Design and Engineering Support Program III (DESP III)

The Defense Finance and Accounting Service awarded Design and Engineering Support Program III (DESP III), a multiple-award Master IDIQ, on January 10, 2012, with a shared ceiling of $1.9 billion and ordering closed on January 29, 2019. This vehicle is no longer active—no orders have been placed for over seven years.

DESP III succeeded Design and Engineering Support Program II and functioned as a broad Air Force and DoD engineering services vehicle spanning system and subsystem design, prototype development, limited production runs, technical data package work, sustainment engineering, and advisory and assistance services. The vehicle excluded repair work but permitted incidental construction essential to engineering performance.

Of the $1.9 billion ceiling, task orders obligated $559.6 million against a combined potential value of $587.4 million, representing 95 percent utilization of awarded work. Ordering activity peaked in 2014 at 38 orders before declining sharply: 26 orders in 2015, 28 in 2016, and only 7 orders placed in 2017, the vehicle's final year. Across its five-year life, 163 task orders were issued by 30 prime contractors serving 24 distinct customer agencies.

Competition concentrated heavily among three firms: Kihomac Inc. held 20 orders valued at $161.6 million; Aerospace Engineering Spectrum LTD held 22 orders at $78.8 million; and Hebco, Inc. held 24 orders at $78.2 million. These three primes captured roughly 55 percent of order count and 69 percent of combined potential value. Northrop Grumman technical services and Gauss Management Research And Engineering accounted for the remainder of high-activity primes.

Air Force Materiel Command drove 82 percent of the workload. The Air Force Sustainment Center placed 56 orders valued at $194.9 million; general AMC placed 39 orders at $105.2 million; and the Ogden and Oklahoma City Air Logistics Complexes contributed 24 and 8 orders respectively.

About 78 percent of orders were unrestricted; the remaining 22 percent were set aside for small business, predominantly as sole-source 8(a) awards. Representative task orders show cost-plus-fixed-fee and firm-fixed-price work ranging from roughly $150,000 to $25 million in individual order value, with several mega-orders exceeding $25 million—notably ALQ-161 Band 8 Redesign at $29.5 million, OC-135B DVIS upgrade at $43.8 million potential value, and Hill Enterprise Data Center modernization at $36.8 million.

DESP III is a five-year multiple award Master IDIQ contract vehicle providing a broad range of engineering services in support of any system or subsystem within the Air Force and other DoD agencies. The contract ceiling amount is set at $1.9 billion. One of the primary purposes of DESP III is to provide the Air Force and other DoD customers with a contract vehicle for engineering services in a fraction of the time normally required for standard contract actions. Although DESP III excludes repair work, it includes the development of prototypes and limited production runs, and can be used for advisory and assistance services. In addition, incidental construction essential to the performance of the engineering service is allowed.