United States Government Publishing Office publisher pbl distributor dst United States Government Accountability Office National Security and International Affairs Division author aut Government Organization text government publication eng GAOREPORTS Legislative Agency Publications gao legislative 2010-08-12 U.S. Government Printing Office 1996-09-24 monographic deposited born digital 29 p. GA 1.13:NSIAD-96-232 https://www.govinfo.gov/app/details/GAOREPORTS-NSIAD-96-232 P0b002ee180382aa6 f:ns96232 DGPO 2010-08-12 2011-03-24 GAOREPORTS-NSIAD-96-232 machine generated eng fdlp REPORT GAOREPORTS-NSIAD-96-232 NSIAD-96-232 Contract administration Prime contractors Manufacturing contracts Department of Defense contractors Subcontracts Contract costs Contract negotiations Foreign governments Procurement regulation Air Force procurement F-16 Aircraft Mid-Life Update Program F-16 Aircraft Belgium Denmark Netherlands Norway F-16 Multinational Fighter Program Letter Report NSIAD

GAO reviewed the pricing of selected contracts and subcontracts awarded under the F-16 Aircraft Mid-Life Update (MLU) Program.<p/>GAO found that: (1) the prime contractors proposed and the Air Force accepted different rates and factors for pricing MLU contracts; (2) because of the different rates and factors, the European governments' contract prices were $9.4 million higher; (3) the forward pricing rate agreement (FPRA) used in the Lockheed Martin MLU contract was the same FPRA used to price other Lockheed contracts; (4) the Air Force negotiated two other contracts with Lockheed on the same day as the MLU negotiation, using lower FPRA rates; (5) the Air Force used a general and administrative overhead rate for foreign military sales in the Northrop Grumman contract, rather than a lower domestic rate, thus increasing the European participants' costs by $1.4 million; (6) Air Force negotiators conducted the preaward audits of the prime contractors' price proposals to assist them in negotiating lower prices for the prime contracts; (7) there are indications that the prime contractors overpriced material items by as much as $947,000; and (8) Lockheed awarded the Hazeltine subcontract competitively and the Honeywell subcontract noncompetitively, using rates and factors recommended by the U.S. government contract administration activity, and employing safeguard techniques required by U.S. procurement regulations. https://www.govinfo.gov/content/pkg/GAOREPORTS-NSIAD-96-232/html/GAOREPORTS-NSIAD-96-232.htm https://www.govinfo.gov/content/pkg/GAOREPORTS-NSIAD-96-232/pdf/GAOREPORTS-NSIAD-96-232.pdf GAO/NSIAD-96-232 https://www.govinfo.gov/app/details/GAOREPORTS-NSIAD-96-232 Letter Report GAO/NSIAD-96-232; Contract Pricing: Pricing of F-16 Mid-Life Update Program Contracts; Contract administration Prime contractors Manufacturing contracts Department of Defense contractors Subcontracts Contract costs Contract negotiations Foreign governments Procurement regulation Air Force procurement F-16 Aircraft Mid-Life Update Program F-16 Aircraft Belgium Denmark Netherlands Norway F-16 Multinational Fighter Program Title 10 Section 2306a 10 U.S.C. 2306a Title 18 Section 1905 18 U.S.C. 1905