Pentagon awards biggest small-business contract ever

The Defense Department announced late last week that it has awarded the largest combined small business set-aside acquisition in the federal government's history. A group of three small and disadvantaged businesses signed contracts to provide global satellite transmission services for the Defense Information System Network (DISN). The Pentagon estimates the combined value of the contracts will total $2.2 billion. "This piece of satellite communications will help complete a very critical segment of the Global Information Grid by completing and enhancing existing DISN satellite, wireless, teleport and terrestrial network capabilities," said Air Force Lt. Gen. Harry D. Raduege Jr., director of the Defense Information Systems Agency (DISA). Defense has come under increasing criticism in recent years for contract bundling, a practice that entails rolling numerous contracts into a single solicitation. For example, the Air Force is combining virtually all maintenance work for weapons systems into six prime contracts worth an estimated total of $7.4 billion over seven years. Defense procurement officials say bundled contracts are less expensive to manage, but some small business owners have complained they prevent them from competing with large firms for multi-billion dollar deals. To quell some of that criticism, Air Force officials have said that two of the six contracts will be awarded to small businesses or joint ventures in which a group of small businesses bids as a unit. Asked whether last week's contract award was a response to the concerns of small business owners, a DISA spokesperson said the agency "has had a long-term desire to meet the efforts of the small business goals. [This] award emphasizes our commitment in support of" those goals. The three firms that won the DISN contract-Artel Inc. of Reston, Va., Spacelink International LLC of Dulles, Va., and Arrowhead Space and Telecommunications Inc. of Falls Church, Va.-were awarded indefinite delivery/indefinite quality contracts, each for a base period of three years with seven one-year options. No funds will be immediately obligated under the contracts.
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