DoD awards $124.5M for aircraft parts and maintenance, with limited competition impacting price discovery

Contract Overview

Contract Amount: $124,534,620 ($124.5M)

Contractor: Dyncorp International LLC

Awarding Agency: Department of Defense

Start Date: 2024-01-31

End Date: 2026-07-31

Contract Duration: 912 days

Daily Burn Rate: $136.6K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: THIS REQUIREMENT IS TO PROVIDE SUPPLEMENTAL SUPPORT TO PERFORM THE TASKS REQUIRED FOR THE SUPPLIES, SPARES, AND REPAIR AND RETURNS PARTS FOR THE CH-47 AND MAINTENANCE SUPPORT SERVICES FOR AH-64, UH-60, 406 COMBAT SCOUTS, AND SCHWEIZER 333S AIRCRAFT

Place of Performance

Location: FORT WORTH, TARRANT County, TEXAS, 76177

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $124.5 million to DYNCORP INTERNATIONAL LLC for work described as: THIS REQUIREMENT IS TO PROVIDE SUPPLEMENTAL SUPPORT TO PERFORM THE TASKS REQUIRED FOR THE SUPPLIES, SPARES, AND REPAIR AND RETURNS PARTS FOR THE CH-47 AND MAINTENANCE SUPPORT SERVICES FOR AH-64, UH-60, 406 COMBAT SCOUTS, AND SCHWEIZER 333S AIRCRAFT Key points: 1. Contract focuses on critical sustainment for CH-47, AH-64, and UH-60 aircraft, vital for military readiness. 2. Limited competition raises concerns about potential overpayment and reduced value for taxpayer dollars. 3. Long-term contract duration (912 days) suggests a sustained need for these specialized support services. 4. The award is a definitive contract, indicating a firm commitment from the Department of the Army. 5. Analysis of pricing against similar contracts is crucial to ensure fair market value. 6. The absence of small business set-asides warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: fair

The total contract value of $124.5 million for aircraft parts and maintenance is substantial. Without specific benchmarks for similar support packages for these specific aircraft types, a precise value-for-money assessment is challenging. However, the limited competition noted in the contract details suggests a potential risk of inflated pricing. Further analysis comparing unit costs for parts and labor rates against industry standards and historical data for comparable military aircraft sustainment programs would be necessary to definitively assess value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was not competed openly, falling under a 'not available for competition' category. This significantly limits the number of potential bidders and the resulting price discovery mechanisms. While specific reasons for limited competition are not detailed, it often stems from unique capabilities, urgent needs, or existing sole-source relationships. The lack of robust competition raises concerns about whether the government secured the most advantageous pricing and terms possible.

Taxpayer Impact: Limited competition means taxpayers may not be benefiting from the most competitive pricing, potentially leading to higher overall costs for essential aircraft support services.

Public Impact

The primary beneficiaries are the U.S. Army aviation units relying on the CH-47, AH-64, and UH-60 helicopters for operational readiness. Services include the provision of supplies, spares, and repair/returns for CH-47 aircraft, alongside maintenance support for AH-64, UH-60, 406 Combat Scouts, and Schweizer 333S aircraft. The contract's geographic impact is national, supporting Army aviation assets across various operational theaters. Workforce implications include the potential for sustained employment for specialized aviation mechanics, logistics personnel, and support staff within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may result in higher costs for taxpayers.
Lack of transparency in the procurement process due to limited competition.
Potential for vendor lock-in if the contractor possesses unique, indispensable capabilities.

Positive Signals

Ensures continued operational readiness of critical Army aviation assets.
Provides specialized maintenance and parts crucial for aging aircraft fleets.
Long-term contract offers stability for sustainment operations.

Sector Analysis

This contract falls within the broader aerospace and defense sector, specifically focusing on aviation support services. The market for military aircraft sustainment is characterized by high barriers to entry due to specialized technical knowledge, certifications, and established relationships with government agencies. Spending in this area is critical for maintaining the operational readiness of aging aircraft fleets. Comparable spending benchmarks would involve analyzing other sustainment contracts for similar rotary-wing aircraft platforms within the Department of Defense.

Small Business Impact

The contract details indicate that small business participation was not a primary consideration, as the 'small business' flag is set to false. This suggests that the contract was not specifically set aside for small businesses, nor does it appear to have a significant subcontracting plan focused on them. This could limit opportunities for small businesses to participate in the defense supply chain for these critical aviation services.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. Accountability measures are typically embedded within the contract's performance work statement and delivery schedules. Transparency is somewhat limited due to the non-competitive nature of the award. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract's execution.

Related Government Programs

Aircraft Parts and Maintenance Services
Rotary-Wing Aircraft Support
Defense Logistics and Sustainment
Aviation Maintenance Contracts
CH-47 Chinook Support
AH-64 Apache Support

Risk Flags

Limited Competition
Potential for Cost Overruns
Lack of Small Business Focus

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $124.5 million to DYNCORP INTERNATIONAL LLC. THIS REQUIREMENT IS TO PROVIDE SUPPLEMENTAL SUPPORT TO PERFORM THE TASKS REQUIRED FOR THE SUPPLIES, SPARES, AND REPAIR AND RETURNS PARTS FOR THE CH-47 AND MAINTENANCE SUPPORT SERVICES FOR AH-64, UH-60, 406 COMBAT SCOUTS, AND SCHWEIZER 333S AIRCRAFT

Who is the contractor on this award?

