Lockheed Awarded 7th Option Year to Manage US Military’s Retired and Annuitant Pay Service

Lockheed Martin Government Services, Inc. in Seabrook, MD received a 7th year option of $27.1 million as part of contract MDA220-01-D-0002 for management of the Retired and Annuitant pay service. The service was formerly managed by the Defense Finance and Accounting Service (DFAS), but was the subject of an “A-76 action.” The core concept of the American “A-76″ option is that it puts in-house services up for bid against private contractors, and may outsource the function if outside contractors can deliver better and cheaper. This sort of thing can be rather disconcerting to our readers in government departments, while many our readers working in large corporations probably wish they had this option with some of their internal departments. DID covered option #6 last year, along with a very provocative and interesting follow-on question from a reader re: A-76 competitions.

The estimated aggregate face value of this contract at time of award was $346.4 million. Primary work is performed at DFAS Cleveland, OH and secondary work which includes document scanning and primarily imaging is performed at London, KY. Under this option, work will be performed between Feb 1/08, through Jan 31/09. The DFAS Contract Services Directorate in Columbus, OH issued the contract (MDA220-01-D-0002).