DoD awards $23.8M for maritime and spectral enhancements to Goodrich Corporation, a sole-source contract

Contract Overview

Contract Amount: $23,821,532 ($23.8M)

Contractor: Goodrich Corporation

Awarding Agency: Department of Defense

Start Date: 2012-06-15

End Date: 2015-04-15

Contract Duration: 1,034 days

Daily Burn Rate: $23.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: LETTER CONTRACT TO AWARD A UNDEFINITZED CONTRACT ACTION (UCA) FOR THE SYERS 2B MARITIME&SPECTRAL ENHANCEMENTS

Place of Performance

Location: WESTFORD, MIDDLESEX County, MASSACHUSETTS, 01886

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $23.8 million to GOODRICH CORPORATION for work described as: LETTER CONTRACT TO AWARD A UNDEFINITZED CONTRACT ACTION (UCA) FOR THE SYERS 2B MARITIME&SPECTRAL ENHANCEMENTS Key points: 1. The contract was awarded on a sole-source basis, raising questions about potential price competition. 2. The duration of the contract is over 1000 days, indicating a significant, long-term need. 3. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 4. The award value of $23.8 million suggests a substantial investment in specialized systems. 5. The North American Industry Classification System (NAICS) code 334511 points to a focus on manufacturing advanced navigation and guidance instruments. 6. The contract was awarded by the Defense Contract Management Agency, suggesting oversight of a major defense supplier.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without more detailed cost breakdowns or comparisons to similar sole-source awards. The Cost Plus Fixed Fee structure inherently carries a risk of costs exceeding initial estimates, as the contractor is reimbursed for allowable costs plus a fixed fee. Without competitive bidding, it's difficult to ascertain if the fixed fee represents a fair profit margin or if the overall cost structure is optimized for value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor possesses the necessary capabilities, technology, or security clearances. The lack of competition means that the government did not benefit from the price discovery mechanisms that typically occur in a competitive bidding process.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. The government's ability to negotiate the best possible price is diminished in sole-source situations.

Public Impact

The primary beneficiaries are likely the Department of Defense and its operational units requiring advanced maritime and spectral enhancement capabilities. The services delivered are related to the manufacturing and enhancement of search, detection, navigation, guidance, and related systems. The geographic impact is primarily within the United States, where Goodrich Corporation operates and where these advanced systems would be deployed. Workforce implications include specialized manufacturing and engineering roles within Goodrich Corporation and potentially its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Cost Plus Fixed Fee contract type can incentivize higher spending if not rigorously managed.
Lack of transparency in the sole-source justification could obscure potential alternatives.
Long contract duration may indicate a lack of readily available alternative solutions.
The specific nature of 'spectral enhancements' could be a proprietary technology, limiting competition.

Positive Signals

Goodrich Corporation is a known entity in defense contracting, suggesting a degree of reliability.
The contract addresses specific, potentially critical, maritime and spectral enhancement needs for the DoD.
The award is for a definitive contract, implying a clear scope of work and expected deliverables.
The contract is managed by the Defense Contract Management Agency, indicating oversight.

Sector Analysis

The contract falls within the broader aerospace and defense manufacturing sector, specifically focusing on advanced navigation and guidance systems. This sector is characterized by high R&D investment, long product development cycles, and significant government procurement. Comparable spending benchmarks would involve other contracts for sophisticated sensor, navigation, or electronic warfare systems, which often involve substantial dollar values due to technological complexity and specialized manufacturing requirements.

Small Business Impact

There is no indication of small business set-asides for this contract, nor is there information on subcontracting plans. Given the specialized nature of maritime and spectral enhancements, it is possible that the prime contractor, Goodrich Corporation, is expected to utilize its own specialized facilities and expertise. Further analysis would be needed to determine if small businesses are involved in the supply chain or if subcontracting opportunities exist.

Oversight & Accountability

The Defense Contract Management Agency (DCMA) is responsible for overseeing this contract, ensuring compliance with terms and conditions, and monitoring performance. As a Cost Plus Fixed Fee contract, rigorous financial oversight is crucial to manage allowable costs and the fixed fee. Transparency regarding the justification for the sole-source award and periodic performance reviews would be key accountability measures. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Advanced Research Projects Agency (DARPA) research programs
Naval Sea Systems Command (NAVSEA) procurements
Intelligence, Surveillance, and Reconnaissance (ISR) systems
Electronic Warfare systems
Maritime surveillance technology

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Lack of competitive bidding
Potential for cost overruns
Extended contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.8 million to GOODRICH CORPORATION. LETTER CONTRACT TO AWARD A UNDEFINITZED CONTRACT ACTION (UCA) FOR THE SYERS 2B MARITIME&SPECTRAL ENHANCEMENTS

Who is the contractor on this award?

