DoD's $191M logistics contract with BAE Systems awarded via full and open competition

Contract Overview

Contract Amount: $191,287,135 ($191.3M)

Contractor: BAE Systems Technology Solutions & Services Inc.

Awarding Agency: Department of Defense

Start Date: 2008-07-28

End Date: 2018-09-30

Contract Duration: 3,716 days

Daily Burn Rate: $51.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: COST PLUS AWARD FEE

Sector: Other

Official Description: LOGISTICS SUPPORT AND SERVICES

Place of Performance

Location: SCHOFIELD BARRACKS, HONOLULU County, HAWAII, 96857

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $191.3 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. for work described as: LOGISTICS SUPPORT AND SERVICES Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Award Fee, which incentivizes performance but can lead to cost overruns if not managed carefully. 3. With a duration of 3716 days, this represents a long-term commitment for logistics support. 4. The contract was awarded to BAE Systems Technology Solutions & Services Inc., a major defense contractor. 5. The primary service falls under Facilities Support Services. 6. The contract was awarded in 2008 and completed in 2018, indicating a historical spending pattern.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics and detailed cost breakdowns. The Cost Plus Award Fee structure means the final cost is tied to performance, making direct price comparisons difficult. However, the significant dollar amount over a decade suggests substantial services were rendered. Further analysis would require comparing the scope of services and the award fees paid against similar long-term logistics support contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit a bid. The presence of 7 bidders suggests a reasonably competitive environment at the time of award. This level of competition is generally favorable for price discovery and potentially achieving better value for the government.

Taxpayer Impact: A competitive award process helps ensure taxpayer dollars are used efficiently by driving down prices and encouraging innovative solutions from multiple vendors.

Public Impact

The Department of the Army benefits from comprehensive logistics support services. Services likely include a wide range of facilities management and operational support. The contract's duration suggests sustained support for military operations or installations. Geographic impact is likely concentrated in Hawaii, where the contract was performed. The contract supported a significant workforce, both directly employed by BAE Systems and potentially through subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts can sometimes lead to higher final costs than fixed-price contracts if award criteria are not tightly managed.
Long-term contracts of this duration require continuous oversight to ensure ongoing value and prevent scope creep.
Reliance on a single large contractor for extensive logistics support could pose risks if the contractor faces financial or operational difficulties.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
The Cost Plus Award Fee structure incentivizes contractor performance.
The contract was awarded to a well-established defense contractor with a track record in similar services.

Sector Analysis

This contract falls within the Facilities Support Services sector, a critical component of the broader professional, scientific, and technical services industry. This sector encompasses a wide array of services essential for the operation and maintenance of government facilities. Spending in this area is often substantial, particularly within the Department of Defense, to ensure readiness and operational efficiency. Comparable spending benchmarks would involve analyzing other large-scale, long-term facilities support contracts awarded by federal agencies.

Small Business Impact

While this contract was awarded to a large prime contractor, BAE Systems, there is no explicit indication of a small business set-aside. Large, long-term contracts like this often involve significant subcontracting opportunities. The extent to which BAE Systems utilized small businesses for subcontracting would determine the actual impact on the small business ecosystem. Without specific subcontracting data, it's difficult to assess the direct benefit to small businesses.

Oversight & Accountability

Oversight for this contract would have been managed by the contracting agency, the Department of the Army. The Cost Plus Award Fee structure necessitates performance monitoring to determine award fee payments. Transparency is typically managed through contract reporting mechanisms. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.

Related Government Programs

Logistics Support Services
Facilities Management Contracts
Department of Defense Contracts
Cost Plus Award Fee Contracts
Long-Term Government Contracts

Risk Flags

Cost Plus Award Fee contract type requires careful monitoring to manage costs.
Long contract duration necessitates sustained oversight to ensure value.
Potential for cost overruns if performance incentives are not well-defined or managed.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $191.3 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC.. LOGISTICS SUPPORT AND SERVICES

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $191.3 million.

