DHS awards $19.6M contract for aircraft manufacturing to Sierra Nevada Company, LLC

Contract Overview

Contract Amount: $19,573,564 ($19.6M)

Contractor: Sierra Nevada Company, LLC

Awarding Agency: Department of Homeland Security

Start Date: 2012-12-19

End Date: 2014-04-18

Contract Duration: 485 days

Daily Burn Rate: $40.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MEA

Place of Performance

Location: HAGERSTOWN, WASHINGTON County, MARYLAND, 21740

State: Maryland Government Spending

Plain-Language Summary

Department of Homeland Security obligated $19.6 million to SIERRA NEVADA COMPANY, LLC for work described as: MEA Key points: 1. Contract value of $19.6M for aircraft manufacturing services. 2. Awarded under full and open competition, indicating a broad market solicitation. 3. Contract duration of 485 days suggests a focused, short-term project. 4. Firm Fixed Price contract type aims to control costs and provide predictability. 5. The North American Industry Classification System (NAICS) code 336411 points to aircraft manufacturing. 6. The contract was awarded by the Department of Homeland Security (DHS) to U.S. Customs and Border Protection (CBP).

Value Assessment

Rating: fair

Benchmarking the value of this $19.6M contract is challenging without specific deliverables. However, for aircraft manufacturing, this amount could represent a significant component or a smaller specialized aircraft. Comparing it to similar CBP procurements for aircraft modification or manufacturing would provide better context. The firm fixed-price structure suggests an attempt to manage cost overruns, but the overall value-for-money depends heavily on the quality and performance of the delivered aircraft.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' meaning all responsible sources were permitted to submit a bid. With 7 bidders, this indicates a healthy level of competition for this requirement. A competitive environment generally leads to better pricing and innovation as contractors vie for the award.

Taxpayer Impact: A competitive award process is beneficial for taxpayers as it helps ensure the government receives fair market value for its spending and avoids inflated prices that might occur with less competition.

Public Impact

This contract directly benefits the U.S. Customs and Border Protection (CBP) by providing necessary aircraft for border security and enforcement operations. The services delivered likely involve the manufacturing or modification of aircraft critical for surveillance, interdiction, and transportation missions. The geographic impact is primarily focused on U.S. borders and operational areas where CBP conducts its missions. The contract supports the aerospace manufacturing workforce, potentially creating or sustaining jobs in skilled labor within the defense and aerospace sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific performance metrics makes it difficult to assess the true value and effectiveness of the delivered aircraft.
The relatively short contract duration might indicate a need for ongoing, potentially more expensive, follow-on contracts.
Without detailed specifications, it's hard to determine if the chosen aircraft meets the evolving technological needs of CBP.

Positive Signals

The use of 'full and open competition' suggests a robust process that likely yielded competitive pricing.
The 'firm fixed price' contract type provides cost certainty for the government, mitigating the risk of budget overruns.
The award to Sierra Nevada Company, LLC, a known entity in aerospace, suggests a degree of confidence in their capabilities.

Sector Analysis

The aircraft manufacturing sector is a critical component of the aerospace industry, characterized by high technological demands and significant capital investment. This contract falls within the defense and public safety sub-sector, where government procurement plays a substantial role. Spending in this area is often driven by national security and border control needs. Comparable spending benchmarks would involve analyzing other DHS or Department of Defense contracts for similar aircraft types or manufacturing services.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal, with the primary beneficiaries being larger aerospace manufacturers and their direct suppliers.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Homeland Security's internal procurement and program management offices. The U.S. Customs and Border Protection would be responsible for monitoring performance and ensuring compliance with contract terms. Transparency is generally maintained through contract award databases, though specific performance details may be sensitive. The DHS Office of Inspector General could investigate any allegations of fraud, waste, or abuse.

Related Government Programs

DHS Aircraft Procurement
CBP Aviation Assets
Aerospace Manufacturing Contracts
Border Security Technology

Risk Flags

Potential for schedule delays in complex manufacturing.
Dependence on specific component suppliers.
Ensuring long-term operational readiness and maintenance support.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $19.6 million to SIERRA NEVADA COMPANY, LLC. MEA

Who is the contractor on this award?

The obligated recipient is SIERRA NEVADA COMPANY, LLC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $19.6 million.

What is the period of performance?

Start: 2012-12-19. End: 2014-04-18.

What specific type of aircraft was manufactured or modified under this contract, and what were its intended operational capabilities for CBP?

The provided data does not specify the exact type of aircraft manufactured or modified. However, given the contractor (Sierra Nevada Company, LLC) and the agency (U.S. Customs and Border Protection), it is likely related to surveillance, patrol, or transport aircraft used for border security missions. CBP operates a diverse fleet including fixed-wing aircraft and helicopters for aerial surveillance, interdiction, and personnel transport. The specific capabilities would depend on the aircraft's role, potentially including advanced sensor integration, communication systems, and endurance for long-duration flights over border regions.

How does the $19.6 million contract value compare to other similar aircraft manufacturing or modification contracts awarded by CBP or DHS in the past five years?

Without access to a comprehensive database of CBP and DHS aircraft contracts, a precise comparison is difficult. However, $19.6 million is a substantial sum, suggesting it could cover the production of a specialized aircraft, a significant modification of an existing platform, or a small fleet of less complex aircraft. For context, major defense aircraft programs can run into hundreds of millions or billions of dollars. Smaller, specialized aircraft or significant upgrades for existing platforms procured by agencies like CBP often fall within the multi-million dollar range. A detailed analysis would require comparing this contract's scope (e.g., new build vs. modification, aircraft size and complexity) against other awarded contracts.

What were the key performance indicators (KPIs) or technical requirements outlined in the contract, and how was Sierra Nevada Company, LLC's performance measured against them?

The provided data does not include the specific Key Performance Indicators (KPIs) or technical requirements of the contract. Typically, for aircraft manufacturing, KPIs would include adherence to design specifications, airworthiness standards, delivery timelines, performance metrics (e.g., speed, range, payload capacity), and reliability. Performance measurement would involve rigorous testing, acceptance trials, and potentially post-delivery operational evaluations. The firm fixed-price nature suggests that meeting these defined technical requirements within budget was paramount.

Given the 'full and open competition' and 7 bidders, what was the estimated cost savings or price reduction achieved compared to the government's initial estimate or a sole-source scenario?

While the data confirms 'full and open competition' with 7 bidders, it does not provide the government's initial estimate or the winning bid price relative to other bids. However, a competitive environment with multiple bidders generally leads to price discovery and can result in significant savings compared to a sole-source award. The presence of 7 bidders suggests that the market was sufficiently interested and capable, increasing the likelihood that the winning bid represented a competitive market price. Quantifying the exact savings would require comparing the awarded price against the government's baseline estimate or the next highest bid.

What is Sierra Nevada Company, LLC's track record with DHS and other federal agencies for similar aircraft manufacturing or complex technology integration contracts?

Sierra Nevada Company, LLC (SNC) has a significant track record with various U.S. federal agencies, including the Department of Defense and DHS. They are known for their work in aerospace, aviation, and defense electronics, including aircraft modification, sensor integration, and specialized platform development. Their involvement in complex technology integration is well-documented. For CBP specifically, SNC has previously been involved in providing intelligence, surveillance, and reconnaissance (ISR) aircraft and related technologies. This contract likely builds upon that established relationship and demonstrated capability within the federal contracting space.

What are the potential risks associated with this contract, such as technical challenges, schedule delays, or cost overruns, and what mitigation strategies were likely in place?

Potential risks for an aircraft manufacturing contract include technical challenges in meeting complex specifications, unforeseen design issues, difficulties in sourcing specialized components, and schedule delays due to production complexities or supply chain disruptions. Cost overruns are less likely with a Firm Fixed Price (FFP) contract, as the contractor assumes most of the financial risk. However, if scope changes occur, they could lead to contract modifications and increased costs. Mitigation strategies likely included detailed technical reviews, robust project management by both the contractor and CBP, clear contract terms, and potentially performance bonds. The FFP structure itself acts as a primary risk mitigation tool for the government regarding cost.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 7

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 444 SALOMON CIR, SPARKS, NV, 02

Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Subchapter S Corporation, Woman Owned Business

Financial Breakdown

Contract Ceiling: $19,573,564

Exercised Options: $19,573,564

Current Obligation: $19,573,564

Parent Contract

Parent Award PIID: HSBP1009D02370

IDV Type: IDC

Timeline