DoD's $404M contract for air transportation support awarded to PAE Applied Technologies shows long duration and firm fixed pricing
Contract Overview
Contract Amount: $404,565,082 ($404.6M)
Contractor: PAE Applied Technologies LLC
Awarding Agency: Department of Defense
Start Date: 2005-01-26
End Date: 2014-03-31
Contract Duration: 3,351 days
Daily Burn Rate: $120.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Place of Performance
Location: FORT WORTH, TARRANT County, TEXAS, 76177
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $404.6 million to PAE APPLIED TECHNOLOGIES LLC for work described as: Key points: 1. The contract's value of over $404 million over its 9-year duration suggests a significant, long-term need for air transportation support services. 2. Firm Fixed Price (FFP) contract type indicates that the contractor bears the risk of cost overruns, potentially leading to greater cost certainty for the government. 3. Awarded by the Department of the Air Force, this contract likely supports critical operational requirements within the defense sector. 4. The absence of small business set-aside flags suggests this contract was not specifically targeted to boost small business participation. 5. The contract's duration of over 3300 days points to a stable, ongoing requirement rather than a short-term project. 6. The North American Industry Classification System (NAICS) code 488190 indicates a focus on support activities for air transportation.
Value Assessment
Rating: fair
Benchmarking the value of this contract is challenging without specific service details or comparable contracts. However, a $404 million award over nearly a decade for specialized air transportation support suggests a substantial investment. The firm fixed-price nature aims to control costs, but the long duration could mask potential inefficiencies if not closely monitored. Without more granular data on the services provided and their unit costs, a definitive value-for-money assessment is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. This competitive process is generally expected to yield fair pricing and good value. The presence of 3 bidders (no=3) suggests a reasonable level of competition for this type of specialized service.
Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down prices through market forces and encouraging innovative solutions from multiple providers.
Public Impact
The primary beneficiaries are likely the U.S. Air Force units and personnel relying on the air transportation support services. Services delivered are expected to encompass a range of activities crucial for the operation and maintenance of air transportation infrastructure and logistics. The geographic impact is likely concentrated around the Air Force bases or operational areas where these support services are rendered, potentially within Texas (ST=TX). Workforce implications include the creation or sustainment of jobs for individuals with expertise in air transportation logistics, maintenance, and operations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration may lead to complacency or reduced incentive for continuous improvement if not actively managed.
- Lack of specific performance metrics makes it difficult to assess the effectiveness and efficiency of the services provided over time.
- Potential for scope creep or unmonitored cost increases if the firm fixed-price contract is not rigorously administered.
- Limited transparency on specific service delivery and outcomes hinders public understanding of the contract's impact.
Positive Signals
- Firm Fixed Price (FFP) contract type shifts cost overrun risk to the contractor, providing budget certainty.
- Full and open competition suggests a robust process that likely resulted in a competitive price.
- The contract's long duration indicates a stable, ongoing need that the selected contractor is capable of fulfilling.
- Awarded by a major defense agency (Department of Defense), implying adherence to stringent procurement standards.
Sector Analysis
This contract falls within the broader aerospace and defense services sector, specifically focusing on air transportation support. This sector is characterized by high barriers to entry, specialized technical requirements, and significant government spending. The market size for such specialized support services is substantial, driven by the operational needs of military branches. Comparable spending benchmarks would typically involve other large-scale support contracts for aviation logistics, maintenance, and ground operations within the Department of Defense.
Small Business Impact
The contract was not awarded as a small business set-aside (SB=false), and there is no indication of specific subcontracting goals for small businesses. This suggests that the primary focus was on securing the best value through full and open competition, rather than prioritizing small business participation. Consequently, the direct impact on the small business ecosystem may be limited unless the prime contractor voluntarily engages small businesses for subcontracting opportunities.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the relevant program management office within the Department of the Air Force. Accountability measures are embedded in the contract terms, including performance standards and reporting requirements, though specific details are not provided. Transparency is generally facilitated through contract award databases, but detailed operational oversight and Inspector General jurisdiction would depend on the specific nature of the services and any subsequent investigations or audits.
Related Government Programs
- Air Mobility Command Contracts
- Logistics and Base Support Contracts
- Aviation Maintenance Services
- Defense Transportation Services
- Airfield Operations Support
Risk Flags
- Long contract duration may increase risk of requirement obsolescence or contractor complacency.
- Lack of detailed performance metrics limits assessment of value and efficiency.
- Potential for cost growth if contract administration is not rigorous, despite FFP.
- Limited transparency on specific service delivery outcomes.
Tags
defense, department-of-defense, department-of-the-air-force, definitive-contract, firm-fixed-price, full-and-open-competition, air-transportation-support, large-contract, long-duration, texas, support-activities
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $404.6 million to PAE APPLIED TECHNOLOGIES LLC. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is PAE APPLIED TECHNOLOGIES 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 $404.6 million.
What is the period of performance?
Start: 2005-01-26. End: 2014-03-31.
What specific air transportation support services were included under this contract?
The provided data indicates the contract falls under NAICS code 488190, 'Other Support Activities for Air Transportation.' This typically encompasses a range of services such as airport operations, air traffic control support, aircraft maintenance and repair services (excluding manufacturing), cargo handling, fueling services, and other ground support activities essential for air operations. However, the exact scope of services for this specific $404 million contract awarded to PAE Applied Technologies is not detailed in the summary data. Further investigation into the contract's statement of work (SOW) would be necessary to ascertain the precise deliverables, such as specific maintenance tasks, operational support hours, or logistical functions provided to the Air Force.
How does the $404 million contract value compare to similar air transportation support contracts awarded by the DoD?
Comparing this $404 million contract value requires context regarding its duration and the specific services rendered. Awarded in 2005 and ending in 2014, this represents an average annual value of approximately $45 million. This figure is substantial and aligns with large-scale, long-term support contracts common within the Department of Defense for critical infrastructure and operational needs. Without access to a comprehensive database of comparable contracts, it's difficult to provide precise benchmarks. However, contracts for base operations support, aviation maintenance, and logistics for major air bases often reach into the tens or hundreds of millions of dollars over multi-year periods, suggesting this contract was significant but not necessarily an outlier in the defense spending landscape.
What were the key performance indicators (KPIs) used to evaluate PAE Applied Technologies' performance under this contract?
The provided summary data does not include specific Key Performance Indicators (KPIs) or performance metrics that were used to evaluate PAE Applied Technologies. For a firm fixed-price contract of this magnitude and duration, typical KPIs would likely focus on areas such as on-time delivery of services, aircraft availability rates, maintenance turnaround times, safety incident rates, compliance with technical specifications, and potentially customer satisfaction metrics from the end-users within the Air Force. The effectiveness of oversight would depend on the rigor with which these, or similar, KPIs were defined, monitored, and enforced by the contracting officer's representative (COR) throughout the contract's lifecycle.
What is the historical spending trend for 'Other Support Activities for Air Transportation' by the Department of the Air Force?
The provided data focuses on a single contract (ID 488190) awarded in 2005. To understand the historical spending trend for 'Other Support Activities for Air Transportation' (NAICS 488190) by the Department of the Air Force, a broader analysis of contract awards over multiple fiscal years would be required. This would involve querying federal procurement databases (like FPDS or USASpending) for all contracts under this NAICS code awarded by the Air Force. Such an analysis would reveal whether spending in this category has been consistent, increasing, or decreasing, and identify major contractors and contract types prevalent in this sub-sector. This specific contract represents a significant portion of spending within a single year but does not provide a trend on its own.
Were there any significant risks or challenges identified during the performance of this contract?
The summary data does not explicitly detail any significant risks or challenges encountered during the performance of this contract. However, given its long duration (over 9 years) and substantial value ($404 million), potential risks could have included changes in operational requirements, technological obsolescence affecting support needs, contractor performance issues, or unforeseen geopolitical events impacting air operations. The firm fixed-price nature places the burden of managing cost-related risks on the contractor. Effective contract management by the Air Force would have been crucial in mitigating performance-related risks and ensuring the continued delivery of essential support services.
Industry Classification
NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Computer Sciences Corporation (UEI: 009581091)
Address: 6500 WEST FWY STE 600, FORT WORTH, TX, 76116
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Timeline
Start Date: 2005-01-26
Current End Date: 2014-03-31
Potential End Date: 2014-03-31 00:00:00
Last Modified: 2016-06-10
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