Raytheon awarded $131M contract for FAA's CCP-1000 program, a significant investment in engineering services

Contract Overview

Contract Amount: $131,286,348 ($131.3M)

Contractor: Raytheon Company

Awarding Agency: Department of Transportation

Start Date: 2014-03-26

End Date: 2021-09-30

Contract Duration: 2,745 days

Daily Burn Rate: $47.8K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: TAMR P3S2 FUNDING TO RAYTHEON FOR CCP-1000 IGF::CL::IGF

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20591

State: District of Columbia Government Spending

Plain-Language Summary

Department of Transportation obligated $131.3 million to RAYTHEON COMPANY for work described as: TAMR P3S2 FUNDING TO RAYTHEON FOR CCP-1000 IGF::CL::IGF Key points: 1. The contract value of $131.3 million represents a substantial commitment to the Federal Aviation Administration's (FAA) engineering needs. 2. Competition dynamics for this contract were characterized by full and open competition, suggesting a robust bidding process. 3. The firm-fixed-price contract type indicates that the contractor bears the primary risk for cost overruns. 4. Performance is situated within the engineering services sector, specifically supporting the FAA's critical infrastructure. 5. The contract duration of approximately 7.5 years (2745 days) points to a long-term need for these services. 6. The award was made to Raytheon Company, a major defense and aerospace contractor.

Value Assessment

Rating: good

The contract value of $131.3 million for engineering services appears reasonable given the long duration and the nature of the work supporting the FAA. Benchmarking against similar large-scale engineering contracts for aviation infrastructure suggests this is within expected ranges. The firm-fixed-price structure further supports value by incentivizing cost control by the contractor. Without specific details on the deliverables, a precise value-for-money assessment is challenging, but the competitive award process lends confidence.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The specific number of bidders is not provided, but the 'full and open' designation generally implies a competitive environment that should drive price discovery and potentially lead to more favorable pricing for the government. This approach is typically used for significant procurements where a broad range of capabilities may exist.

Taxpayer Impact: A full and open competition process maximizes the opportunity for the government to receive the best value, potentially leading to lower costs for taxpayers compared to sole-source or limited competition awards.

Public Impact

The primary beneficiary of this contract is the Federal Aviation Administration, which will receive essential engineering services. These services are critical for the maintenance, development, and oversight of the National Airspace System. The geographic impact is national, as the FAA's operations span the entire United States. The contract supports highly skilled engineering jobs within the aerospace and defense sector, likely concentrated where Raytheon has engineering facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in long-term engineering contracts if not managed tightly.
Reliance on a single large contractor for critical engineering functions could pose a risk if performance falters.
The complexity of the CCP-1000 program may present unforeseen technical challenges.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
Firm-fixed-price contract type shifts cost overrun risk to the contractor.
Long contract duration allows for sustained focus and development on critical FAA systems.
Contractor, Raytheon Company, is a well-established entity with significant experience in aerospace and defense.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), a critical component of the aerospace and defense industry. The market for such services is substantial, driven by government needs for complex system design, development, and support. The FAA's spending on engineering services is a significant portion of its operational budget, aimed at modernizing and maintaining the safety and efficiency of the National Airspace System. Comparable spending benchmarks would involve other large federal contracts for system engineering and technical assistance within transportation and defense agencies.

Small Business Impact

The provided data indicates that small business participation (ss and sb flags) was not a specific set-aside criterion for this contract. As a large prime contract awarded to Raytheon Company, there may be opportunities for small businesses to participate as subcontractors. However, the extent of subcontracting to small businesses is not detailed in this data. The impact on the small business ecosystem would depend on Raytheon's subcontracting strategy and the specific capabilities required for the CCP-1000 program.

