DOT's $575M contract with Harris Corporation for telecommunications resellers shows long-term commitment

Contract Overview

Contract Amount: $575,466,339 ($575.5M)

Contractor: Harris Corporation

Awarding Agency: Department of Transportation

Start Date: 2005-02-01

End Date: 2025-09-30

Contract Duration: 7,546 days

Daily Burn Rate: $76.3K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: DAFIS UDO RECONSTRUCT W/O ADVANCE

Place of Performance

Location: MELBOURNE, BREVARD County, FLORIDA, 32904

State: Florida Government Spending

Plain-Language Summary

Department of Transportation obligated $575.5 million to HARRIS CORPORATION for work described as: DAFIS UDO RECONSTRUCT W/O ADVANCE Key points: 1. The contract's duration suggests a sustained need for telecommunications reseller services. 2. Harris Corporation's long-standing relationship indicates a potentially stable but less competitive market. 3. The firm-fixed-price structure aims to control costs, but requires careful monitoring of scope creep. 4. Performance context is limited without specific delivery order details, but the contract spans over 20 years. 5. This spending falls within the broader IT and telecommunications sector for government operations. 6. The absence of small business set-asides warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its extended duration and the nature of telecommunications reseller services, which can fluctuate in market price. The total obligated amount of $575 million over nearly 20 years averages to approximately $30 million annually. Without specific details on the services provided under each delivery order, a direct comparison to similar contracts is difficult. However, the consistent funding over such a long period suggests a perceived value by the agency, though it may not represent the most cost-effective solution available today.

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 had the opportunity to submit proposals. The specific number of bidders is not provided, but the fact that it was competed openly suggests a degree of market engagement. Over time, as delivery orders are issued, the competitive landscape for those specific orders would be more relevant.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to better pricing and service innovation. It ensures that the government is not locked into a single provider without exploring market alternatives.

Public Impact

The Federal Aviation Administration (FAA) benefits from reliable telecommunications services essential for its operations. This contract supports the delivery of telecommunications reseller services across various FAA facilities. The geographic impact is primarily within Florida, where the contractor is located, but services likely extend to FAA operations nationwide. Workforce implications are likely concentrated within Harris Corporation and its subcontractors, supporting telecommunications infrastructure and support roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration may reduce agility to adopt newer technologies.
Lack of specific performance metrics makes value assessment difficult.
Potential for vendor lock-in despite initial open competition.

Positive Signals

Consistent service delivery over a long period.
Firm-fixed-price contract provides cost predictability.
Awarded through full and open competition.

Sector Analysis

This contract falls within the broader Information Technology and Telecommunications sector, specifically focusing on reseller services. The telecommunications market is characterized by rapid technological advancements and evolving service models. Government spending in this area is crucial for maintaining communication infrastructure. Comparable spending benchmarks are difficult to establish without knowing the exact services rendered, but large, long-term contracts for telecommunications support are common across federal agencies.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. This suggests that opportunities for small businesses may be limited unless they are prime contractors on specific delivery orders or are engaged as subcontractors by Harris Corporation. Further analysis of subcontracting plans would be needed to assess the full impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the Federal Aviation Administration. Accountability is established through the terms of the contract and the firm-fixed-price delivery orders. Transparency is facilitated through contract databases like DAFIS, though detailed performance reports are often internal. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Federal Information Technology, Acquisition Reform Act (FITARA)
Telecommunications Services Contracts
Government Communications Infrastructure
FAA Procurement Data

Risk Flags

Long contract duration may lead to technological obsolescence.
Potential for vendor lock-in.
Limited visibility into specific service delivery and performance metrics.
Absence of explicit small business subcontracting requirements.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $575.5 million to HARRIS CORPORATION. DAFIS UDO RECONSTRUCT W/O ADVANCE

Who is the contractor on this award?

The obligated recipient is HARRIS CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $575.5 million.

What is the period of performance?

Start: 2005-02-01. End: 2025-09-30.

What specific telecommunications services are being procured under this contract?

The contract is categorized under NAICS code 517310, 'Telecommunications Resellers.' This typically involves the resale of telecommunications services, such as voice, data, and internet access, provided by underlying network carriers. Services could include managed network services, VoIP, dedicated internet access, and other communication solutions tailored to the FAA's operational needs. The exact scope would be detailed in the individual delivery orders issued against this contract, specifying the types of services, quantities, and service level agreements.

How does the $575 million total obligated amount compare to similar long-term telecommunications contracts within the federal government?

Comparing this $575 million contract, spanning nearly two decades, to similar federal telecommunications contracts requires context on the specific services and agency needs. Many large agencies procure substantial telecommunications services, often through multi-year agreements. Contracts for enterprise-wide network services, cloud-based communication solutions, or secure government networks can reach hundreds of millions or even billions of dollars over their lifecycles. The 'reseller' nature of this contract might imply a different cost structure compared to direct network infrastructure providers. Without granular data on service scope and market rates at the time of each award, a precise benchmark is difficult, but the amount reflects a significant, long-term investment in essential communication capabilities for the FAA.

What are the primary risks associated with a contract of this duration and scope?

A primary risk is technological obsolescence; telecommunications technology evolves rapidly, and a contract spanning nearly 20 years may lock the government into outdated solutions. Vendor lock-in is another concern, where the incumbent contractor may gain significant advantages, making it difficult to switch providers even if better options emerge. Performance degradation over time, changes in contractor viability, and the potential for cost overruns if not managed tightly are also risks. Furthermore, the complexity of managing numerous delivery orders over such an extended period can strain oversight resources.

What is the historical spending pattern for this contract and the contractor?

The contract was awarded in February 2005 and is set to expire in September 2025, indicating a continuous funding stream over approximately 20 years. The total obligated amount is $575,466,338.52. This suggests a consistent and substantial level of spending by the Department of Transportation, specifically the Federal Aviation Administration, on telecommunications reseller services from Harris Corporation. The spending pattern appears steady, reflecting an ongoing need for these services throughout the contract's lifecycle. Historical data would reveal if spending has fluctuated significantly year-over-year or if it has remained relatively consistent.

How does the firm-fixed-price contract type influence cost control and risk allocation?

A firm-fixed-price (FFP) contract is designed to provide price certainty for the buyer and shifts most of the risk to the contractor. Under an FFP agreement, the contractor is obligated to perform the work for a stated price, regardless of the actual costs incurred. This incentivizes the contractor to manage its costs efficiently. For the FAA, this means predictable budgeting for the services procured. However, if the scope of work changes significantly, contract modifications (and potential price adjustments) may be necessary. The contractor bears the risk of cost overruns, while the government assumes the risk that the fixed price might be higher than the actual cost of performance.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications Carriers › Telecommunications Resellers

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 243 SHOEMAKER RD, POTTSTOWN, PA, 19464

Business Categories: Category Business, Corporate Entity Tax Exempt, Limited Liability Corporation, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $600,000,000

Exercised Options: $575,466,339

Current Obligation: $575,466,339

Actual Outlays: $174,775,332

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: DTFA0102D03006

IDV Type: IDC

Timeline