Raytheon Company Awarded $80M FAA Delivery Order for Engineering Services Under STARS Contract

Contract Overview

Contract Amount: $80,021,730 ($80.0M)

Contractor: Raytheon Company

Awarding Agency: Department of Transportation

Start Date: 2021-06-25

End Date: 2025-12-31

Contract Duration: 1,650 days

Daily Burn Rate: $48.5K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: STARS - DELIVERY ORDER 0002 (STARS DOD EFFORT)

Place of Performance

Location: MARLBOROUGH, MIDDLESEX County, MASSACHUSETTS, 01752

State: Massachusetts Government Spending

Plain-Language Summary

Department of Transportation obligated $80.0 million to RAYTHEON COMPANY for work described as: STARS - DELIVERY ORDER 0002 (STARS DOD EFFORT) Key points: 1. Significant contract value of $80M for engineering services. 2. Awarded to Raytheon Company, a major defense contractor. 3. Contract is a delivery order under the STARS program. 4. Potential for cost overruns due to Cost Plus Fixed Fee structure.

Value Assessment

Rating: fair

The Cost Plus Fixed Fee (CPFF) contract type carries inherent risk of cost escalation. Without specific benchmarks for similar FAA engineering services contracts, it's difficult to definitively assess pricing efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs compared to a competitive environment.

Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for these engineering services.

Public Impact

Impacts Federal Aviation Administration's engineering capabilities. Supports critical infrastructure projects through specialized services. Potential for long-term reliance on Raytheon for these services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition.
Cost Plus Fixed Fee contract type can lead to cost overruns.
Lack of transparency in pricing due to non-competitive award.

Positive Signals

Award to established contractor with relevant expertise.
Supports critical FAA engineering needs.

Sector Analysis

Engineering services, particularly within the aerospace and defense sector, are critical for government operations. The $80M award is substantial, but without specific benchmarks for similar FAA engineering contracts, it's hard to gauge efficiency.

Small Business Impact

This award does not appear to involve small business participation, as the prime contractor is Raytheon Company. Further analysis would be needed to determine if any subcontracting opportunities exist for small businesses.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny. Oversight should focus on ensuring the fixed fee is reasonable and that the contractor is delivering services efficiently to mitigate cost risks.

Related Government Programs

Engineering Services
Department of Transportation Contracting
Federal Aviation Administration Programs

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Potential for cost overruns
Lack of competitive pricing benchmarks

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $80.0 million to RAYTHEON COMPANY. STARS - DELIVERY ORDER 0002 (STARS DOD EFFORT)

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $80.0 million.

What is the period of performance?

Start: 2021-06-25. End: 2025-12-31.

What is the justification for the sole-source award, and how does it align with federal procurement regulations for non-competitive contracts?

The provided data indicates the contract was 'NOT COMPETED'. A sole-source award typically requires a strong justification, such as the unique capability of the contractor or an urgent need. The FAA would need to document this justification to comply with federal procurement rules, ensuring that competition was not feasible or practicable.

How will the FAA ensure cost control and value for money given the Cost Plus Fixed Fee contract type and lack of competition?

The FAA should implement robust oversight mechanisms, including detailed performance monitoring and regular cost reviews. Establishing clear performance metrics and milestones, along with a defined fixed fee, are crucial. Regular audits and comparisons to industry standards, where possible, can help ensure value for taxpayer money.

What is the specific nature of the engineering services being procured, and how critical are they to the FAA's mission?

The NAICS code 541330 signifies Engineering Services. While the specific project details are not provided, these services are likely critical for the design, development, maintenance, or modernization of aviation systems, infrastructure, or safety technologies essential to the FAA's mission of ensuring safe and efficient air travel.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 1001 BOSTON POST RD E, MARLBOROUGH, MA, 01752

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: $100,000,000

Exercised Options: $80,021,730

Current Obligation: $80,021,730

Actual Outlays: $49,723,233

Subaward Activity

Number of Subawards: 18

Total Subaward Amount: $3,504,763

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: 693KA721D00001

IDV Type: IDC

Timeline