Air Force reopens $972M Northrop contract after conflict-of-interest allegations

The Air Force is rethinking a $972 million modeling-and-simulation contract that went to Northrop Grumman after challengers raised objections to the award, including allegations of an organizational conflict-of-interest.

HII and Science Applications International Corp. have raised several issues about how the Air Force evaluated proposals for the five-year contract.

SAIC is the incumbent contractor and alleged Northrop had an impaired objectivity organizational conflict of interest, which means that Northrop is accused of being in a position to judge its own work.

SAIC said that nothing was done to mitigate the conflict, the Air Force failed to consider the impacts of a Northrop divestiture would have on its ability to perform and that the service branch failed to evaluate Northrop’s employee compensation plan.

HII also raised the issue of the divestiture, but also challenged how proposals and pricing were evaluated. HII also argued that the Air Force conducted an improper best-value determination.

The business unit in question is the former Northrop Grumman Mission Training and Satellite business, which Serco Inc. acquired in May for $327 million. Synthetic training and exercise simulation is a capability of that business.

Serco Inc. is inheriting a 10-year, $800 million contract to support the Air Force’s Distributed Mission Operations Network, which connects simulator platforms across 100 Air Force sites.

The protests were filed in September, but work on them was delayed because of the government.

GAO dismissed the protests on Tuesday after the Air Force said it would take corrective action and make a new award decision after conducting an OCI investigation.