The obligated recipient is GOODRICH CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $23.8 million.

What is the period of performance?

Start: 2012-06-15. End: 2015-04-15.

What is the specific nature of the 'maritime & spectral enhancements' being procured, and why was a sole-source award necessary?

The provided data does not detail the specific 'maritime & spectral enhancements.' However, the NAICS code 334511 (Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing) suggests these enhancements relate to advanced sensor technology, navigation systems, or potentially electronic warfare capabilities for maritime platforms. A sole-source award is typically justified when a unique technology, proprietary knowledge, or critical capability resides with only one contractor, or in situations requiring urgent and unforeseen needs where competition is impractical. Without further documentation, the precise reason for Goodrich Corporation being the sole source remains unconfirmed, but it likely stems from specialized intellectual property or existing system integration expertise.

How does the Cost Plus Fixed Fee (CPFF) contract structure compare to other contract types for similar defense procurements, and what are the associated risks?

The Cost Plus Fixed Fee (CPFF) contract type is common in research and development or complex system integration projects where the scope of work is not fully defined at the outset, or where innovation is a primary objective. In CPFF contracts, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. Compared to Firm-Fixed-Price (FFP) contracts, CPFF offers more flexibility for the government to adapt to evolving requirements but carries a higher risk of cost overruns, as the contractor has less incentive to control costs beyond what is necessary to complete the work. The government's primary risk is that the final cost could significantly exceed initial estimates, while the contractor's risk is limited to ensuring costs remain allowable and the fixed fee is earned. Robust oversight and detailed cost accounting are essential to mitigate these risks.

What is Goodrich Corporation's track record with sole-source Cost Plus Fixed Fee contracts with the Department of Defense?

Assessing Goodrich Corporation's specific track record with sole-source CPFF contracts requires access to historical contract databases and detailed award histories. However, as a major defense contractor, Goodrich has extensive experience with various contract types, including CPFF, across numerous programs. Their ability to secure sole-source awards suggests a history of providing critical technologies or services that the Department of Defense deems unique or essential. The effectiveness and value derived from such contracts depend heavily on the government's oversight, negotiation capabilities, and the contractor's performance in managing costs and delivering on technical requirements. Without specific data on past sole-source CPFF awards to Goodrich, a definitive assessment of their track record in this specific context is not possible from the provided information.

What is the historical spending pattern for 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' (NAICS 334511) by the Department of Defense?

Historical spending patterns for NAICS code 334511 by the Department of Defense (DoD) indicate a consistent and significant investment in advanced systems. This sector is crucial for military operations, encompassing everything from radar and sonar systems to GPS navigation and flight control instruments. Spending in this area typically fluctuates based on modernization priorities, geopolitical events, and the development of new technologies. The DoD is a primary customer for manufacturers in this space, often awarding large, multi-year contracts for complex systems. While specific aggregate spending figures for this NAICS code by the DoD are not provided here, it is understood to be a substantial category within the defense industrial base, reflecting the ongoing need for cutting-edge sensing and navigation capabilities.

What are the potential risks associated with the long duration (1034 days) of this contract, especially given its sole-source and CPFF nature?

The long duration of 1034 days for this sole-source CPFF contract presents several potential risks. Firstly, the extended timeline increases the likelihood of scope creep or evolving requirements, which, under a CPFF structure, can lead to escalating costs without necessarily providing proportional value. Secondly, the lack of competition over such a long period means that the government is locked into a single provider, potentially missing out on technological advancements or cost efficiencies that might emerge from other market players. Thirdly, the longer the contract, the greater the potential for performance issues or unforeseen challenges to arise, which can be more complex and costly to resolve in a sole-source, cost-reimbursable environment. Finally, maintaining effective oversight and ensuring continued value for money over more than two and a half years requires sustained government attention and resources.

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: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp (UEI: 001344142)

Address: 7 TECHNOLOGY PARK DR, WESTFORD, MA, 01886

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: $24,024,814

Exercised Options: $24,024,814

Current Obligation: $23,821,532

Subaward Activity

Number of Subawards: 5

Total Subaward Amount: $1,242,004

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline