Raytheon's $161.8M WAAS Follow-On Contract Awarded by FAA Under Sole-Source Basis
Contract Overview
Contract Amount: $161,847,650 ($161.8M)
Contractor: Raytheon Company
Awarding Agency: Department of Transportation
Start Date: 2008-09-25
End Date: 2016-08-19
Contract Duration: 2,885 days
Daily Burn Rate: $56.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Transportation
Official Description: WIDE AREA AUGMENTATION SYSTEM (WAAS) FOLLOW-ON CONTRACT
Place of Performance
Location: MARLBOROUGH, MIDDLESEX County, MASSACHUSETTS, 01752
Plain-Language Summary
Department of Transportation obligated $161.8 million to RAYTHEON COMPANY for work described as: WIDE AREA AUGMENTATION SYSTEM (WAAS) FOLLOW-ON CONTRACT Key points: 1. The contract for the Wide Area Augmentation System (WAAS) follow-on was awarded to Raytheon Company. 2. This contract was not competed, indicating a sole-source award. 3. The total value of the contract is $161,847,649.93. 4. The contract period spans from September 25, 2008, to August 19, 2016. 5. The procurement falls under the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' NAICS code.
Value Assessment
Rating: questionable
Pricing for this sole-source contract is difficult to assess without competitive benchmarks. The Cost Plus Fixed Fee (CPFF) structure can lead to cost overruns if not managed carefully, potentially impacting overall value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, which limits price discovery and potentially leads to higher costs for taxpayers. The rationale for a sole-source award needs further justification to ensure fair pricing.
Taxpayer Impact: The lack of competition in this sole-source award may result in higher costs for taxpayers compared to a competitively bid contract.
Public Impact
Ensures continued operation and enhancement of the WAAS, a critical component of the National Airspace System. Supports air traffic safety and efficiency by providing precise navigation and guidance for aircraft. Impacts airlines, pilots, and passengers through reliable navigation services. The sole-source nature raises questions about cost-effectiveness and potential missed savings.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Cost Plus Fixed Fee contract type can incentivize cost growth.
- Lack of transparency in pricing due to no-bid award.
Positive Signals
- Ensures continuity of a critical navigation system.
- Awarded to an established provider with likely expertise.
Sector Analysis
The Federal Aviation Administration (FAA) operates within the Transportation sector, which often involves complex, high-value procurements for infrastructure and systems. Spending benchmarks for navigation systems vary widely based on technology and scope.
Small Business Impact
There is no indication that small businesses were involved in this specific contract award. The prime contractor, Raytheon Company, is a large aerospace and defense firm.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the government is receiving fair value and that the contractor is meeting all performance requirements. Audits of costs would be prudent.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Transportation Contracting
- Federal Aviation Administration Programs
Risk Flags
- Sole-source award
- Cost Plus Fixed Fee contract type
- Lack of competitive bidding
- Potential for cost overruns
- Limited transparency in pricing
Tags
search-detection-navigation-guidance-aer, department-of-transportation, ma, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Transportation awarded $161.8 million to RAYTHEON COMPANY. WIDE AREA AUGMENTATION SYSTEM (WAAS) FOLLOW-ON CONTRACT
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 $161.8 million.
What is the period of performance?
Start: 2008-09-25. End: 2016-08-19.
What was the justification for awarding this contract on a sole-source basis instead of seeking competitive bids?
The justification for a sole-source award typically centers on unique capabilities, proprietary technology, or the absence of adequate competition. For the WAAS follow-on, the rationale might stem from Raytheon's existing role in the system's development or specific technical requirements that only they could meet. Without detailed documentation, it's difficult to ascertain the precise reasoning, but it's a critical factor in evaluating the procurement's fairness and efficiency.
How does the Cost Plus Fixed Fee (CPFF) contract structure impact the risk of cost overruns for this specific system?
The CPFF structure shares cost risk between the government and the contractor. While the fixed fee provides an incentive for the contractor to control costs, the government bears the majority of the cost risk. If unforeseen technical challenges or scope changes arise during the WAAS follow-on, the total contract cost could escalate significantly beyond initial projections, impacting the overall value for taxpayers.
What is the long-term strategic value of the WAAS system and how does this contract contribute to it?
The WAAS is a crucial component of the U.S. air traffic management system, enhancing GPS accuracy and integrity for aviation. This follow-on contract ensures the continued operation, maintenance, and potential upgrades of the system, thereby maintaining safety and efficiency in the National Airspace System. Its long-term value lies in providing reliable, precise navigation, reducing reliance on ground-based systems, and supporting future air traffic modernization efforts.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Product/Service Code: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: WA0806670
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp
Address: 1801 HUGHES DR, FULLERTON, CA, 92833
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: $1,426,880,324
Exercised Options: $168,621,349
Current Obligation: $161,847,650
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2008-09-25
Current End Date: 2016-08-19
Potential End Date: 2020-08-11 00:00:00
Last Modified: 2025-04-01
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