Department of Defense awards $57.6M for satellite services, highlighting potential value concerns
Contract Overview
Contract Amount: $57,569,528 ($57.6M)
Contractor: Satellite Services Inc
Awarding Agency: Department of Defense
Start Date: 2005-01-12
End Date: 2011-01-31
Contract Duration: 2,210 days
Daily Burn Rate: $26.1K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 6
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: 200507!000032!5700!FA4664!452MSG/LGC !FA466405C0001 !A!N! !N! ! !20050112!20060131!050713650!050713650!050713650!N!SATELLITE SERVICES, INC !309 SOUTH FRONT ST !MARQUETTE !MI!49855!45680!065!06!MARCH AFB !RIVERSIDE !CALIFORNIA!+000000091368!N!N!000025599644!M119!OPERATION/OTHER ADMINISTRATIVE & SERVICE BUILDINGS!S1 !SERVICES !000 !* !561210!A!B!3! ! ! ! ! !20200930!B! ! !A! !A!N!J!2!006!K! !C!Y!Z! ! !N!B!N!N! ! !A! !B!A!000!A!B!N! ! ! ! ! !FA4664!0001! !
Place of Performance
Location: MARCH ARB, RIVERSIDE County, CALIFORNIA, 92518
Plain-Language Summary
Department of Defense obligated $57.6 million to SATELLITE SERVICES INC for work described as: 200507!000032!5700!FA4664!452MSG/LGC !FA466405C0001 !A!N! !N! ! !20050112!20060131!050713650!050713650!050713650!N!SATELLITE SERVICES, INC !309 SOUTH FRONT ST !MARQUETTE !MI!49855!45680!065!06!MARCH AFB !RIVE… Key points: 1. Contract awarded for satellite services, with a significant total value. 2. The contract was competed, but the level of competition warrants further examination. 3. Potential for overpayment exists given the duration and cost of the contract. 4. The services provided are critical for operational support. 5. Geographic impact is concentrated in California. 6. Contractor has a history with this type of service.
Value Assessment
Rating: questionable
The total award amount of $57.6 million over a period of approximately 10 years suggests a substantial investment. Benchmarking this against similar satellite service contracts is crucial to determine if the pricing is competitive. Without more granular data on the specific services rendered and their unit costs, it's difficult to definitively assess value for money. However, the extended duration could indicate a need for long-term, stable support, which might justify the overall expenditure if performance has been satisfactory.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which suggests that while competition was sought, certain sources may have been excluded for specific reasons. The number of bidders (6) indicates some level of interest, but the exclusion of sources could limit the full spectrum of competitive pricing. This procurement method requires careful justification to ensure it did not unduly restrict competition and lead to suboptimal pricing for the government.
Taxpayer Impact: While competition was present, the exclusion of certain sources might have prevented the government from achieving the lowest possible price. Taxpayers may have paid more than they would have in a truly unrestricted full and open competition.
Public Impact
The Department of Defense benefits from essential satellite communication and support services. This contract ensures the continuity of critical operational and administrative functions. The primary geographic impact is within California, where the contractor is located. The contract supports the workforce involved in managing and delivering these satellite services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns due to the long contract duration.
- The 'after exclusion of sources' clause needs scrutiny to ensure fair competition.
- Lack of detailed performance metrics makes value assessment challenging.
Positive Signals
- Contract awarded to a single entity, suggesting a focused relationship.
- The contract duration implies a stable and predictable service delivery.
- The services provided are essential for military operations.
Sector Analysis
This contract falls within the broader telecommunications and satellite services sector, a critical component of national defense and infrastructure. The market for satellite services is highly specialized, involving significant technological investment and expertise. Comparable spending benchmarks would likely be found within other large-scale government contracts for communication infrastructure and support, where long-term commitments are common due to the nature of the technology.
Small Business Impact
There is no explicit indication of small business set-asides or subcontracting requirements in the provided data. The contract appears to be awarded to a larger entity, and its impact on the small business ecosystem is not directly evident. Further investigation into subcontracting plans would be necessary to assess any potential benefits or drawbacks for small businesses.
Oversight & Accountability
Oversight mechanisms would typically involve the contracting officer's representative (COR) and the Defense Contract Management Agency (DCMA). Accountability measures are tied to the firm-fixed-price nature of the contract, requiring the contractor to deliver specified services within the agreed-upon cost. Transparency is generally facilitated through contract databases like FPDS, though detailed performance reports may not always be publicly accessible.
Related Government Programs
- Satellite Communications Services
- Information Technology Services
- Defense Communications Infrastructure
- Facilities Support Services
Risk Flags
- Limited competition due to source exclusion.
- Extended contract duration may mask inefficiencies.
- Lack of public performance data hinders value assessment.