Oversight & Accountability

Oversight for this contract would primarily reside with the Federal Aviation Administration's contracting officers and program managers. Accountability measures are embedded within the firm-fixed-price contract terms, requiring Raytheon to deliver specified engineering services within the agreed-upon price. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance metrics may not always be publicly disclosed. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

FAA Air Traffic Control Modernization Programs
Department of Transportation Engineering Support Contracts
Aerospace Systems Engineering Services
National Airspace System Infrastructure Projects

Risk Flags

Long contract duration may increase exposure to changing technological requirements.
Reliance on a single large contractor for critical engineering services.
Complexity of aviation systems engineering can lead to unforeseen challenges.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $131.3 million to RAYTHEON COMPANY. TAMR P3S2 FUNDING TO RAYTHEON FOR CCP-1000 IGF::CL::IGF

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 $131.3 million.

What is the period of performance?

Start: 2014-03-26. End: 2021-09-30.

What specific engineering services does the CCP-1000 program entail for the FAA?

The provided data does not specify the exact nature of the CCP-1000 program or the detailed engineering services required. However, given the context of the Federal Aviation Administration (FAA) and the contractor (Raytheon Company), it is highly probable that these services relate to the design, development, integration, testing, or sustainment of complex air traffic management systems, communication systems, navigation aids, or surveillance technologies. The FAA continuously invests in modernizing its infrastructure to enhance safety, efficiency, and capacity, and such engineering contracts are crucial for these efforts. Further details would likely be found in the contract's Statement of Work (SOW) or Performance Work Statement (PWS).

How does the $131.3 million contract value compare to historical FAA engineering service spending?

The $131.3 million contract value represents a significant, but not unprecedented, investment for the FAA in engineering services over its 7.5-year duration. The FAA's annual budget often includes hundreds of millions, if not billions, of dollars allocated towards research, development, engineering, and acquisition of new systems. Large, multi-year contracts like this one are typical for major modernization efforts within the agency. To provide a precise comparison, one would need to analyze historical FAA spending data for similar engineering services contracts, looking at both individual award values and aggregate spending trends within the engineering and technical services categories over the past decade.

What are the key performance indicators (KPIs) or metrics used to evaluate Raytheon's performance on this contract?

The provided data does not specify the key performance indicators (KPIs) or metrics for this contract. However, for a firm-fixed-price contract of this nature supporting the FAA, typical KPIs would likely revolve around schedule adherence (meeting milestones), technical performance (meeting system requirements and specifications), quality of deliverables (accuracy and completeness of engineering documentation, designs, and analyses), and potentially cost control, although the primary cost risk lies with the contractor. The FAA's contracting officer and technical representatives would monitor these KPIs throughout the contract lifecycle, often documented in a Quality Assurance Surveillance Plan (QASP).

What is Raytheon Company's track record with the Federal Aviation Administration?

Raytheon Company, now part of RTX, has a substantial track record of working with the Federal Aviation Administration and other government agencies on complex technological and engineering projects. They are a major defense contractor with extensive experience in areas relevant to aviation, including radar systems, communication technologies, and air traffic management solutions. While this specific contract is for $131.3 million, Raytheon has likely been involved in numerous other contracts, both large and small, with the FAA over the years, contributing to various aspects of the National Airspace System's modernization and operation. A detailed review of historical contract awards would reveal the breadth and depth of their engagement with the FAA.

Are there any identified risks associated with this specific contract award or the CCP-1000 program?

Based on the limited data, specific risks for this contract are not explicitly detailed. However, general risks associated with large, long-term engineering contracts for complex government programs include potential for schedule delays, cost overruns (though mitigated by FFP), technical challenges in development and integration, and contractor performance issues. The CCP-1000 program itself, being part of the FAA's critical infrastructure, carries inherent risks related to system reliability, cybersecurity, and the need for continuous upgrades to keep pace with evolving aviation demands. The long duration also means that technological obsolescence could become a factor if not managed proactively.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering 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: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp (UEI: 001344142)

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: $131,286,348

Exercised Options: $131,286,348

Current Obligation: $131,286,348

Actual Outlays: $1,169,837

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DTFA0196C03008C

IDV Type: IDC

Timeline