DoD's $159M Facilities Support Contract with PAE Applied Technologies Faces Scrutiny for Value and Competition
Contract Overview
Contract Amount: $159,278,255 ($159.3M)
Contractor: PAE Applied Technologies LLC
Awarding Agency: Department of Defense
Start Date: 2014-04-01
End Date: 2020-09-27
Contract Duration: 2,371 days
Daily Burn Rate: $67.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: IGF::CT::IGF RANGE OPERATION SERVICE
Place of Performance
Location: FORT WORTH, TARRANT County, TEXAS, 76102
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $159.3 million to PAE APPLIED TECHNOLOGIES LLC for work described as: IGF::CT::IGF RANGE OPERATION SERVICE Key points: 1. The contract awarded to PAE Applied Technologies LLC for facilities support services represents a significant expenditure of $159.28 million. 2. While awarded under full and open competition, the contract type (Cost Plus Fixed Fee) warrants close examination for potential cost overruns. 3. The duration of the contract (2371 days) and its location in Texas are key parameters for assessing its scope and impact. 4. The absence of small business participation is noted, potentially limiting broader economic benefits.
Value Assessment
Rating: questionable
The Cost Plus Fixed Fee contract type can lead to higher costs compared to fixed-price contracts, especially for services with predictable scopes. Without detailed cost breakdowns and performance metrics, assessing the true value for money is challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, suggesting a competitive bidding process. However, the Cost Plus Fixed Fee structure might incentivize higher spending, potentially diminishing the price discovery benefits of competition.
Taxpayer Impact: Taxpayer funds totaling $159.28 million are committed to this contract, with the potential for increased costs due to the contract type.
Public Impact
Significant federal investment in facilities support services impacting military readiness and operations. Potential for cost efficiencies or overruns directly affects the defense budget and taxpayer burden. The contract's duration suggests a long-term need for these services, highlighting the importance of sustained performance and value. Lack of small business involvement may represent a missed opportunity for economic development and diverse supplier engagement.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type
- No small business participation
- Long contract duration
Positive Signals
- Awarded under full and open competition
- Clear need for facilities support services
Sector Analysis
This contract falls within the Facilities Support Services sector, which is crucial for maintaining operational readiness across government agencies, particularly the Department of Defense. Spending benchmarks in this sector vary widely based on the scope and complexity of services required.
Small Business Impact
The contract explicitly states no small business participation (sb: false). This indicates that prime contractor PAE Applied Technologies LLC did not subcontract with small businesses for this award, potentially missing opportunities to foster small business growth and innovation within the defense industrial base.
Oversight & Accountability
Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA). Given the Cost Plus Fixed Fee structure and long duration, robust oversight is critical to ensure cost control, performance standards, and compliance with contract terms.
Related Government Programs
- Facilities Support Services
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Cost Plus Fixed Fee contract type may lead to higher costs.
- Lack of small business participation.
- Long contract duration increases exposure to potential cost increases and performance degradation.
- Potential for cost overruns due to contract type.
Tags
facilities-support-services, department-of-defense, tx, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $159.3 million to PAE APPLIED TECHNOLOGIES LLC. IGF::CT::IGF RANGE OPERATION SERVICE
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 (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $159.3 million.
What is the period of performance?
Start: 2014-04-01. End: 2020-09-27.
What specific performance metrics were used to justify the $159M expenditure over the contract's life, and how were they measured?
Detailed performance metrics are not provided in the summary data. For a Cost Plus Fixed Fee contract of this magnitude, the government would ideally establish Key Performance Indicators (KPIs) related to service availability, response times, maintenance quality, and cost control. Regular performance reviews and audits would be essential to ensure these metrics are met and that the contractor is delivering value commensurate with the costs incurred.
How did the 'full and open competition' process ensure the most cost-effective solution was chosen, given the Cost Plus Fixed Fee structure?
Full and open competition aims to solicit offers from all responsible sources. While it ensures a broad pool of potential bidders, the Cost Plus Fixed Fee (CPFF) structure itself can introduce challenges in achieving the most cost-effective outcome. CPFF contracts reimburse the contractor for allowable costs plus a fixed fee representing profit. This structure is often used when the scope is uncertain, but it can reduce the contractor's incentive to control costs. Effective price negotiation and rigorous oversight are crucial to mitigate this risk.
What is the potential risk of cost overruns with this CPFF contract, and what mitigation strategies were in place?
The primary risk with CPFF contracts is cost overrun, as the contractor is reimbursed for actual costs incurred. Mitigation strategies typically include establishing realistic cost estimates, defining allowable costs strictly, implementing robust monitoring and reporting mechanisms, conducting regular audits, and setting clear ceilings or target costs. The government's ability to manage and oversee these elements is paramount to controlling expenditures under such contracts.
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
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N0024414R0001
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 1320 N COURTHOUSE RD STE 700, ARLINGTON, VA, 22201
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $167,597,135
Exercised Options: $166,220,987
Current Obligation: $159,278,255
Actual Outlays: $5,548,074
Subaward Activity
Number of Subawards: 63
Total Subaward Amount: $6,819,092
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2014-04-01
Current End Date: 2020-09-27
Potential End Date: 2020-09-27 00:00:00
Last Modified: 2024-11-05
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