The obligated recipient is DYNCORP INTERNATIONAL LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $124.5 million.

What is the period of performance?

Start: 2024-01-31. End: 2026-07-31.

What is DynCorp International LLC's track record with similar Department of Defense aviation support contracts?

DynCorp International LLC has a long history of providing aviation support services to the U.S. military, including maintenance, logistics, and training. They have held numerous contracts for various aircraft platforms across different branches of the armed forces. Their experience often involves complex, global operations requiring specialized technical skills and robust supply chain management. While specific performance metrics for past contracts are not detailed here, their continued awards suggest a generally satisfactory performance history. However, a deeper dive into past contract performance evaluations (e.g., CPARS reports) would provide a more comprehensive understanding of their reliability and effectiveness in delivering similar services.

How does the $124.5 million contract value compare to historical spending on CH-47 and AH-64 sustainment?

Comparing the $124.5 million contract value requires access to historical spending data for CH-47 and AH-64 sustainment programs. This specific contract covers a period of approximately 2.5 years (912 days). To benchmark, one would need to analyze annual or multi-year spending trends for similar support services for these aircraft types. For instance, if previous annual sustainment costs for a comparable number of aircraft were significantly lower, this contract's value might appear high. Conversely, if market prices for parts and labor have increased, or if the scope of services is broader than previous contracts, the current value could be justified. Without detailed historical data and a clear understanding of the specific services included, a direct comparison is difficult.

What are the primary risks associated with the limited competition for this contract?

The primary risks associated with limited competition for this contract include: 1. **Higher Costs:** Without robust competition, the contractor may not be incentivized to offer the lowest possible price, potentially leading to overpayment by the government. 2. **Reduced Innovation:** Limited bidders may stifle innovation in service delivery or technology adoption, as there is less pressure to differentiate based on unique offerings. 3. **Potential for Suboptimal Performance:** While not guaranteed, a lack of competitive pressure could theoretically lead to complacency in performance quality or responsiveness. 4. **Limited Vendor Options:** If this contract is critical and awarded non-competitively, it could create a dependency on a single provider, limiting future flexibility. 5. **Difficulty in Benchmarking:** It becomes harder to establish fair market price benchmarks when only one or a few entities are considered.

How effective is the Department of the Army in ensuring value for money on non-competitive aviation support contracts?

The effectiveness of the Department of the Army in ensuring value for money on non-competitive contracts varies and depends heavily on the specific procurement processes and oversight mechanisms employed. For 'not available for competition' awards, agencies are typically required to conduct thorough market research and price analyses (e.g., using historical pricing, commercial price lists, or independent government cost estimates) to justify the negotiated price. The presence of robust internal review processes, experienced contracting officers, and potentially the involvement of cost-price analysts are crucial. However, the inherent lack of competitive pressure means that vigilance and rigorous negotiation are paramount. Without direct comparison to other bids, the risk of paying more than necessary always exists, making strong internal controls and justification requirements essential.

What is the historical spending trend for 'Other Support Activities for Air Transportation' (NAICS 488190) by the Department of the Army?

Analyzing the historical spending trend for NAICS code 488190 ('Other Support Activities for Air Transportation') by the Department of the Army requires access to comprehensive federal procurement data. Generally, spending in this category can fluctuate based on operational tempo, aircraft modernization programs, and the sustainment needs of aging fleets. The Army, operating a large and diverse aviation inventory, would likely show consistent, significant spending in this area. Trends might indicate an increase in sustainment spending as aircraft age and require more maintenance, or shifts in spending patterns as new platforms are introduced or older ones retired. A detailed analysis would involve examining annual obligations over several fiscal years to identify patterns, peaks, and troughs in spending within this specific service category.

What are the implications of the contract being a 'FIRM FIXED PRICE' type for this type of service?

A 'FIRM FIXED PRICE' (FFP) contract type means the price is set and not subject to adjustment based on the contractor's cost experience in performing the work. For aviation support services like parts and maintenance, an FFP contract places the risk of cost overruns squarely on the contractor. This can be advantageous for the government as it provides cost certainty. However, it also means the contractor must accurately estimate all costs upfront. If the contractor underestimates costs, they may cut corners on quality or service to maintain profitability, which could be a concern. Conversely, if the contractor accurately anticipates costs and manages them efficiently, the government benefits from predictable pricing. The effectiveness of an FFP contract here depends on the contractor's ability to accurately scope and price the complex requirements of aircraft sustainment.

Industry Classification

NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation

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

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: PAE Government Services Inc.

Address: 13500 HERITAGE PKWY, FORT WORTH, TX, 76177

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $159,193,718

Exercised Options: $124,534,620

Current Obligation: $124,534,620

Subaward Activity

Number of Subawards: 6

Total Subaward Amount: $346,682

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline