DOD awards $24.9M contract to Honeywell for unspecified services, raising questions about competition and value

Contract Overview

Contract Amount: $24,927,122 ($24.9M)

Contractor: Honeywell International Inc.

Awarding Agency: Department of Defense

Start Date: 2000-02-02

End Date: 2006-12-31

Contract Duration: 2,524 days

Daily Burn Rate: $9.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Place of Performance

Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87113

State: New Mexico Government Spending

Plain-Language Summary

Department of Defense obligated $24.9 million to HONEYWELL INTERNATIONAL INC. for work described as: Key points: 1. The contract's value of $24.9 million over its duration suggests a significant investment, but the lack of specific service details hinders a precise value-for-money assessment. 2. Awarded as 'NOT COMPETED,' this contract bypasses standard competitive processes, potentially limiting price discovery and increasing risk. 3. The long duration of 2524 days (approximately 7 years) indicates a substantial, long-term commitment, requiring careful monitoring of performance and cost. 4. The contract's classification as 'NM' (likely 'Not Mapped' or similar) for its Product Service Code (PSC) prevents direct comparison with similar IT or defense services. 5. The absence of small business set-aside flags suggests this contract was not specifically targeted to support small businesses. 6. The firm fixed-price contract type provides cost certainty for the government, but the lack of competition may have led to a higher price than a competed award.

Value Assessment

Rating: questionable

Benchmarking the value of this $24.9 million contract is challenging due to the unspecified nature of the services and the lack of a competitive award. Without knowing what services were procured, it's impossible to compare pricing against market rates or similar government contracts. The firm fixed-price structure offers some cost control, but the absence of competition means the government may not have secured the best possible price. Further details on the service scope are needed to make a definitive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a 'NOT COMPETED' procurement method, indicating that a full and open competition was not conducted. The specific reasons for this sole-source award are not detailed in the provided data. A lack of competition typically means only one bidder was considered, which can lead to higher prices and reduced innovation compared to contracts awarded through competitive bidding processes.

Taxpayer Impact: Taxpayers may have paid a premium for these services due to the absence of competitive pressure to drive down costs. The government did not benefit from the potential for multiple offers to explore different pricing structures and service delivery models.

Public Impact

The primary beneficiaries are likely the Department of the Army, which receives the services, and the contractor, Honeywell International Inc. The services procured are not specified, making it difficult to determine the exact nature of the public benefit or impact. The contract is managed by the Department of Defense, suggesting a national-level impact, though the specific geographic or workforce implications are unknown. The contract's duration and value suggest it could support a significant operational need for the Army.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing and reduced value for taxpayer funds.
The unspecified nature of the services makes it difficult to assess performance risks and ensure accountability.
The long contract duration could lead to vendor lock-in or challenges in adapting to evolving needs if not managed proactively.

Positive Signals

Honeywell International Inc. is a large, established defense contractor with a track record of performance.
The firm fixed-price contract type provides cost certainty for the government.
The contract is managed by the Department of Defense, a major federal agency with established oversight processes.

Sector Analysis

This contract falls within the broad category of defense contracting, a significant sector of federal spending. Honeywell International Inc. is a major player in aerospace, defense, and building technologies. The specific service area is unclear due to the 'NM' PSC code, but it represents a substantial financial commitment within the defense industrial base. Comparable spending benchmarks are difficult to establish without knowing the service type, but large, long-term contracts are common in this sector.

Small Business Impact

The provided data indicates that this contract was not awarded as a small business set-aside (ss=false) and does not explicitly mention subcontracting plans related to small businesses (sb=false). This suggests that the primary award went to a large corporation, and there may be limited direct opportunities for small businesses through this specific contract, unless subcontracting is mandated or voluntarily pursued by the prime contractor.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army and the Department of Defense's established procurement and contract management regulations. The firm fixed-price nature provides some cost oversight. However, the lack of competition and unspecified service details could present challenges for effective performance monitoring and accountability. Inspector General jurisdiction would apply if fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Procurement
Defense Services Contracts
Honeywell International Inc. Contracts
Firm Fixed Price Contracts
Sole Source Contracts

Risk Flags

Sole-source award without clear justification
Lack of service detail hinders performance assessment
Potential for inflated pricing due to lack of competition
Long contract duration increases risk of vendor lock-in

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.9 million to HONEYWELL INTERNATIONAL INC.. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is HONEYWELL INTERNATIONAL 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 $24.9 million.

What is the period of performance?

Start: 2000-02-02. End: 2006-12-31.

What specific services were procured under this $24.9 million contract awarded to Honeywell International Inc.?

The provided data does not specify the exact services procured under this contract. The Product Service Code (PSC) is listed as 'NM', which typically indicates 'Not Mapped' or a code that does not clearly define the service category. This lack of specificity is a significant limitation in assessing the contract's purpose, value, and performance. Without knowing the nature of the services, it is impossible to determine if they align with the Department of the Army's mission requirements or to benchmark their cost and effectiveness against industry standards or similar government procurements.

Why was this contract awarded on a sole-source basis ('NOT COMPETED') instead of through full and open competition?

The data indicates the contract was awarded as 'NOT COMPETED,' meaning a competitive process was bypassed. The specific justification for this sole-source award is not provided. Common reasons for sole-source awards include urgent and compelling needs, unique capabilities of a single contractor, or situations where only one source is capable of meeting the requirement. However, without the official justification, it is impossible to verify the necessity of foregoing competition. This lack of competition raises concerns about potential overpayment and reduced opportunities for other qualified vendors.

How does the $24.9 million contract value compare to similar services procured by the Department of Defense or other federal agencies?

Direct comparison of the $24.9 million contract value is difficult due to the unspecified nature of the services and the sole-source award. The 'NM' PSC code prevents identification of comparable contracts. If the services were, for example, IT support, $24.9 million over approximately seven years might be within a reasonable range for a large-scale federal contract, but without specifics, this is purely speculative. The lack of competition means the government may not have achieved the most favorable pricing achievable through a competitive bidding process, potentially inflating the effective cost per unit or service compared to a competed award.

What are the potential risks associated with a long-duration contract (2524 days) awarded on a sole-source basis?

A long-duration contract, such as this 2524-day (approximately 7-year) award, carries inherent risks, especially when awarded sole-source. These risks include potential vendor lock-in, where the government becomes overly reliant on a single provider, making it difficult to switch even if performance declines or better alternatives emerge. There's also a risk of complacency from the contractor, knowing competition is absent. Furthermore, the government's needs may evolve over seven years, and a rigid sole-source contract might not adapt efficiently, potentially leading to suboptimal outcomes or the need for costly modifications. Proactive contract management and performance monitoring are crucial to mitigate these risks.

What is Honeywell International Inc.'s track record with the Department of Defense, and does it suggest a history of reliable performance?

Honeywell International Inc. is a major defense contractor with a long history of supplying goods and services to the Department of Defense and other government agencies. While specific performance details for this particular contract are unavailable, Honeywell generally has a substantial portfolio of federal contracts. Their extensive experience suggests a capacity to manage large, complex agreements. However, like any large contractor, past performance can vary across different contracts and programs. A thorough review of their specific performance history on similar DoD contracts would be necessary for a comprehensive assessment of reliability for this award.

Are there any indications of potential waste, fraud, or abuse associated with this contract, given its sole-source nature and lack of service detail?

The provided data itself does not contain direct evidence of waste, fraud, or abuse. However, the combination of a sole-source award ('NOT COMPETED') and unspecified services ('NM' PSC) creates conditions that increase the risk of such issues. Without competition, there is less transparency and accountability regarding pricing and necessity. The lack of detail on services makes it harder for oversight bodies, including the Inspector General, to effectively monitor performance and ensure funds are used appropriately. These factors warrant closer scrutiny by relevant oversight agencies.

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Honeywell International Inc (UEI: 139691877)

Address: 9201 SAN MATEO BLVD. NE, ALBUQUERQUE, NM, 01

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

Contract Characteristics

Cost or Pricing Data: YES

Timeline