Tags
department-of-defense, department-of-the-air-force, satellite-services, facilities-support-services, firm-fixed-price, limited-competition, california, large-contract, information-technology, telecommunications
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $57.6 million to SATELLITE SERVICES INC. 200507!000032!5700!FA4664!452MSG/LGC !FA466405C0001 !A!N! !N! ! !20050112!20060131!050713650!050713650!050713650!N!SATELLITE SERVICES, INC !309 SOUTH FRONT ST !MARQUETTE !MI!49855!45680!065!06!MARCH AFB !RIVERSIDE !CALIFORNIA!+000000091368!N!N!000025599644!M119!OPERATION/OTHER ADMINISTRATIVE & SERVICE BUILDINGS!S1 !SERVICES !000 !* !561210!A!B!3! ! ! ! ! !202
Who is the contractor on this award?
The obligated recipient is SATELLITE SERVICES 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 $57.6 million.
What is the period of performance?
Start: 2005-01-12. End: 2011-01-31.
What is the specific nature of the 'satellite services' provided under this contract?
The provided data indicates the contract is for 'SATELLITE SERVICES, INC' and falls under the North American Industry Classification System (NAICS) code 561210, which covers Facilities Support Services. While the primary description is 'SATELLITE SERVICES, INC', the NAICS code suggests the services might encompass a broader range of facility operations and maintenance, potentially including the management or support of satellite-related infrastructure on the ground, rather than direct satellite operation or data transmission. Further details on the Statement of Work (SOW) would be required to precisely define the scope of services, such as ground station maintenance, communication equipment support, or logistical services related to satellite operations.
How does the awarded amount of $57.6 million compare to similar satellite service contracts awarded by the DoD?
Comparing the $57.6 million award to similar contracts requires access to a broader dataset of DoD satellite service procurements. However, given the contract duration of approximately 10 years (from 2005 to 2011), the average annual spending would be around $5.76 million. This figure needs to be contextualized by the specific services rendered. High-bandwidth data transmission or complex satellite operations typically command higher prices. Without specific details on the service level agreements (SLAs), bandwidth, and operational complexity, a direct comparison is challenging. However, for long-term infrastructure support, this annual average might be within a reasonable range, provided the services are critical and competitively priced.
What were the specific reasons for excluding certain sources in this 'Full and Open Competition After Exclusion of Sources' award?
The designation 'Full and Open Competition After Exclusion of Sources' implies that a competitive process was initiated, but specific potential bidders were deliberately not considered. The reasons for such exclusions are typically documented in the contract file and often relate to factors like national security, proprietary technology, specific security clearances, or unique capabilities that only a limited number of entities possess. Without access to the contract's Justification and Approval (J&A) document, the precise reasons remain unknown. This exclusion method necessitates a strong rationale to ensure that the government's interests are genuinely served and that competition was not unnecessarily stifled.
What is the track record of SATELLITE SERVICES INC with government contracts, particularly within the DoD?
SATELLITE SERVICES INC has been awarded this specific contract by the Department of the Air Force, a branch of the DoD. The data indicates this contract, valued at $57.6 million, ran from January 2005 to January 2011. The presence of this significant contract suggests the company has the capacity and qualifications to handle large-scale government service agreements. Further analysis of their contract history, including past performance reviews, any disputes, or contract terminations, would provide a more comprehensive understanding of their track record and reliability as a government contractor.
Are there any performance metrics or quality assurance evaluations available for this contract?
The provided data does not include specific performance metrics or quality assurance evaluations for this contract. Typically, such information is detailed in the contract's Statement of Work (SOW) and subsequent performance reports. Firm-Fixed-Price contracts generally rely on the contractor meeting predefined deliverables and service levels. The absence of readily available performance data in this summary makes it difficult to assess the contractor's effectiveness and the overall success of the service delivery. Accessing contract performance reports or inspection records would be necessary for a thorough evaluation.
How has spending on satellite services by the Department of Defense evolved since this contract was awarded?
Since the award of this $57.6 million contract (2005-2011), the Department of Defense's spending on satellite services has likely evolved significantly, driven by technological advancements, changing geopolitical landscapes, and increasing demand for secure, high-bandwidth communications. The DoD has increasingly relied on a mix of government-owned and commercial satellite capabilities, including efforts to modernize its satellite constellations and ground infrastructure. Spending patterns may have shifted towards more flexible, cloud-integrated, and resilient communication solutions. Analyzing subsequent contract awards and budget allocations for satellite communications would reveal trends in technology adoption, service providers, and overall investment in this critical domain.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services
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
Offers Received: 6
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 309 SOUTH FRONT ST, MARQUETTE, MI, 01
Business Categories: Category Business, Small Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 2005-01-12
Current End Date: 2011-01-31
Potential End Date: 2011-01-31 00:00:00
Last Modified: 2011-04-18
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