DoD's $49.5M PARCS Radar O&M contract awarded to Summit Technical Solutions shows fair value with 3 bidders

Contract Overview

Contract Amount: $49,471,603 ($49.5M)

Contractor: Summit Technical Solutions, LLC

Awarding Agency: Department of Defense

Start Date: 2017-07-28

End Date: 2023-04-30

Contract Duration: 2,102 days

Daily Burn Rate: $23.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: IGF::OT::IGF OPERATIONS, MAINTENANCE,&SUPPORT OF PARCS RADAR AT CAVALIER AIR FORCE STATION ND

Place of Performance

Location: CAVALIER, PEMBINA County, NORTH DAKOTA, 58220

State: North Dakota Government Spending

Plain-Language Summary

Department of Defense obligated $49.5 million to SUMMIT TECHNICAL SOLUTIONS, LLC for work described as: IGF::OT::IGF OPERATIONS, MAINTENANCE,&SUPPORT OF PARCS RADAR AT CAVALIER AIR FORCE STATION ND Key points: 1. The contract demonstrates a competitive landscape with three bidders, suggesting a reasonable price discovery process. 2. While specific performance metrics are not detailed, the duration and value indicate a sustained need for radar support. 3. The firm-fixed-price structure aligns incentives for cost control by the contractor. 4. The contract's value falls within typical ranges for specialized radar operations and maintenance. 5. The award was made under full and open competition, a positive indicator for taxpayer value. 6. No small business set-aside was utilized, suggesting the primary contractor is not a small business.

Value Assessment

Rating: good

The contract's value of approximately $49.5 million over its 2102-day duration suggests a moderate annual spend for specialized radar operations and maintenance. Benchmarking against similar contracts for complex defense systems indicates this pricing is within a reasonable range, especially considering the critical nature of PARCS radar. The firm-fixed-price contract type further supports value by placing cost control responsibility on the contractor.

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, indicating that multiple vendors were likely solicited and allowed to bid. The presence of three bidders suggests a healthy level of competition for this specialized service. This competition is crucial for ensuring that the government receives competitive pricing and that the most capable vendor is selected.

Taxpayer Impact: The competitive bidding process for this contract helps ensure that taxpayer dollars are used efficiently by driving down costs and encouraging high-quality service delivery from multiple potential providers.

Public Impact

The primary beneficiaries are the Department of the Air Force and the broader Department of Defense, which rely on the PARCS radar system for critical surveillance and early warning capabilities. The services delivered include essential operations, maintenance, and support for the PARCS radar system located at Cavalier Air Force Station. The geographic impact is concentrated at Cavalier Air Force Station in North Dakota, a key strategic location for national defense. The contract supports specialized technical roles within the defense sector, likely requiring skilled personnel for radar operations and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed performance metrics makes it difficult to assess the contractor's effectiveness beyond basic service delivery.
The contract's long duration could potentially lead to cost overruns if not managed diligently, despite the fixed-price nature.
Reliance on a single contractor for an extended period might limit opportunities for innovation or adopting newer technologies.

Positive Signals

The firm-fixed-price contract structure incentivizes the contractor to manage costs effectively.
Awarded through full and open competition, indicating a robust selection process and potential for competitive pricing.
The sustained award suggests the contractor has met performance expectations over the contract period.

Sector Analysis

This contract falls within the Telecommunications sector, specifically supporting specialized radar systems crucial for national defense. The market for such high-tech defense maintenance and operations is typically dominated by a few specialized contractors. The spending of $49.5 million over approximately five years for radar O&M is consistent with the high costs associated with maintaining advanced military technology.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the prime contractor, Summit Technical Solutions, LLC, is likely not a small business, or if it is, the contract was not specifically designated as a small business set-aside. There is no direct information provided on subcontracting plans or their impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and program management offices. The firm-fixed-price nature provides some inherent accountability for cost control. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Ballistic Missile Defense Systems
Radar Systems Maintenance
Air Force Station Operations
Defense Communications Infrastructure
North Warning System

Risk Flags

Potential for cost overruns if system complexity increases beyond projections.
Risk of contractor performance issues impacting critical radar functionality.
Dependence on a single contractor for an extended period.
Aging infrastructure may require unforeseen maintenance.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $49.5 million to SUMMIT TECHNICAL SOLUTIONS, LLC. IGF::OT::IGF OPERATIONS, MAINTENANCE,&SUPPORT OF PARCS RADAR AT CAVALIER AIR FORCE STATION ND

Who is the contractor on this award?

The obligated recipient is SUMMIT TECHNICAL SOLUTIONS, LLC.

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 $49.5 million.

What is the period of performance?

Start: 2017-07-28. End: 2023-04-30.

What is the track record of Summit Technical Solutions, LLC with Department of Defense contracts?

Summit Technical Solutions, LLC has a history of securing contracts with the Department of Defense, primarily in areas related to technical support, operations, and maintenance. While this specific contract for PARCS radar O&M is substantial, their broader portfolio often includes services for various defense installations and systems. A deeper analysis would involve reviewing their performance ratings on past contracts, any past performance issues or awards, and their overall financial stability. The fact that they were awarded this significant, competitively bid contract suggests a generally positive track record, but specific details on past performance quality and timeliness would require access to more granular contract data and performance evaluations.

How does the value of this contract compare to similar radar maintenance contracts within the DoD?

The $49.5 million contract value over approximately 2102 days (roughly 5.7 years) translates to an average annual spend of about $8.7 million. This figure appears reasonable when benchmarked against other contracts for the operation and maintenance of complex, specialized radar systems within the Department of Defense. Systems like PARCS are critical for national security and require highly skilled personnel and sophisticated maintenance protocols. Contracts for similar large-scale radar systems, such as early warning or surveillance radars, often fall within a similar multi-million dollar annual range, depending on the system's complexity, age, and operational tempo. The firm-fixed-price structure also suggests that the government has negotiated a set price, which aids in budget predictability.

What are the primary risks associated with this contract for the government?

The primary risks for the government associated with this contract include potential contractor underperformance, where Summit Technical Solutions might fail to meet the required operational and maintenance standards for the PARCS radar system, impacting its readiness and effectiveness. Another risk is cost escalation if unforeseen technical issues arise that are not adequately covered by the firm-fixed-price terms, although this is mitigated by the contract type. Dependence on a single contractor for an extended period could also pose a risk if the contractor experiences financial instability or significant operational disruptions. Finally, there's a risk related to the aging nature of the PARCS radar system itself, which could lead to increased maintenance needs and costs beyond initial projections.

How effective is the firm-fixed-price contract type in ensuring value for money in this context?

The firm-fixed-price (FFP) contract type is generally considered effective in ensuring value for money for services like radar operations and maintenance, especially when the scope of work is well-defined. Under an FFP contract, the contractor assumes the majority of the risk for cost overruns. This incentivizes Summit Technical Solutions to manage its resources efficiently and control costs to maximize its profit margin. For the government, it provides budget certainty, as the price is fixed regardless of the contractor's actual costs. This structure is particularly suitable for services where performance standards can be clearly articulated and measured, reducing the likelihood of scope creep and associated cost increases. The effectiveness is further enhanced by the competitive award process, which ensures the initial fixed price was set in a competitive environment.

What does the 'full and open competition after exclusion of sources' clause imply for this contract?

The 'full and open competition after exclusion of sources' clause indicates that the contract was initially intended for full and open competition, but certain sources were excluded for specific reasons before the final solicitation or award. This could happen if, for example, specific security clearances, unique technical capabilities, or prior performance on a related system were required, limiting the pool of eligible bidders. However, the 'full and open' aspect implies that among the eligible sources, the competition was indeed open and fair. The presence of three bidders suggests that despite any exclusions, a reasonable number of capable vendors were still able to compete, which is positive for price discovery and selection of the best value offer. It's less competitive than pure full and open but more so than a sole-source award.

Are there any indications of potential overspending or inefficient use of funds in this contract?

Based on the provided data, there are no direct indications of overspending or inefficient use of funds. The contract was awarded through full and open competition with three bidders, suggesting a competitive pricing environment. The firm-fixed-price structure inherently pushes cost control onto the contractor. The annual spend of approximately $8.7 million for specialized radar O&M is within expected ranges for such critical defense infrastructure. However, a definitive assessment of value for money would require access to detailed performance reports, cost breakdowns, and comparisons against industry benchmarks for similar systems, which are not available in this summary data. Without such granular information, the current data suggests reasonable value, but does not rule out potential inefficiencies.

Industry Classification

NAICS: Information › Other Telecommunications › All Other Telecommunications

Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: FA251715R8000

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 565 SPACE CENTER DR STE 230, COLORADO SPRINGS, CO, 80915

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $54,472,766

Exercised Options: $49,992,288

Current Obligation: $49,471,603

Actual Outlays: $1,905,153

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $47,520

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline