Department of the Navy's $45.4M Sikorsky Support Services contract awarded without competition

Contract Overview

Contract Amount: $45,401,141 ($45.4M)

Contractor: Sikorsky Support Services Inc

Awarding Agency: Department of Defense

Start Date: 2015-07-01

End Date: 2016-06-30

Contract Duration: 365 days

Daily Burn Rate: $124.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: DIRECT PARTS, REPAIR PARTS, AND MATERIAL IGF::OT::IGF

Place of Performance

Location: KEY WEST, MONROE County, FLORIDA, 33040

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $45.4 million to SIKORSKY SUPPORT SERVICES INC for work described as: DIRECT PARTS, REPAIR PARTS, AND MATERIAL IGF::OT::IGF Key points: 1. Contract awarded on a sole-source basis, raising questions about price discovery and potential overpayment. 2. Limited competition suggests potential for higher costs compared to a more open bidding process. 3. The firm-fixed-price contract type shifts risk to the contractor, but the lack of competition may negate savings. 4. Performance period of one year with a total value of $45.4M indicates a significant annual expenditure. 5. The contract falls under Aircraft Manufacturing (NAICS 336411), a specialized sector requiring specific expertise. 6. No indication of small business set-aside or subcontracting, potentially limiting opportunities for smaller firms.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the sole-source award and lack of publicly available comparable data. The firm-fixed-price structure is generally favorable for cost control, but without competitive bids, it's difficult to ascertain if the $45.4 million represents a fair market price. The absence of competition means there's no direct comparison to other offers, making it hard to assess if the government received the best possible value for these support services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Sikorsky Support Services Inc., was considered. The justification for this approach is not detailed here, but it typically implies that only one source possesses the necessary capabilities, proprietary knowledge, or that urgent circumstances precluded a competitive process. The lack of multiple bidders significantly limits price discovery and may result in a higher price than would be achieved in a competitive environment.

Taxpayer Impact: Taxpayers may have paid a premium for these services due to the absence of competitive pressure. Without competing offers, there is less assurance that the negotiated price reflects the lowest possible cost for the required support.

Public Impact

The primary beneficiaries are the Department of the Navy, receiving essential support services for its aircraft fleet. Services delivered likely include maintenance, repair, and logistical support for Sikorsky-manufactured aircraft. The geographic impact is concentrated in Florida (ST/SN), where the contract was administered. Workforce implications include employment for skilled technicians and support staff at Sikorsky Support Services Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases costs for taxpayers.
Lack of transparency regarding the justification for sole-source procurement.
No indication of small business participation, potentially excluding smaller firms from subcontracting opportunities.

Positive Signals

Firm-fixed-price contract shifts performance risk to the contractor.
Contract awarded to a known entity, Sikorsky Support Services Inc., suggesting established capabilities.
Specific location of contract performance (Florida) may indicate localized economic benefit.

Sector Analysis

The Aircraft Manufacturing sector (NAICS 336411) is highly specialized, often dominated by a few key players due to the complexity and proprietary nature of aerospace technology. Contracts in this area typically involve high-value, long-term support services. The $45.4 million expenditure for a single year of support is substantial, reflecting the high cost of maintaining sophisticated military aircraft. Comparable spending benchmarks are difficult to establish without more specific details on the services provided and the aircraft models supported.

Small Business Impact

This contract does not appear to have a small business set-aside (SS=false, SB=false). The sole-source nature of the award further limits the possibility of small business subcontracting unless explicitly mandated or voluntarily pursued by the prime contractor. Without specific subcontracting plans or goals outlined, the impact on the small business ecosystem for this particular contract is likely minimal, potentially missing opportunities to foster growth and innovation among smaller aerospace firms.

Oversight & Accountability

Oversight mechanisms for this contract would typically be managed by the Department of the Navy's contracting officers and program managers. Accountability measures are inherent in the firm-fixed-price contract type, which obligates the contractor to deliver specified services within the agreed price. Transparency is limited by the sole-source award, as the justification and negotiation process are not publicly detailed. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Aircraft Maintenance and Repair Services
Aviation Support Contracts
Defense Logistics Support
Helicopter Support Services
Military Aircraft Sustainment

Risk Flags

Sole-source award
Lack of competition
Potential for overpricing
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $45.4 million to SIKORSKY SUPPORT SERVICES INC. DIRECT PARTS, REPAIR PARTS, AND MATERIAL IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is SIKORSKY SUPPORT SERVICES INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $45.4 million.

What is the period of performance?

Start: 2015-07-01. End: 2016-06-30.

What specific aircraft models and support services are covered under this $45.4M contract?

The provided data does not specify the exact aircraft models or the detailed breakdown of support services included in the $45.4 million contract. However, given the contractor (Sikorsky Support Services Inc.) and the NAICS code (336411 - Aircraft Manufacturing), it is highly probable that the contract covers maintenance, repair, overhaul (MRO), and logistical support for Sikorsky-produced helicopters operated by the Department of the Navy. This could include anything from routine inspections and component replacements to more complex structural repairs and software updates, essential for maintaining fleet readiness and operational capability.

What was the justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was awarded as 'NOT COMPETED' (CT: NOT COMPETED), signifying a sole-source procurement. While the specific justification is not detailed in the abbreviated data, common reasons for sole-source awards in defense contracting include: proprietary technology or data held exclusively by the incumbent contractor (Sikorsky), unique capabilities essential for specialized support, urgent and compelling needs where competition is impractical, or if the contract is a follow-on to a previous competitive award where the original contractor's unique knowledge is critical. Without further documentation, the precise rationale remains unknown, but it implies a belief by the agency that only Sikorsky could fulfill the requirement effectively.

How does the annual cost of $45.4M compare to similar support contracts for military helicopters?

Directly comparing the $45.4 million annual cost without knowing the specific fleet size, aircraft types, and scope of services (e.g., full depot-level maintenance vs. line maintenance) is difficult. However, for major military helicopter platforms, annual sustainment costs can range from millions to tens of millions of dollars per aircraft, depending on operational tempo and age. A $45.4 million contract for a significant number of aircraft or extensive support services could be within the expected range for specialized, sole-source support from the original equipment manufacturer or its designated service provider. Benchmarking would require access to data on similar contracts for comparable helicopter fleets.

What is the track record of Sikorsky Support Services Inc. with the Department of the Navy?

Sikorsky Support Services Inc., as a subsidiary or affiliate of Sikorsky Aircraft (a Lockheed Martin company), has a long-standing relationship with the Department of Defense, including the Navy, for the provision of aircraft and support services. Their track record typically involves extensive experience in manufacturing, maintaining, and upgrading various helicopter platforms used by the military. While this specific contract is for a defined period (July 2015 - June 2016), Sikorsky's broader history suggests a deep understanding of naval aviation requirements and a capacity to deliver complex support solutions. Performance on this particular contract would be evaluated based on Navy's internal assessments.

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

The primary risk associated with a sole-source contract of this magnitude ($45.4 million) is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, the government may not achieve the best possible value for its expenditure. Other risks include reduced innovation, as the contractor may have less incentive to propose cost-saving efficiencies or novel solutions. Furthermore, reliance on a single source can create vulnerabilities if that source experiences financial difficulties, operational disruptions, or fails to meet performance expectations, potentially impacting fleet readiness. The lack of transparency in the procurement process can also lead to perceptions of unfairness or inefficiency.

Are there any performance metrics or oversight mechanisms detailed for this contract?

The provided data does not detail specific performance metrics or explicit oversight mechanisms beyond the standard contractual obligations. However, as a firm-fixed-price contract, Sikorsky Support Services Inc. is obligated to deliver the specified support services within the agreed-upon price. The Department of the Navy would typically assign contracting officers' representatives (CORs) to monitor performance, ensure compliance with contract terms, and verify the quality and timeliness of services rendered. Formal performance evaluations, such as Contractor Performance Assessment Reporting System (CPARS) reports, would likely exist but are not included in this data summary.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0042115R0050

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 6900 MAIN ST, STRATFORD, CT, 06615

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

Financial Breakdown

Contract Ceiling: $48,130,053

Exercised Options: $48,130,053

Current Obligation: $45,401,141

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline