NOAA awards L3Harris $165.5M for 5-year sustainment services, impacting custom computer programming

Contract Overview

Contract Amount: $165,486,834 ($165.5M)

Contractor: L3harris Technologies, Inc.

Awarding Agency: Department of Commerce

Start Date: 2023-05-11

End Date: 2028-05-10

Contract Duration: 1,826 days

Daily Burn Rate: $90.6K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: GGSS TASK ORDER 0002 - SUSTAINMENT SERVICES - 5 YEARS

Place of Performance

Location: MELBOURNE, BREVARD County, FLORIDA, 32902

State: Florida Government Spending

Plain-Language Summary

Department of Commerce obligated $165.5 million to L3HARRIS TECHNOLOGIES, INC. for work described as: GGSS TASK ORDER 0002 - SUSTAINMENT SERVICES - 5 YEARS Key points: 1. Value for money assessed through cost-plus award fee structure, encouraging performance. 2. Full and open competition suggests a robust market for these services. 3. Potential risks include performance variability inherent in cost-plus contracts. 4. Contract duration of 5 years provides long-term stability for sustainment. 5. Positioned within IT services, specifically custom computer programming. 6. No small business set-aside indicates a focus on larger prime contractors.

Value Assessment

Rating: good

The contract's cost-plus award fee structure allows for performance-based adjustments, aiming to align contractor incentives with government objectives. Benchmarking against similar custom computer programming services contracts is crucial to determine if the $165.5 million over five years represents a fair price. The award fee mechanism, if well-defined, can drive efficiency and value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders were likely considered. The level of competition is generally positive for price discovery and ensuring the government receives competitive offers. The specific number of bidders is not provided, but the category suggests a healthy market.

Taxpayer Impact: Full and open competition typically leads to better pricing for taxpayers by fostering a competitive environment among potential contractors.

Public Impact

The National Oceanic and Atmospheric Administration (NOAA) benefits from sustained IT services. Services delivered include custom computer programming and sustainment, crucial for NOAA's operations. The geographic impact is primarily within Florida, where the contractor is located. Workforce implications include potential job creation or retention within L3Harris Technologies, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns in cost-plus contracts if not managed tightly.
Dependence on a single contractor for critical sustainment services over five years.

Positive Signals

Award fee structure incentivizes contractor performance and efficiency.
Long-term contract provides stability and predictability for service delivery.
Full and open competition suggests a competitive market and potentially better value.

Sector Analysis

This contract falls within the Information Technology sector, specifically under Custom Computer Programming Services (NAICS 541511). This is a significant category for government IT spending, supporting a wide range of agency functions. Comparable spending benchmarks would involve analyzing other large IT sustainment contracts awarded by federal agencies for similar services.

Small Business Impact

The contract indicates that small business participation was not a primary set-aside objective for this specific award, as 'sb' is false. This suggests that the prime contract was awarded to a large business. Subcontracting opportunities for small businesses may exist, but they are not mandated through a specific set-aside program for this contract.

Oversight & Accountability

Oversight for this contract would typically be managed by NOAA contracting officers and program managers. The cost-plus award fee structure implies performance monitoring and evaluation to determine award fee amounts. Transparency is generally maintained through contract award databases, though detailed performance metrics may not be publicly disclosed.

Related Government Programs

IT Sustainment Services
Custom Computer Programming
Federal IT Contracts
NOAA IT Modernization

Risk Flags

Cost-Plus contract risk
Long-term vendor lock-in potential

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $165.5 million to L3HARRIS TECHNOLOGIES, INC.. GGSS TASK ORDER 0002 - SUSTAINMENT SERVICES - 5 YEARS

Who is the contractor on this award?

The obligated recipient is L3HARRIS TECHNOLOGIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Commerce (National Oceanic and Atmospheric Administration).

What is the total obligated amount?

The obligated amount is $165.5 million.

What is the period of performance?

Start: 2023-05-11. End: 2028-05-10.

What is the historical spending pattern of NOAA with L3Harris Technologies, Inc. for similar services?

Analyzing historical spending between NOAA and L3Harris Technologies, Inc. for similar IT sustainment and custom programming services is essential for context. Without specific historical data, it's difficult to ascertain if this $165.5 million award represents an increase, decrease, or consistent level of investment. Reviewing past contract values, durations, and performance reviews for this contractor would reveal trends in their service provision to NOAA and help benchmark the current award's scale and potential value.

How does the cost-plus award fee structure compare to fixed-price contracts for similar IT sustainment services?

Cost-plus award fee (CPAF) contracts, like this one, reimburse the contractor for allowable costs and provide a base fee plus an award fee based on performance against defined criteria. This contrasts with fixed-price contracts, where the price is set regardless of actual costs. CPAF is often used when requirements are not fully defined or when performance incentives are critical. While CPAF can encourage higher performance and flexibility, it carries a higher risk of cost overrun for the government if not meticulously managed and monitored compared to fixed-price contracts, which offer greater cost certainty but may disincentivize exceeding basic performance levels.

What are the key performance indicators (KPIs) used to determine the award fee for L3Harris Technologies, Inc. under this contract?

The specific Key Performance Indicators (KPIs) used to determine the award fee for L3Harris Technologies, Inc. are not detailed in the provided data. Typically, for IT sustainment and custom programming services, KPIs might include system uptime, response times to issues, successful implementation of updates or new features, adherence to security protocols, user satisfaction, and timely delivery of project milestones. The effectiveness of the award fee structure hinges on clearly defined, measurable, and achievable KPIs that directly align with NOAA's mission-critical objectives for these services.

What is the potential impact of a 5-year contract duration on service innovation and contractor responsiveness?

A 5-year contract duration provides significant stability and allows the contractor, L3Harris Technologies, Inc., to invest in resources and personnel for NOAA's sustainment services. This long-term commitment can foster deeper understanding of NOAA's needs and lead to more tailored solutions. However, it can also potentially reduce the incentive for continuous innovation if not coupled with strong performance incentives and regular reviews. Contractor responsiveness might be high due to the long-term relationship, but the risk of complacency increases over time if performance metrics are not rigorously enforced and updated.

How does the NAICS code 541511 (Custom Computer Programming Services) typically benchmark in terms of pricing and service scope for federal contracts?

NAICS code 541511, Custom Computer Programming Services, encompasses a broad range of activities from software development to system integration and IT consulting. Benchmarking pricing for this category is complex due to the variability in skill sets, project complexity, and geographic location. Federal contracts under this code can range significantly in value. Generally, government rates for specialized IT programming services are competitive with, and sometimes higher than, private sector rates due to security clearances, specific compliance requirements, and the need for long-term support. The $165.5 million over five years for NOAA suggests a substantial, ongoing requirement.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 2400 PALM BAY RD NE, PALM BAY, FL, 32905

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: $190,415,326

Exercised Options: $190,415,326

Current Obligation: $165,486,834

Actual Outlays: $75,218,641

Subaward Activity

Number of Subawards: 160

Total Subaward Amount: $64,463,112

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: 1332KP23DNAAA0003

IDV Type: IDC

Timeline