What is the period of performance?

Start: 2008-07-28. End: 2018-09-30.

What was the specific scope of 'Logistics Support and Services' provided under this contract?

The provided data indicates the contract falls under NAICS code 561210 (Facilities Support Services). While the specific 'Logistics Support and Services' are not detailed, this category typically encompasses a broad range of activities necessary for the operation and maintenance of facilities. This could include services such as base operations support, maintenance and repair of facilities and equipment, transportation services, supply chain management, waste management, and potentially security services. The 'Cost Plus Award Fee' structure suggests that the contractor was incentivized to meet specific performance objectives related to these services, with bonuses awarded for exceeding expectations.

How did the final awarded cost compare to the initial estimated cost, considering the Cost Plus Award Fee structure?

The provided data only shows the total awarded amount ($191,287,134.86), not a breakdown of initial estimates versus final costs. For a Cost Plus Award Fee (CPAFF) contract, the government pays the contractor's allowable costs plus a negotiated fee. This fee often has a base amount and an award amount, contingent on meeting or exceeding performance targets. Therefore, the final cost can fluctuate based on actual costs incurred and the level of performance achieved. Without access to the contract's cost performance reports or final audit, it's impossible to determine how the final cost compared to initial estimates or the target fee.

What were the key performance metrics used to determine the award fee for BAE Systems?

The specific performance metrics for determining the award fee are not detailed in the provided summary data. However, for a Facilities Support Services contract of this nature, typical performance metrics could include factors like response times for maintenance requests, facility uptime, energy efficiency, safety compliance, customer satisfaction surveys (e.g., from base personnel), and adherence to environmental regulations. The 'Award Fee' component is designed to incentivize the contractor to go beyond minimum requirements. The contracting officer would have evaluated performance against pre-defined criteria to determine the amount of the award fee paid.

What was the historical spending trend for similar logistics support contracts by the Department of the Army in Hawaii?

The provided data focuses on a single contract awarded to BAE Systems for logistics support in Hawaii. To understand historical spending trends for similar contracts, one would need to analyze a broader dataset of Department of the Army contracts within the same geographic region (Hawaii) and for similar service categories (e.g., facilities support, base operations, logistics management) over a period preceding and following this contract's award and completion. This would involve querying federal procurement databases (like FPDS or USASpending) for relevant NAICS codes and keywords. Without this broader analysis, it's impossible to establish a trend based solely on this one contract.

Were there any significant contract modifications or disputes during the contract's lifecycle?

The provided data does not include information on contract modifications, change orders, or disputes. Large, long-term contracts, especially those with a Cost Plus Award Fee structure, often undergo modifications to adjust scope, funding, or timelines. Disputes can arise over cost allowability, performance, or interpretation of contract terms. A thorough review of the contract's official file, including modification history and any associated documentation (e.g., contract disputes board records), would be necessary to identify any significant issues that arose during its 10-year period.

How does the per-unit cost, if calculable, compare to industry benchmarks for facilities support services?

Calculating a meaningful 'per-unit cost' for a broad contract encompassing 'Logistics Support and Services' and 'Facilities Support Services' is highly complex without detailed breakdowns of the services rendered and their respective quantities. The contract's total value ($191M over ~10 years) divided by the duration gives an average annual spend of roughly $19M. However, this figure doesn't represent a 'per-unit' cost. To compare with industry benchmarks, one would need to identify specific, quantifiable services (e.g., cost per square foot maintained, cost per maintenance task completed, cost per ton of supplies managed) and compare those against industry data for similar facilities and operational environments. Such granular data is not available in the summary.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 7

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC (UEI: 217304393)

Address: 1601 RESEARCH BLVD, ROCKVILLE, MD, 20850

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $194,685,106

Exercised Options: $194,685,106

Current Obligation: $191,287,135

Actual Outlays: $48,136

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline