DoD's $76.4M Boeing Sikorsky contract for air transport support awarded via sole-source, raising cost concerns
Contract Overview
Contract Amount: $76,431,446 ($76.4M)
Contractor: Boeing Sikorsky Aircraft Support, LLC
Awarding Agency: Department of Defense
Start Date: 2023-01-01
End Date: 2023-12-31
Contract Duration: 364 days
Daily Burn Rate: $210.0K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: TRAVEL
Place of Performance
Location: FORT CAMPBELL, CHRISTIAN County, KENTUCKY, 42223
State: Kentucky Government Spending
Plain-Language Summary
Department of Defense obligated $76.4 million to BOEING SIKORSKY AIRCRAFT SUPPORT, LLC for work described as: TRAVEL Key points: 1. Significant contract value of $76.4M for specialized air transportation support. 2. Sole-source award to Boeing Sikorsky Aircraft Support, LLC limits competitive pricing. 3. Potential risk of overpayment due to lack of competition. 4. Contract falls under 'Other Support Activities for Air Transportation' sector.
Value Assessment
Rating: questionable
The contract's $76.4M value for 'Other Support Activities for Air Transportation' is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning competition was not sought. This significantly impacts price discovery, potentially leading to higher costs for taxpayers as there's no market pressure to offer the best price.
Taxpayer Impact: The lack of competition in this sole-source award may result in taxpayers paying more than necessary for these critical air transportation support services.
Public Impact
Taxpayers may be overpaying for essential air transportation support due to the absence of competitive bidding. The reliance on a single provider, Boeing Sikorsky, could impact long-term service availability and cost negotiation. Special Operations Command's need for specialized support highlights potential vulnerabilities if costs are not managed effectively.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for inflated pricing
Positive Signals
- Essential support for Special Operations Command
- Firm fixed price contract type
Sector Analysis
This contract for 'Other Support Activities for Air Transportation' is within the broader aerospace and defense sector. Spending benchmarks for such specialized support are difficult to establish without competitive data, but large sole-source awards warrant scrutiny.
Small Business Impact
The contract was awarded to a large business, Boeing Sikorsky Aircraft Support, LLC. There is no indication of small business participation in this specific award, which is common for large, specialized sole-source contracts.
Oversight & Accountability
The sole-source nature of this award necessitates robust oversight from the Department of Defense and U.S. Special Operations Command to ensure the price paid is fair and reasonable, despite the lack of competition.
Related Government Programs
- Other Support Activities for Air Transportation
- Department of Defense Contracting
- U.S. Special Operations Command Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for cost overruns due to lack of market pressure.
- Limited transparency on pricing justification.
- Dependence on a single contractor for critical support.
Tags
other-support-activities-for-air-transpo, department-of-defense, ky, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $76.4 million to BOEING SIKORSKY AIRCRAFT SUPPORT, LLC. TRAVEL
Who is the contractor on this award?
The obligated recipient is BOEING SIKORSKY AIRCRAFT SUPPORT, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (U.S. Special Operations Command).
What is the total obligated amount?
The obligated amount is $76.4 million.
What is the period of performance?
Start: 2023-01-01. End: 2023-12-31.
What specific justifications were provided for awarding this contract on a sole-source basis, and do they align with federal procurement regulations?
Federal regulations permit sole-source awards under specific circumstances, such as when only one responsible source can provide the required supplies or services. The justification would need to detail why competition was not feasible or would be detrimental to the government's interests, often citing unique capabilities or urgent needs.
How does the government intend to validate the reasonableness of the price paid, given the absence of competitive bids?
The government typically employs various methods to validate pricing for sole-source contracts. This can include conducting detailed cost analyses, reviewing the contractor's cost proposals, benchmarking against historical data for similar services (if available), and negotiating profit margins based on risk and performance.
What is the potential long-term financial impact on the government if this sole-source arrangement continues for similar support needs?
If this sole-source arrangement continues without periodic re-evaluation or competitive re-solicitation, the government risks sustained higher costs compared to a competitive environment. This could lead to significant budget overruns over the contract's lifecycle and limit the government's ability to leverage market innovations and cost efficiencies.
Industry Classification
NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: H9224116R0004
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: THE Boeing Company
Address: 7244B NIGHTSTALKER WAY, FORT CAMPBELL, KY, 42223
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $88,844,015
Exercised Options: $88,844,015
Current Obligation: $76,431,446
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: H9224119D0003
IDV Type: IDC
Timeline
Start Date: 2023-01-01
Current End Date: 2023-12-31
Potential End Date: 2023-12-31 00:00:00
Last Modified: 2023-11-17
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