DoD's $44.6M optics support contract awarded to Goodrich Corporation raises value and competition concerns

Contract Overview

Contract Amount: $44,659,452 ($44.7M)

Contractor: Goodrich Corporation

Awarding Agency: Department of Defense

Start Date: 2018-11-01

End Date: 2024-01-25

Contract Duration: 1,911 days

Daily Burn Rate: $23.4K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SUPPORT AND SUSTAINMENT FOR OPTICS

Place of Performance

Location: WOBURN, MIDDLESEX County, MASSACHUSETTS, 01801

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $44.7 million to GOODRICH CORPORATION for work described as: SUPPORT AND SUSTAINMENT FOR OPTICS Key points: 1. The contract's value for money is questionable given the lack of competitive bidding. 2. Competition dynamics were limited, with the contract being awarded on a sole-source basis. 3. Risk indicators include the sole-source award, potentially leading to inflated pricing. 4. Performance context is provided by the contract's duration and firm-fixed-price structure. 5. The contract falls within the Defense sector, specifically related to navigation and guidance systems. 6. The absence of a small business set-aside suggests limited opportunities for smaller enterprises. 7. The contract's total value of $44.6 million warrants scrutiny for efficiency.

Value Assessment

Rating: questionable

Benchmarking the value for money is challenging without comparable contract data due to the sole-source nature of this award. The firm-fixed-price structure provides cost certainty but does not inherently guarantee optimal pricing without competition. The total value of $44.6 million over its duration suggests a significant investment in optics support, and further analysis would be needed to determine if this represents a fair market price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning there was no open competition among multiple bidders. This approach is typically used when a specific contractor possesses unique capabilities or when urgency dictates a rapid award. The lack of competition limits the government's ability to leverage market forces to achieve the best possible pricing and terms.

Taxpayer Impact: Taxpayers may have paid a premium for this contract due to the absence of competitive pressure. Without competing offers, there is a reduced incentive for the contractor to offer the lowest possible price.

Public Impact

The Department of Defense is the primary beneficiary, receiving essential support for optics systems. Services delivered include sustainment and support for critical optics, likely for navigation and guidance. The geographic impact is concentrated within the operational areas of the Department of Defense. Workforce implications may include specialized technical roles for the contractor's employees supporting these systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially increases costs for taxpayers.
Lack of competition may reduce incentives for innovation and efficiency from the contractor.
Contract duration of over 5 years (1911 days) represents a long-term commitment without competitive re-evaluation.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Award to Goodrich Corporation, a known entity in defense contracting, may indicate established capabilities.
Contract supports critical defense systems, ensuring operational readiness.

Sector Analysis

This contract falls within the broader aerospace and defense industry, specifically focusing on the manufacturing and support of navigation, guidance, and control systems. The market for such specialized components is often characterized by high barriers to entry due to technological complexity and stringent quality requirements. Spending in this sub-sector is driven by defense modernization efforts and the need for reliable, high-performance equipment.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it appear to involve significant subcontracting opportunities for them based on the available information. This suggests that the primary contractor, Goodrich Corporation, is likely handling the majority of the work. Consequently, the direct impact on the small business ecosystem for this specific award is likely minimal.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Accountability measures are inherent in the firm-fixed-price structure, which caps the government's liability. Transparency is limited by the sole-source nature of the award, but contract modifications and performance reports would be subject to internal DoD review.

Related Government Programs

Defense Logistics Agency (DLA) Support Contracts
Naval Air Systems Command (NAVAIR) Procurement
Air Force Materiel Command (AFMC) Contracts
Army Combat Capabilities Development Command (DEVCOM) Systems

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 $44.7 million to GOODRICH CORPORATION. SUPPORT AND SUSTAINMENT FOR OPTICS

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 $44.7 million.

What is the period of performance?

Start: 2018-11-01. End: 2024-01-25.

What is Goodrich Corporation's track record with similar sole-source optics support contracts within the Department of Defense?

Assessing Goodrich Corporation's track record with similar sole-source optics support contracts requires access to historical contract databases and performance reviews. Generally, large defense contractors like Goodrich have extensive experience fulfilling sole-source requirements due to specialized capabilities or existing system integration. However, the absence of competition on this $44.6 million contract means that direct comparisons of pricing and value against competitive awards are not feasible. Further investigation into past performance metrics, any documented issues, and the justification for previous sole-source awards to Goodrich for similar services would be necessary to fully evaluate their track record in this specific context. Without such data, it's difficult to definitively state their performance on comparable sole-source engagements.

How does the $44.6 million total contract value compare to industry benchmarks for similar optics support and sustainment services?

Directly comparing the $44.6 million total contract value to industry benchmarks for similar optics support and sustainment services is challenging due to the sole-source nature of this award and the specific, potentially proprietary, nature of the optics involved. Typically, competitive bidding allows for price discovery and benchmarking against market rates. In the absence of competition, the government relies on historical pricing, should-cost analyses, or independent government cost estimates. If this contract involves highly specialized or legacy optics, the costs could be higher than standard commercial equivalents. A thorough benchmark would require detailed cost breakdowns, understanding the scope of work (e.g., repair, upgrade, calibration), and comparing against other sole-source or competitively awarded contracts for analogous, albeit not identical, defense systems.

What are the primary risk indicators associated with this sole-source contract award, and how are they being mitigated?

The primary risk indicator for this sole-source contract is the lack of competition, which can lead to inflated pricing, reduced innovation, and potential complacency from the contractor. Without competing bids, there is less pressure on Goodrich Corporation to offer the most cost-effective solution or to proactively improve services. Mitigation strategies typically involve robust government oversight, including detailed technical reviews, cost analysis, and performance monitoring. The firm-fixed-price structure provides some cost control by capping the government's liability. However, the effectiveness of these mitigation efforts depends heavily on the resources and expertise dedicated by the contracting agency and the DCMA to scrutinize the contractor's performance and costs throughout the contract's duration.

What is the expected program effectiveness or outcome of awarding this contract to Goodrich Corporation for optics support?

The expected program effectiveness hinges on Goodrich Corporation's ability to deliver reliable and timely support for the specified optics systems, thereby ensuring the operational readiness of the Department of Defense assets that depend on them. Given Goodrich's established presence in the defense sector, the expectation is that they possess the necessary technical expertise, infrastructure, and personnel to maintain and sustain these critical components. The firm-fixed-price contract structure aims to ensure that the government receives the defined scope of support within the agreed-upon budget. Success will be measured by factors such as system uptime, turnaround time for repairs or maintenance, and adherence to technical specifications, ultimately contributing to the overall mission effectiveness of the DoD.

How does the historical spending pattern for optics support within the DoD compare to this specific $44.6 million contract?

Analyzing historical spending patterns for optics support within the DoD requires a broad look at various contracts across different services and timeframes. This $44.6 million contract represents a significant, but not necessarily anomalous, investment for a single, long-duration support agreement. DoD spending on optics can fluctuate based on modernization programs, operational tempo, and the lifecycle of existing systems. Without specific data on the types of optics supported (e.g., targeting systems, navigation sensors, imaging equipment) and the duration of previous contracts, a precise comparison is difficult. However, large-scale, multi-year sustainment contracts are common in defense procurement, especially for specialized equipment where a single contractor holds critical knowledge or intellectual property.

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: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

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: $45,735,808

Exercised Options: $45,735,808

Current Obligation: $44,659,452

Actual Outlays: $406,970

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA852816D0008

IDV Type: IDC

Timeline