DoD's $793M contract for aircraft equipment maintenance awarded to LB & B Associates Inc. shows potential value concerns

Contract Overview

Contract Amount: $13,301,177 ($13.3M)

Contractor: LB & B Associates Inc

Awarding Agency: Department of Defense

Start Date: 2000-08-11

End Date: 2010-10-22

Contract Duration: 3,724 days

Daily Burn Rate: $3.6K/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: 200012!5700!000198!GE47 !OO-ALC/PKT/YWK !F4263000C0222 !A!*!P00001 !20000811!20010930!793374034!793374034!793374034!N!0V349!L B & B ASSOCIATES, INC !9891 BROKENLAND PKWY !COLUMBIA !MD!21046!19125!027!24!COLUMBIA !HOWARD !MARYLAND !0001!+000000043989!N!N!000000000000!J069!MAINT & REPAIR OF EQ/TRAINING AIDS & DEVICES !A1C!OTHER AIRCRAFT EQUIPMENT !3000!NOT DISCERNABLE OR CLASSIFIED !3728!3!*!*!C!B!A!*!A !N!J!2!002!K!* !C!N!A!* !* !N!A!N!*!*!B!A!A!A!* !B!Y!A!B!N!*!*!*!*!*!

Place of Performance

Location: COLUMBIA, HOWARD County, MARYLAND, 21046

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $13.3 million to LB & B ASSOCIATES INC for work described as: 200012!5700!000198!GE47 !OO-ALC/PKT/YWK !F4263000C0222 !A!*!P00001 !20000811!20010930!793374034!793374034!793374034!N!0V349!L B & B ASSOCIATES, INC !9891 BROKENLAND PKWY !COLUMBIA !MD!21046!19125!027!24!COLUMBIA !HOW… Key points: 1. The contract's total value of $793,374,034 over its life cycle raises questions about cost-effectiveness. 2. Competition was full and open, but the number of bids received (2) warrants further scrutiny for price discovery. 3. The contract's duration of 3724 days (over 10 years) suggests a long-term commitment that requires ongoing performance monitoring. 4. LB & B Associates Inc. is the sole awardee, highlighting the importance of their performance and potential single-source dependency. 5. The contract falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' NAICS code, indicating a specialized sector. 6. The firm fixed-price contract type aims to control costs, but the overall expenditure necessitates careful value assessment.

Value Assessment

Rating: questionable

The total award amount of over $793 million for maintenance and repair of training aids and devices is substantial. Benchmarking this against similar contracts for aircraft equipment maintenance is crucial. Given the long duration and the relatively low number of bids, a detailed cost-benefit analysis is needed to determine if the pricing reflects fair market value and if the services delivered justify the expenditure. Without more granular data on the specific services and their unit costs, it is difficult to definitively 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 After Exclusion of Sources,' which implies that while the competition was open, certain sources may have been excluded for specific reasons. Only two bids were received, which is a relatively low number for a contract of this magnitude. This limited competition could potentially impact price discovery, as fewer bidders may lead to less aggressive pricing strategies.

Taxpayer Impact: A low number of bidders in a full and open competition can mean that the government did not receive the most competitive pricing possible, potentially leading to higher costs for taxpayers.

Public Impact

The primary beneficiaries are the Department of Defense and specifically the Department of the Air Force, ensuring the readiness of training aids and devices. The contract delivers essential maintenance and repair services for aircraft equipment, crucial for effective military training. The geographic impact is likely concentrated around Air Force bases where these training aids are utilized, though the contractor's location in Maryland suggests a potential for broader reach. The contract supports jobs within the aerospace and defense manufacturing sector, particularly in maintenance and repair operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns given the long contract duration and substantial total value.
Risk associated with limited competition (2 bidders) potentially impacting price competitiveness.
Dependency on a single contractor (LB & B Associates Inc.) for critical maintenance services.
Ensuring consistent quality and performance over a decade-long contract period.
The specific nature of 'training aids and devices' may have unique maintenance challenges.

Positive Signals

Awarded under full and open competition, indicating an attempt to maximize the bidder pool.
Firm fixed-price contract type helps to establish cost certainty for the government.
The contractor, LB & B Associates Inc., has secured a significant contract, suggesting a level of established capability.
The contract duration implies a stable, long-term relationship for essential services.
The specific NAICS code points to a specialized area of expertise.

Sector Analysis

This contract operates within the aerospace and defense manufacturing sector, specifically focusing on the maintenance and repair of aircraft-related equipment, including training aids and devices. This sector is characterized by high technological demands, stringent quality requirements, and significant government spending. Comparable spending benchmarks would involve analyzing other large-scale maintenance contracts for military aircraft components and training systems within the Department of Defense.

Small Business Impact

The contract data indicates that this was not a small business set-aside, and the prime contractor, LB & B Associates Inc., is not listed as a small business. Therefore, there are no direct subcontracting implications for small businesses arising from a set-aside provision. However, the large value of the prime contract could present opportunities for small businesses to participate as subcontractors if LB & B Associates Inc. chooses to engage them for specialized services.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense, likely managed by the Department of the Air Force. Accountability measures would be embedded in the contract's performance standards and reporting requirements. Transparency is generally facilitated through contract databases like FPDS, where basic award information is publicly available. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Aircraft Maintenance and Repair Services
Defense Training and Simulation Equipment
Aerospace Parts Manufacturing
Government Fixed-Price Contracts
Department of the Air Force Procurement

Risk Flags

Potential for limited competition impacting price.
Long contract duration requires sustained performance monitoring.
Significant total contract value necessitates rigorous value assessment.
Dependency on a single contractor for critical services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.3 million to LB & B ASSOCIATES INC. 200012!5700!000198!GE47 !OO-ALC/PKT/YWK !F4263000C0222 !A!*!P00001 !20000811!20010930!793374034!793374034!793374034!N!0V349!L B & B ASSOCIATES, INC !9891 BROKENLAND PKWY !COLUMBIA !MD!21046!19125!027!24!COLUMBIA !HOWARD !MARYLAND !0001!+000000043989!N!N!000000000000!J069!MAINT & REPAIR OF EQ/TRAINING AIDS & DEVICES !A1C!OTHER AIRCRAFT EQUIPMENT !3000!NOT DISCERNABLE OR CLASSIFIED !3728!3!*!*!C!B!A!*!A !N!J!

Who is the contractor on this award?

The obligated recipient is LB & B ASSOCIATES INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $13.3 million.

What is the period of performance?

Start: 2000-08-11. End: 2010-10-22.

What is the track record of LB & B Associates Inc. with government contracts, particularly within the Department of Defense?

LB & B Associates Inc. has a history of receiving contracts from the Department of Defense. While this specific contract is substantial, further analysis of their past performance, including any past performance evaluations, contract modifications, or disputes, would provide a clearer picture of their reliability and capability. Examining their award history across different agencies and contract types can reveal patterns in their success rate and adherence to contract terms. Understanding their financial stability and capacity to handle large, long-term contracts is also critical for assessing their track record.

How does the pricing of this contract compare to similar maintenance and repair services for aircraft training aids and devices?

A comprehensive comparison of the pricing for this $793 million contract against similar services is challenging without access to detailed cost breakdowns and specific service level agreements for comparable contracts. However, the fact that it was awarded under 'Full and Open Competition After Exclusion of Sources' with only two bidders suggests that a thorough price analysis was likely conducted by the contracting agency. To benchmark effectively, one would need to identify contracts with similar scope, duration, and complexity, and then analyze their total value, unit costs, and any associated performance metrics. The long duration of over 10 years also complicates direct comparisons with shorter-term contracts.

What are the key performance indicators (KPIs) and risk mitigation strategies associated with this long-term contract?

Key performance indicators for this contract would likely revolve around the timely and effective maintenance and repair of aircraft training aids and devices, ensuring minimal downtime and maximum operational readiness. Risk mitigation strategies would be crucial given the contract's duration and value. These could include phased performance reviews, clear defect resolution processes, contingency planning for contractor performance issues, and potentially price adjustment clauses tied to market fluctuations or performance outcomes. The firm fixed-price nature suggests that the primary risk mitigation for the government lies in clearly defining the scope of work and performance standards upfront.

What is the historical spending pattern for aircraft equipment maintenance and repair within the Department of the Air Force?

Historical spending patterns for aircraft equipment maintenance and repair within the Department of the Air Force are typically substantial, reflecting the high operational tempo and complex needs of air assets. This specific contract, valued at over $793 million, represents a significant investment in ensuring the readiness of training infrastructure. Analyzing past years' spending on similar services, including the number and value of contracts awarded, the types of services procured, and the primary contractors involved, would provide context. Such analysis could reveal trends in outsourcing, technological shifts in maintenance, and the overall budget allocation towards sustainment and training support.

What is the potential impact of 'exclusion of sources' in the competition process on the final contract price?

The 'exclusion of sources' in a 'Full and Open Competition After Exclusion of Sources' award means that while the competition was intended to be open, specific potential bidders were deliberately not considered. The impact on the final contract price can be twofold. If sources were excluded based on specific qualifications or capabilities that only a few possess, it might limit the competitive pool, potentially leading to higher prices than if all qualified sources could bid. Conversely, if sources were excluded for reasons unrelated to capability (e.g., administrative issues), and the remaining pool is still robust, the price might not be significantly affected. However, with only two bidders, the exclusion could have narrowed the field considerably, potentially reducing price pressure.

How does the NAICS code '336413 - Other Aircraft Parts and Auxiliary Equipment Manufacturing' align with the service description 'MAINT & REPAIR OF EQ/TRAINING AIDS & DEVICES'?

The alignment between NAICS code 336413 ('Other Aircraft Parts and Auxiliary Equipment Manufacturing') and the service description ('MAINT & REPAIR OF EQ/TRAINING AIDS & DEVICES') is generally reasonable, though not perfectly direct. NAICS 336413 covers establishments primarily engaged in manufacturing aircraft parts and auxiliary equipment, such as engines, propellers, landing gear, and avionics. While the description focuses on manufacturing, it often encompasses the related repair and remanufacturing activities for these complex components. Training aids and devices often incorporate or simulate these aircraft parts and systems. Therefore, a company specializing in the manufacturing of such parts would likely possess the technical expertise and infrastructure to also maintain and repair them, including their integration into training equipment.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

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: 9891 BROKENLAND PKWY, COLUMBIA, MD, 21046

Business Categories: Asian Pacific American Owned Business, Category Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, U.S.-Owned Business, Woman Owned Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline