DoD awards $23.2M for data links support, with L3 Technologies Inc. as sole source

Contract Overview

Contract Amount: $23,187,591 ($23.2M)

Contractor: L3 Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2017-10-24

End Date: 2022-02-02

Contract Duration: 1,562 days

Daily Burn Rate: $14.8K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: IGF::OT::IGF U-2 DATA LINKS SUPPORT AND SUSTAINMENT

Place of Performance

Location: SALT LAKE CITY, SALT LAKE County, UTAH, 84116

State: Utah Government Spending

Plain-Language Summary

Department of Defense obligated $23.2 million to L3 TECHNOLOGIES, INC. for work described as: IGF::OT::IGF U-2 DATA LINKS SUPPORT AND SUSTAINMENT Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Long performance period of over 4 years suggests a critical, ongoing need. 3. Firm-fixed-price contract type shifts risk to the contractor. 4. The contract's value is moderate within the broader defense IT services sector. 5. Performance is located in Utah, potentially impacting local workforce. 6. No small business set-aside was utilized for this award.

Value Assessment

Rating: fair

The contract value of $23.2 million over approximately four years for data link support and sustainment appears moderate. Without specific benchmarks for similar data link sustainment contracts, a precise value-for-money assessment is challenging. The firm-fixed-price structure is generally favorable for the government in controlling costs, but the sole-source nature limits the ability to benchmark against competitive bids. Further analysis would require comparing the delivered services and technical performance against industry standards and the pricing of comparable sole-source awards.

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 price discovery through market forces was not leveraged, potentially leading to higher costs for the government compared to a competitive procurement. The justification for sole-source awards should be carefully reviewed to ensure it aligns with federal acquisition regulations.

Taxpayer Impact: Sole-source awards limit the government's ability to secure the best possible pricing through competitive bidding, potentially resulting in less favorable value for taxpayer funds.

Public Impact

The Department of Defense benefits from continued support and sustainment of critical data link systems. Essential communication and operational capabilities for military units are maintained. The primary geographic impact is in Utah, where the contractor is located. Potential for specialized technical jobs within the defense sector in Utah.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potentially increases cost to taxpayers.
Lack of transparency in the sole-source justification process.
Long contract duration without competitive re-evaluation could lead to complacency or price creep.

Positive Signals

Firm-fixed-price contract shifts cost overrun risk to the contractor.
Sustainment contract indicates a stable, ongoing need for critical capabilities.
Contractor's established presence suggests potential for reliable service delivery.

Sector Analysis

This contract falls within the broader Information Technology and Engineering Services sector, specifically supporting defense communications infrastructure. The market for specialized data link support and sustainment is often concentrated among a few key defense contractors due to the unique technical requirements and security clearances involved. While specific market size data for 'data link sustainment' is not readily available, the overall defense IT services market is substantial, with significant government spending allocated to maintaining and upgrading communication systems.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. The absence of small business participation could limit opportunities for smaller firms to contribute to this defense program and potentially reduce the overall economic benefit to the small business ecosystem. Future procurements of this nature should explore opportunities for small business engagement.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. The firm-fixed-price contract type provides a degree of cost control. Transparency regarding the sole-source justification and the specific performance metrics would be key to assessing accountability. Further details on specific oversight mechanisms and reporting requirements would be available in the contract documentation.

Related Government Programs

Defense Communication Systems
Military Data Link Technology
IT Support Services for DoD
Engineering Services for Defense

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns without competitive pressure

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.2 million to L3 TECHNOLOGIES, INC.. IGF::OT::IGF U-2 DATA LINKS SUPPORT AND SUSTAINMENT

Who is the contractor on this award?

The obligated recipient is L3 TECHNOLOGIES, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $23.2 million.

What is the period of performance?

Start: 2017-10-24. End: 2022-02-02.

What is the track record of L3 Technologies, Inc. in providing data link support and sustainment services to the Department of Defense?

L3 Technologies, Inc. (now part of L3Harris Technologies) has a significant history of providing a wide range of defense and aerospace products and services, including those related to communications, intelligence, surveillance, and reconnaissance (ISR). Their involvement in data link support and sustainment is consistent with their core capabilities. While specific performance metrics for this particular $23.2 million contract are not detailed in the provided data, the company's extensive experience in the defense sector suggests a strong foundational capability. Government contract databases and performance reviews (like past performance questionnaires) would offer more granular insights into their specific track record on similar programs, including on-time delivery, technical proficiency, and responsiveness to issues.

How does the $23.2 million contract value compare to similar data link support contracts awarded by the DoD?

Benchmarking the $23.2 million value requires comparing it to similar data link support and sustainment contracts. Given the sole-source nature and the provided data, direct comparison is difficult. However, within the broader category of defense IT and engineering services, this value is considered moderate. Contracts for sustainment of complex systems can range from a few million to hundreds of millions of dollars, depending on the system's criticality, technological sophistication, and the scope of services (e.g., hardware maintenance, software updates, training, engineering support). A more precise comparison would involve analyzing contracts with similar performance periods, technical requirements, and contractor capabilities, ideally those awarded competitively to establish a clearer market price.

What are the primary risks associated with this sole-source contract for data link support?

The primary risk associated with this sole-source contract is the potential for inflated pricing due to the lack of competition. Without multiple bidders vying for the contract, the government may not achieve the most cost-effective solution. Another risk is vendor lock-in, where the government becomes heavily reliant on L3 Technologies, Inc. for critical data link sustainment, making it difficult and costly to switch providers in the future. There's also a potential risk of reduced innovation or responsiveness if the contractor faces no competitive pressure to improve services or offer better value. Ensuring robust oversight and clear performance metrics is crucial to mitigate these risks.

How effective is the firm-fixed-price contract type in managing costs for this data link sustainment program?

The firm-fixed-price (FFP) contract type is generally considered effective in managing costs for sustainment programs like this one, as it shifts the majority of the financial risk from the government to the contractor. Under an FFP agreement, the contractor is obligated to complete the work for a predetermined price, regardless of their actual costs. This incentivizes the contractor to manage their expenses efficiently and avoid cost overruns. For the government, it provides cost certainty, making budgeting more predictable. However, the effectiveness of FFP can be diminished in sole-source situations, as the baseline price itself might be higher than in a competitive scenario. Robust contract administration and performance monitoring remain essential.

What are the historical spending patterns for data link support and sustainment within the Department of Defense?

Historical spending patterns for data link support and sustainment within the Department of Defense are substantial and reflect the critical role of secure, reliable communication in modern military operations. The DoD consistently invests billions annually in C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance) capabilities, which heavily rely on robust data links. Spending in this area fluctuates based on technological advancements, geopolitical needs, and the lifecycle of existing systems. While specific figures for 'data link sustainment' as a distinct category are not always granularly reported, it forms a significant component of the overall defense IT and systems engineering budget. Trends show a continuous need for upgrades and maintenance to counter evolving threats and maintain operational superiority.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: FA852717R0020

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 640 N 2200 W, SALT LAKE CITY, UT, 84116

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

Financial Breakdown

Contract Ceiling: $23,405,331

Exercised Options: $23,405,331

Current Obligation: $23,187,591

Subaward Activity

Number of Subawards: 10

Total Subaward Amount: $827,138

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA852716D0011

IDV Type: IDC

Timeline