DoD awards $50M for SINCGARS radio systems to L3Harris, raising questions about competition and value

Contract Overview

Contract Amount: $49,996,373 ($50.0M)

Contractor: L3harris Global Communications, Inc.

Awarding Agency: Department of Defense

Start Date: 2010-03-04

End Date: 2020-07-23

Contract Duration: 3,794 days

Daily Burn Rate: $13.2K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ITT SINCGARS DUAL VE

Place of Performance

Location: ROCHESTER, MONROE County, NEW YORK, 14623

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $50.0 million to L3HARRIS GLOBAL COMMUNICATIONS, INC. for work described as: ITT SINCGARS DUAL VE Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery and potentially increasing costs. 2. Long contract duration (over 10 years) suggests a need for sustained support, but also risks obsolescence. 3. Firm Fixed Price contract type offers cost certainty but may not incentivize contractor efficiency. 4. Awarded to a single vendor, indicating potential market concentration or specific technical requirements. 5. Significant spending on radio equipment highlights ongoing needs in military communications infrastructure. 6. Lack of small business participation noted, suggesting limited opportunities for smaller firms in this procurement.

Value Assessment

Rating: questionable

The contract's value is difficult to benchmark due to its non-competitive nature and long duration. While the total award is $49,996,373, the lack of competing bids prevents a direct comparison to market rates or alternative solutions. The firm-fixed-price structure provides cost predictability for the government, but without competitive pressure, it's unclear if this represents the best possible value for the taxpayer. Further analysis would be needed to assess if the pricing aligns with industry standards for similar advanced communication systems.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a sole-source justification, meaning it was not competed openly. The data indicates 'NOT AVAILABLE FOR COMPETITION,' suggesting that only one vendor, L3Harris Global Communications, Inc., was considered capable of fulfilling the requirement. This lack of competition limits the government's ability to explore alternative solutions or leverage market dynamics to secure the most favorable pricing. The rationale for this sole-source award would need to be thoroughly reviewed to ensure it was justified.

Taxpayer Impact: Sole-source awards can lead to higher prices for taxpayers as there is no competitive pressure to drive down costs. This limits the government's purchasing power and potentially diverts funds that could be used for other critical needs.

Public Impact

The Department of the Army benefits from the acquisition of critical SINCGARS (Single Channel Ground and Airborne Radio System) dual vehicle radios. These radios are essential for maintaining secure and reliable battlefield communications for ground troops and airborne units. The contract supports the operational readiness and effectiveness of military personnel involved in various defense operations. The geographic impact is primarily within military installations and operational theaters where these communication systems are deployed. Workforce implications may include specialized technical support and maintenance roles associated with the radio systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Non-competitive award limits price discovery and potentially leads to higher costs for taxpayers.
Long contract duration (over 10 years) increases the risk of technology obsolescence and maintenance challenges.
Lack of transparency in the sole-source justification could mask underlying issues with market research or planning.
Firm Fixed Price contract, while offering cost certainty, may not incentivize the contractor to seek cost efficiencies.
No indication of small business participation suggests a missed opportunity to foster growth in that sector.

Positive Signals

Award ensures continued access to critical communication systems for the Department of Defense.
Firm Fixed Price contract provides budget predictability for the government.
L3Harris Global Communications, Inc. is a known entity in defense contracting, suggesting a degree of reliability.
The contract addresses a specific and essential military requirement for battlefield communications.

Sector Analysis

The procurement falls within the broader defense electronics and communications sector. This sector is characterized by high technological complexity, significant R&D investment, and long product lifecycles. The SINCGARS system is a mature but vital component of military tactical communications. Comparable spending in this area often involves substantial investments in radio, satellite, and network-centric warfare technologies, with major defense contractors dominating the market. The market size for such specialized military hardware is substantial, driven by global defense spending.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the sole-source nature of the award limits opportunities for small businesses to participate as prime contractors or even subcontractors unless specifically included by the prime. This suggests that the primary contract vehicle did not prioritize small business engagement, potentially impacting the broader small business defense industrial base ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and program management offices. Accountability measures are typically embedded within the contract terms, including performance metrics and delivery schedules. Transparency is limited due to the sole-source nature of the award, making public scrutiny of the justification and pricing more challenging. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Tactical Radio Systems
Military Communications Equipment
Department of Defense Procurement
SINCGARS Program
Wireless Communications Manufacturing

Risk Flags

Sole-source award raises concerns about competition and potential overpricing.
Long contract duration increases the risk of technology obsolescence.
Lack of small business participation noted.
Limited public information on specific performance metrics and justification.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $50.0 million to L3HARRIS GLOBAL COMMUNICATIONS, INC.. ITT SINCGARS DUAL VE

Who is the contractor on this award?

The obligated recipient is L3HARRIS GLOBAL COMMUNICATIONS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $50.0 million.

What is the period of performance?

Start: 2010-03-04. End: 2020-07-23.

What is the specific justification for awarding this contract on a sole-source basis to L3Harris Global Communications, Inc.?

The provided data indicates the contract was 'NOT AVAILABLE FOR COMPETITION,' which is a strong indicator of a sole-source award. Typically, sole-source justifications are based on factors such as unique technical capabilities, proprietary technology, urgent and compelling needs where only one source can reasonably fulfill the requirement, or specific government-mandated sources. For this particular contract, the specific justification would likely stem from the specialized nature of the SINCGARS system and L3Harris's established role as a provider or integrator of this technology. Without access to the official justification document (e.g., a Justification and Approval or J&A), the precise reasons remain speculative but would focus on the lack of viable alternatives or the unique qualifications of the incumbent.

How does the $49.9 million award compare to historical spending on similar SINCGARS radio systems?

Comparing this $49.9 million award to historical spending requires access to detailed historical contract data for SINCGARS systems across different agencies and time periods. However, given the contract's duration (over 10 years) and the nature of military hardware procurement, this figure represents a significant, albeit potentially averaged, investment. If this represents the total value over the contract's life, it suggests a substantial commitment to maintaining and potentially upgrading these communication capabilities. Historical data might reveal if this award is consistent with previous procurement cycles, higher due to inflation or technological advancements, or lower due to market shifts or reduced requirements. Without specific historical benchmarks, it's challenging to definitively state if it's higher or lower, but the amount signifies a considerable expenditure on this specific communication technology.

What are the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract?

The provided data does not explicitly list the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. However, for a contract involving the supply of radio and wireless communications equipment, typical KPIs would likely include delivery timelines, product reliability (e.g., Mean Time Between Failures - MTBF), system uptime, performance under various environmental conditions (temperature, humidity, shock), and potentially response times for technical support or repair. SLAs might cover warranty provisions, maintenance support availability, and adherence to technical specifications. The firm-fixed-price nature suggests the government is primarily concerned with receiving the specified goods on time and to specification, with penalties potentially tied to non-performance or late delivery.

What is the risk of technology obsolescence given the contract's start date in 2010 and end date in 2020?

The contract spanned from March 4, 2010, to July 23, 2020, a period of over 10 years. In the rapidly evolving field of communications technology, a 10+ year lifecycle for hardware presents a significant risk of obsolescence. While SINCGARS is a foundational system, newer technologies offering enhanced capabilities (e.g., greater bandwidth, improved encryption, software-defined radio features, integration with newer networks) have likely emerged during this period. The risk is that the delivered equipment may become outdated, less interoperable with newer systems, or more difficult to maintain due to diminishing manufacturer support for older components. This necessitates careful planning for future upgrades or replacements to ensure continued operational effectiveness.

Does L3Harris Global Communications, Inc. have a strong track record with the Department of the Army for similar procurements?

L3Harris Global Communications, Inc. (and its predecessor entities) has a long-standing relationship with the Department of Defense, including the Army, for providing various communication and electronic systems. Their track record typically involves supplying radios, encryption devices, and integrated communication solutions. While specific performance metrics for past contracts are not detailed here, L3Harris is generally recognized as a major defense contractor with substantial experience in this domain. The fact that they were awarded this significant contract, even on a sole-source basis, suggests a perceived capability and reliability in meeting the Army's requirements for SINCGARS systems. However, a deeper dive into past performance evaluations and any past issues would be necessary for a comprehensive assessment.

Industry Classification

NAICS: Manufacturing › Communications Equipment Manufacturing › Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 1350 JEFFERSON RD, ROCHESTER, NY, 14623

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $49,996,373

Exercised Options: $49,996,373

Current Obligation: $49,996,373

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W15P7T08DD248

IDV Type: IDC

Timeline