Analysis of Benefits Realized from Multiyear Contracting for the Black Hawk Helicopter.

Abstract

In 1982, the Congress authorized a $950 million 3-year multiyear contract for 294 Black Hawk helicopters. The Army estimated that such an arrangement would save about $8.1 million, or 7.9 percent, compared with three successive annual contracts for the same number of helicopters. GAO's analysis indicated an estimated budgetary savings to the Army of $73.9 million, with a net discounted savings to the government of about $36.6 million, or about 4.6 percent. GAO's estimate of net savings takes into account the cost of providing funds earlier under the multiyear contract. In addition, revenue to the U.S. Treasury may be reduced because of the tax implications of a multiyear contract. Neither the Army nor the contractor had evidence that the Black Hawk multiyear contract significantly enhanced the defense industrial base, another anticipated benefit of multiyear contracting.

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Document Details

Document Type
Technical Report
Publication Date
May 09, 1984
Accession Number
ADA141424

Entities

Organizations

  • United States Government Accountability Office

Tags

Communities of Interest

  • Air Platforms
  • Weapons Technologies

DTIC Thesaurus Topics

  • Aircrafts
  • Congress
  • Contractors
  • Contracts
  • Cost Reductions
  • Costs
  • Department Of Defense
  • Economic Models
  • Governments
  • Helicopters
  • House Of Representatives
  • Ice
  • Money
  • National Governments
  • National Security
  • Procurement
  • Weapon Systems

Readers

  • Aviation Science / Aeronautics.
  • Government Contracting/Procurement.