DoD Awards Raytheon $272M for Unspecified Services, Lacking Competition

Contract Overview

Contract Amount: $271,988,382 ($272.0M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 1999-12-27

End Date: 2007-07-31

Contract Duration: 2,773 days

Daily Burn Rate: $98.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Place of Performance

Location: MCKINNEY, COLLIN County, TEXAS, 75071

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $272.0 million to RAYTHEON COMPANY for work described as: Key points: 1. Significant award value of $272 million. 2. Sole-source award to Raytheon Company raises competition concerns. 3. Long contract duration (1999-2007) suggests potential for cost overruns. 4. Lack of competition may lead to suboptimal pricing and innovation.

Value Assessment

Rating: questionable

The award value of $272 million is substantial. Without details on the services provided or comparable contracts, it's difficult to assess pricing effectiveness. The lack of competition further clouds the value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning Raytheon was the only vendor considered. This significantly limits price discovery and competition, potentially leading to higher costs for taxpayers.

Taxpayer Impact: The absence of competitive bidding on a $272 million contract likely results in a higher cost to taxpayers than if multiple vendors had competed.

Public Impact

Taxpayers may be overpaying due to the lack of competitive bidding. Limited transparency on the services rendered and their necessity. Potential for reduced innovation and service quality without market pressure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Long contract duration
Unspecified services

Positive Signals

Award to established contractor (Raytheon)

Sector Analysis

The Department of Defense frequently awards large contracts for various services and equipment. Without knowing the specific sector (e.g., IT, defense systems), it's hard to benchmark against industry standards. However, large sole-source awards are common but often scrutinized.

Small Business Impact

The data indicates this contract was not awarded to small businesses (sb: false). This represents a missed opportunity to support small business growth and diversity within the federal contracting landscape.

Oversight & Accountability

The sole-source nature of this award warrants further oversight to ensure the services were necessary and priced appropriately. The long duration also suggests a need for ongoing monitoring of performance and cost.

Related Government Programs

Department of Defense Contracting
Department of the Army Programs

Risk Flags

Lack of competition
Sole-source award justification
Unspecified services
Long contract duration
Potential for cost overruns
No small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $272.0 million to RAYTHEON COMPANY. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $272.0 million.

What is the period of performance?

Start: 1999-12-27. End: 2007-07-31.

What specific services were procured under this $272 million contract, and how was the necessity of these services determined?

The provided data does not specify the services procured. Determining necessity would typically involve detailed documentation from the Department of the Army outlining the requirements, the justification for sole-source procurement, and a thorough needs assessment. Without this information, the value and appropriateness of the expenditure remain unclear.

What risks are associated with awarding a contract of this magnitude on a sole-source basis for an extended period?

The primary risks include inflated pricing due to lack of competition, potential for vendor complacency leading to lower quality or innovation, and the possibility of scope creep or unnecessary services being added over the contract's long duration. There's also a risk that better, more cost-effective solutions may emerge but are not considered due to the sole-source nature.

How can the effectiveness of this contract be evaluated given the limited information and lack of competition?

Evaluating effectiveness is challenging. Ideally, it would involve assessing whether the procured services met the stated requirements, achieved desired outcomes, and were delivered within budget. However, without knowing the services or having comparative data, effectiveness can only be broadly inferred through contractor performance reviews (if available) and by considering the opportunity costs of not pursuing competitive bids.

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 2501 W UNIVERSITY DR, MC KINNEY, TX, 03

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: YES

Timeline