DoD's $995M Test Support Contract to TRAX International: A Decade of Engineering Services in Arizona

Contract Overview

Contract Amount: $994,883,988 ($994.9M)

Contractor: Trax International Corporation

Awarding Agency: Department of Defense

Start Date: 2008-12-02

End Date: 2018-05-31

Contract Duration: 3,467 days

Daily Burn Rate: $287.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: BASE PERIOD - USAYPG TEST SUPPORT SERVICES

Place of Performance

Location: YUMA, YUMA County, ARIZONA, 85365

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $994.9 million to TRAX INTERNATIONAL CORPORATION for work described as: BASE PERIOD - USAYPG TEST SUPPORT SERVICES Key points: 1. The contract represents a significant investment in specialized engineering services for defense testing. 2. TRAX International has held this contract for a substantial period, indicating a long-term relationship. 3. The award was made under full and open competition, suggesting a robust bidding process. 4. The contract type, Cost Plus Award Fee, incentivizes performance but requires careful oversight. 5. The geographic concentration in Arizona highlights a specific regional impact for this federal spending. 6. The duration of the contract (over 9 years) suggests a stable, ongoing need for these services.

Value Assessment

Rating: good

The total value of $994.9 million over nearly a decade for test support services is substantial. Benchmarking this against similar large-scale engineering support contracts for defense operations is complex due to the specialized nature of test support. However, the Cost Plus Award Fee structure implies that the final cost is tied to performance, which can be a good indicator of value if managed effectively. Without specific performance metrics and award fee payouts, a definitive value-for-money assessment is challenging, but the sustained award suggests perceived value by the Department of the Army.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The presence of 3 bidders suggests a competitive landscape for this type of specialized defense support. A competitive process generally leads to better price discovery and potentially more favorable terms for the government compared to sole-source or limited competition scenarios.

Taxpayer Impact: Taxpayers benefit from the competitive bidding process, which aims to secure the best possible price and service quality for the government's investment in essential defense testing infrastructure.

Public Impact

The primary beneficiaries are the Department of the Army and other Department of Defense entities requiring sophisticated test and evaluation support. Services delivered include a wide range of engineering, technical, and operational support for weapons systems testing. The contract has a significant geographic impact, primarily concentrated in Arizona, where key testing facilities are located. This contract supports a specialized workforce of engineers, technicians, and support personnel, contributing to the high-skill job market in Arizona.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The Cost Plus Award Fee structure requires diligent oversight to ensure award fees are justified by exceptional performance and not merely routine execution.
Long-term contracts can sometimes lead to complacency or reduced competitive pressure if not actively managed and re-competed effectively.
The significant dollar value necessitates robust financial controls and auditing to prevent cost overruns or improper billing.

Positive Signals

Awarded under full and open competition, indicating a healthy market and competitive pricing.
The Cost Plus Award Fee structure provides an incentive for TRAX International to exceed performance expectations.
The sustained award over a long period suggests consistent delivery of required services and satisfaction with the contractor's performance.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting defense research, development, testing, and evaluation (RDT&E). The market for defense test and evaluation support is specialized, often dominated by a few large contractors capable of meeting the stringent requirements of military clients. Comparable spending benchmarks are difficult to establish precisely due to the unique nature of test support, but large-scale engineering services contracts for the DoD often run into hundreds of millions or billions of dollars over their lifecycle.

Small Business Impact

The data indicates that small business participation was not a primary focus, as the contract was not set aside for small businesses (ss: false) and TRAX International is a large corporation. There is no explicit information on subcontracting plans for small businesses within this data. The lack of a small business set-aside suggests that the primary competition was among large, established firms, potentially limiting direct opportunities for smaller specialized companies in this specific award, though they might participate indirectly through subcontracts.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Army contracting and program management offices. The Cost Plus Award Fee structure necessitates performance monitoring and evaluation to justify award fee payments. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Army Test and Evaluation Command (ATEC) Services
DoD Weapons Systems Testing
Engineering and Technical Support Services
Defense Contract Management Agency (DCMA) Oversight

Risk Flags

Long-term contract duration may reduce competitive pressure.
CPAF structure requires diligent performance monitoring to ensure value.
Potential for cost overruns in cost-reimbursement elements.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $994.9 million to TRAX INTERNATIONAL CORPORATION. BASE PERIOD - USAYPG TEST SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is TRAX INTERNATIONAL CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $994.9 million.

What is the period of performance?

Start: 2008-12-02. End: 2018-05-31.

What is TRAX International's track record with this specific contract and similar DoD contracts?

TRAX International has been the incumbent contractor for USAYPG Test Support Services since December 2008, indicating a long-standing relationship and consistent performance over multiple contract periods. Their track record with this specific contract suggests a deep understanding of the requirements and a proven ability to deliver. While detailed performance reviews are not publicly available in this dataset, the repeated awards and extensions imply a satisfactory performance history. For similar DoD contracts, TRAX International typically provides test operations, engineering, and technical support services, often at large government test ranges and facilities. Their experience spans various aspects of military testing, from vehicle and weapons systems to soldier systems.

How does the $995 million total contract value compare to similar test support services contracts awarded by the DoD?

The $995 million total contract value for nearly 10 years of test support services is substantial and aligns with the scale of major engineering and operational support contracts within the Department of Defense. Large-scale test ranges and complex weapons system development programs often require multi-year support contracts in the hundreds of millions, sometimes exceeding a billion dollars. For instance, contracts for supporting major proving grounds like Dugway Proving Ground or Redstone Arsenal can reach similar magnitudes. The value reflects the extensive scope of services, including personnel, equipment, facilities management, and specialized technical expertise required for comprehensive military testing and evaluation over an extended period.

What are the primary risks associated with a Cost Plus Award Fee (CPAF) contract of this magnitude?

The primary risks with a CPAF contract of this magnitude ($995 million) revolve around ensuring that the award fees are genuinely earned through exceptional performance and not simply awarded for meeting basic requirements. There's a risk of cost growth if the base cost-plus portion is not well-defined or if unforeseen issues arise. Effective oversight is critical to scrutinize performance metrics and justify each award fee payment. Another risk is the potential for contractor focus to shift towards maximizing award fees rather than addressing the most critical program needs if the incentive structure is not perfectly aligned. For the government, the risk lies in potentially overpaying if performance evaluations are not rigorous or if the definition of 'exceptional performance' is too broad.

How effective has this contract been in supporting the Army's testing and evaluation mission?

The effectiveness of this contract in supporting the Army's testing and evaluation mission is suggested by its longevity and the fact that it was awarded under full and open competition multiple times. The Department of the Army has continued to award and extend this contract with TRAX International for over a decade, implying that the services provided have met the Army's needs for test support at the Yuma Proving Ground (USAYPG). While specific metrics on mission success are not provided, the sustained requirement for these services indicates their critical role in the Army's RDT&E processes, enabling the evaluation of new equipment and technologies before fielding.

What are the historical spending patterns for test support services at USAYPG or similar Army facilities?

Historical spending patterns for test support services at facilities like the Yuma Proving Ground (USAYPG) typically show significant, long-term investments. Contracts for such comprehensive support often span many years and involve substantial funding, frequently in the hundreds of millions of dollars, as seen with this $995 million award over approximately 9.5 years. Spending is usually driven by the Army's modernization priorities and the need to test a pipeline of new equipment. These contracts often involve base periods with options for extensions, allowing for continuity while adapting to evolving requirements. The consistent award to a single entity like TRAX International suggests a stable, ongoing need and a recognized capability for providing these specialized services.

What is the significance of the contract being awarded in Arizona?

The significance of this contract being awarded and performed in Arizona is primarily economic and operational. Arizona, particularly the Yuma Proving Ground (USAYPG), is a critical hub for military testing due to its favorable climate and vast land areas. The contract's presence means substantial federal spending flows into the state, supporting local economies through jobs, services, and infrastructure. It sustains a specialized workforce in engineering and technical fields within Arizona. Operationally, it ensures that vital testing capabilities remain accessible and well-supported, contributing directly to the readiness and technological advancement of the U.S. Army.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W9124R08R0021

Offers Received: 3

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 3120 E POST RD, LAS VEGAS, NV, 89120

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Subchapter S Corporation

Financial Breakdown

Contract Ceiling: $1,036,684,363

Exercised Options: $1,036,684,363

Current Obligation: $994,883,988

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline