DoD's $160M Boeing Contract for UAS ISR Services: A Sole-Source Award with Limited Competition

Contract Overview

Contract Amount: $159,557,723 ($159.6M)

Contractor: THE Boeing Company (0674)

Awarding Agency: Department of Defense

Start Date: 2009-04-13

End Date: 2011-05-31

Contract Duration: 778 days

Daily Burn Rate: $205.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: UAS ISR DEPLOYMENT SERVICES

Place of Performance

Location: SAINT LOUIS, ST. LOUIS County, MISSOURI, 63134

State: Missouri Government Spending

Plain-Language Summary

Department of Defense obligated $159.6 million to THE BOEING COMPANY (0674) for work described as: UAS ISR DEPLOYMENT SERVICES Key points: 1. The contract's value of approximately $160 million over its period of performance suggests a significant investment in Unmanned Aerial System (UAS) Intelligence, Surveillance, and Reconnaissance (ISR) capabilities. 2. Awarded as a sole-source contract to The Boeing Company, this indicates a lack of broad market competition for these specific services. 3. The 'NOT COMPETED' status raises questions about potential missed opportunities for cost savings through a more competitive bidding process. 4. The contract duration of 778 days (approximately 2 years) provides a stable, long-term engagement for the contractor. 5. The firm-fixed-price contract type shifts performance risk to the contractor, potentially leading to more predictable costs for the government. 6. The absence of small business set-aside flags suggests this contract was not specifically targeted to encourage small business participation.

Value Assessment

Rating: questionable

Benchmarking the value of this $160 million contract is challenging without specific performance metrics or comparable sole-source awards for UAS ISR deployment services. However, sole-source awards inherently limit the government's ability to leverage market competition to drive down prices. The absence of a competitive process means there's no direct market validation of whether this price represents optimal value for the services rendered. Further analysis would require understanding the unique capabilities provided by Boeing and comparing them to potential alternatives, if any existed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple potential vendors. The 'NOT COMPETED' designation indicates that the Department of the Navy identified a specific need that they determined could only be met by The Boeing Company, or that circumstances precluded a competitive solicitation. This lack of competition limits the government's ability to explore a range of solutions and pricing from the market.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as the government does not benefit from the price reductions typically achieved through competitive bidding. It also limits opportunities for other capable companies to secure government contracts.

Public Impact

The primary beneficiary of this contract is the Department of the Navy, which receives enhanced Intelligence, Surveillance, and Reconnaissance capabilities through UAS deployment. The services delivered likely include the operation, maintenance, and deployment of UAS platforms for data collection and situational awareness. The geographic impact is likely focused on operational theaters where naval forces are deployed, providing critical intelligence for mission success. Workforce implications may include the need for specialized personnel to operate and maintain the UAS systems, potentially involving both military and contractor personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in higher costs than a competed contract.
Sole-source awards can reduce transparency in pricing and service delivery.
Dependence on a single contractor for critical ISR capabilities could pose a risk if performance issues arise.
The specific technical requirements may be highly specialized, potentially limiting future vendor options.

Positive Signals

Award to a large, established defense contractor like Boeing suggests a high level of confidence in their ability to deliver complex services.
Firm-fixed-price contract type provides cost certainty for the government.
Long contract duration offers stability and predictability for the program.
The focus on UAS ISR aligns with modern military operational needs.

Sector Analysis

The Unmanned Aerial System (UAS) Intelligence, Surveillance, and Reconnaissance (ISR) sector is a rapidly growing segment of the defense industry. This contract fits within the broader professional, scientific, and technical services category, specifically supporting advanced military operations. The market for UAS ISR services is characterized by significant technological advancements and increasing demand from various government agencies. Comparable spending benchmarks would typically involve analyzing other large-scale contracts for similar UAS operations and data analysis services, often awarded to major defense contractors.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The award to a large prime contractor like The Boeing Company suggests that subcontracting opportunities for small businesses may exist, but these are not guaranteed or mandated by the contract structure itself. The impact on the small business ecosystem would depend on Boeing's subcontracting strategy and the availability of small businesses capable of providing specialized support services for UAS ISR deployment.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. Accountability measures are typically embedded within the contract's performance work statement, requiring adherence to specified operational standards and reporting. Transparency is limited due to the sole-source nature of the award; however, contract award data is publicly available. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

Intelligence, Surveillance, and Reconnaissance (ISR) Services
Unmanned Aerial Systems (UAS) Procurement and Support
Department of Defense Professional Services Contracts
Naval Aviation Support Services
Aerospace and Defense Contractor Services

Risk Flags

Sole-source award limits price competition.
Lack of transparency in justification for sole-source award.
Potential for cost overruns without competitive benchmarking.
Dependence on a single contractor for critical ISR capabilities.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $159.6 million to THE BOEING COMPANY (0674). UAS ISR DEPLOYMENT SERVICES

Who is the contractor on this award?

The obligated recipient is THE BOEING COMPANY (0674).

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $159.6 million.

What is the period of performance?

Start: 2009-04-13. End: 2011-05-31.

What specific types of UAS platforms and ISR capabilities were procured under this contract?

The provided data does not specify the exact types of UAS platforms or the detailed ISR capabilities procured. However, given the contractor (The Boeing Company) and the service description ('UAS ISR Deployment Services'), it likely involves advanced systems capable of long-endurance flight, sophisticated sensor payloads (e.g., electro-optical/infrared, radar, signals intelligence), and robust data processing and dissemination functions. These services could encompass platform operation, maintenance, mission planning, data analysis, and potentially integration with existing military command and control networks. The scale of the contract suggests a significant operational footprint rather than a limited research or development effort.

Why was this contract awarded on a sole-source basis instead of being competed?

The data indicates the contract was 'NOT COMPETED' and awarded as a sole-source contract to The Boeing Company. While the specific justification is not provided, common reasons for sole-source awards include unique capabilities possessed by only one vendor, urgent and compelling needs where competition is impractical, or follow-on work to a previous contract where only the original contractor can provide the necessary integration or compatibility. For a large defense contractor like Boeing, it might relate to proprietary technology, existing platform integration, or specialized expertise essential for the specific UAS ISR mission requirements of the Department of the Navy.

How does the $160 million contract value compare to other DoD UAS ISR contracts?

Direct comparison of the $160 million value is difficult without knowing the precise scope and duration of comparable contracts. However, this figure represents a substantial investment in UAS ISR capabilities. Large-scale UAS programs, especially those involving advanced platforms and extensive operational support, can easily reach hundreds of millions or even billions of dollars over their lifecycle. Contracts for ISR services, particularly those requiring specialized platforms and extensive operational support, are typically high-value. The sole-source nature of this award, however, means its value isn't benchmarked against market competition, making direct value-for-money comparisons with competed contracts challenging.

What are the potential risks associated with a sole-source award of this magnitude?

The primary risk associated with a sole-source award of this magnitude is the potential for inflated costs due to the lack of competitive pressure. Without competing bids, the government may not achieve the most favorable pricing. Other risks include a reduced incentive for the contractor to innovate or improve efficiency beyond contractual minimums, and potential vendor lock-in, making it difficult or costly to switch providers in the future. Furthermore, if Boeing encounters performance issues, the government has limited immediate alternatives for replacing the contractor, potentially impacting critical ISR capabilities.

What is the historical spending trend for UAS ISR services within the Department of the Navy?

The provided data only pertains to this single contract awarded in 2009. To assess historical spending trends for UAS ISR services within the Department of the Navy, a broader analysis of contract databases over multiple fiscal years would be necessary. However, it is widely understood that spending on ISR capabilities, particularly those leveraging advanced technologies like UAS, has been on a significant upward trajectory across the Department of Defense for the past two decades, driven by evolving threat landscapes and the recognized value of persistent surveillance and intelligence gathering.

What performance metrics or oversight mechanisms are typically in place for such UAS ISR contracts?

While specific metrics for this contract are not detailed, typical performance metrics for UAS ISR deployment services often include flight hours achieved, mission success rates (e.g., data collection targets met), system uptime and availability, response times for deployment, and data quality/timeliness. Oversight mechanisms usually involve regular program reviews, technical interchange meetings between the government and contractor, performance evaluations against the contract's requirements, and potentially the use of government-furnished equipment or personnel to monitor operations. The firm-fixed-price nature implies that the contractor is responsible for meeting these performance standards within the agreed-upon budget.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: THE Boeing Company (UEI: 009256819)

Address: 6200 J S MCDONNELL BLVD, SAINT LOUIS, MO, 90

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $159,557,723

Exercised Options: $159,557,723

Current Obligation: $159,557,723

Contract Characteristics

Cost or Pricing Data: NO

Timeline