized service. While not a large number, it implies that multiple firms had the capability and interest to pursue the contract, which generally aids in price discovery and achieving a fair market price.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation, leading to better value for public funds.

Public Impact

The Federal Aviation Administration (FAA) benefits from the sustained operation of the MICRO-EARTS system, crucial for air traffic management. This contract ensures the continued functionality and reliability of critical aviation infrastructure. The services delivered support the safety and efficiency of the National Airspace System. The primary geographic impact is within the United States, supporting FAA operational centers and facilities. While not directly a workforce creation contract, it supports specialized engineering and technical roles within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type can lead to cost overruns if not managed diligently.
Lack of specific performance metrics in the provided data makes it difficult to assess contractor efficiency.
The contract is for sustainment, implying a focus on maintenance rather than new development, which might limit innovation.

Positive Signals

Awarded through full and open competition, indicating a competitive process.
The contract duration suggests a stable, long-term requirement met by the award.
The contractor, Lockheed Martin Services, LLC, is a well-established entity in the aerospace and defense sector.

Sector Analysis

The aerospace and defense sector, particularly within engineering services, is characterized by complex, high-value contracts often awarded through competitive bidding. The FAA's need for sustainment services for critical systems like MICRO-EARTS falls within this domain. Spending in this sector is driven by national security, infrastructure modernization, and technological advancement. Comparable spending benchmarks would typically involve other large-scale sustainment or maintenance contracts for complex government systems, often in the tens to hundreds of millions of dollars.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Lockheed Martin Services, LLC is a large prime contractor. There is no explicit information on subcontracting plans for small businesses within this data snippet. Therefore, the direct impact on the small business ecosystem is likely limited unless significant subcontracting opportunities were pursued by the prime contractor.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Transportation's Office of Inspector General (OIG) and the Federal Aviation Administration's internal program management. Transparency is generally facilitated through contract award databases like FPDS. Accountability measures would be tied to the performance clauses within the Time and Materials contract, requiring diligent monitoring of hours, rates, and deliverables by the contracting officer's representative (COR).

Related Government Programs

FAA Air Traffic Control Systems
Aviation Systems Sustainment
Engineering Services Contracts
Department of Transportation IT Infrastructure

Risk Flags

Time and Materials contract type
Potential for cost overruns
Limited data on performance metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $20.7 million to LOCKHEED MARTIN SERVICES, LLC. NEW MICRO-EARTS SUSTAINMENT CONTRACT

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 $20.7 million.

What is the period of performance?

Start: 2005-03-25. End: 2009-12-31.

What is the track record of Lockheed Martin Services, LLC with the Department of Transportation and the FAA for similar sustainment contracts?

Lockheed Martin Services, LLC, as a subsidiary of Lockheed Martin Corporation, has a long history of providing complex services and systems to government agencies, including the Department of Transportation and the FAA. While specific details on their track record for the MICRO-EARTS sustainment contract are limited to the award data provided, the company's extensive experience in aerospace, defense, and government IT suggests a capacity to handle such requirements. Their broader portfolio includes air traffic management systems, aviation security technology, and various engineering and logistics support services. A deeper dive into historical contract performance reviews, past performance questionnaires, and any documented issues or successes related to similar FAA contracts would provide a more comprehensive understanding of their specific track record for this type of work.

How does the $20.7 million award compare to other FAA sustainment contracts for critical systems?

The $20.7 million award for the MICRO-EARTS sustainment contract over approximately 4.7 years represents an average annual value of roughly $4.4 million. This figure is moderate when compared to the full spectrum of FAA sustainment contracts. Larger, more complex systems, such as major air traffic control platforms (e.g., NextGen components) or large-scale IT infrastructure overhauls, can command contract values ranging from tens of millions to hundreds of millions of dollars over similar or longer periods. Smaller, more specialized equipment sustainment might fall below this amount. Therefore, this contract appears to be of mid-range value for sustainment of a critical, but perhaps not the most expansive, FAA system.

What are the primary risks associated with a Time and Materials (T&M) contract for system sustainment?

The primary risk with a Time and Materials (T&M) contract, like the one awarded for MICRO-EARTS sustainment, is the potential for cost escalation. Unlike fixed-price contracts, T&M agreements reimburse the contractor for the actual labor hours and material costs incurred, plus a fee or profit margin. This structure can incentivize longer task durations or less efficient work if not rigorously overseen. For taxpayers, this means the final cost is not precisely known at the outset and can exceed initial estimates. Effective risk mitigation requires strong government oversight, detailed tracking of labor hours and materials, clear definition of tasks, and proactive management by the Contracting Officer's Representative (COR) to ensure the work is necessary, efficient, and within scope.

What was the effectiveness of the competition for this contract, given 3 bidders?

With three bidders participating in the full and open competition for the MICRO-EARTS sustainment contract, the level of competition can be considered fair to good. While more bidders generally lead to greater price pressure and potentially better value, three offers indicate that the requirement was sufficiently defined and accessible to multiple capable firms. This number suggests that the market had at least a few players with the necessary technical expertise and capacity. The effectiveness of this competition in achieving optimal value would depend on the specific proposals submitted, the evaluation criteria used, and the negotiation process. However, having multiple bids is a positive indicator for price discovery and avoiding a sole-source or limited-source situation.

How has federal spending on engineering services (NAICS 541330) evolved, and where does this contract fit?

Federal spending on engineering services (NAICS 541330) is substantial and fluctuates based on infrastructure needs, defense spending, and technological modernization initiatives across various agencies. This sector consistently represents billions of dollars annually. The $20.7 million MICRO-EARTS sustainment contract awarded by the FAA fits within this broader category as a specific instance of engineering services supporting critical operational systems. It reflects the government's ongoing investment in maintaining and ensuring the reliability of complex technological infrastructure, particularly in high-stakes domains like aviation. This contract's value is modest in the context of the overall federal engineering services spend but significant for the specific system it supports.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 9211 CORPORATE BLVD, ROCKVILLE, MD, 08

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Federally Funded Research and Development Corp, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $592,127,659

Exercised Options: $20,748,193

Current Obligation: $20,748,193

Timeline