DoD's $25.2M contract for navigation systems awarded via sole-source procurement

Contract Overview

Contract Amount: $25,251,519 ($25.3M)

Contractor: Canadian Commercial Corporation

Awarding Agency: Department of Defense

Start Date: 2017-08-18

End Date: 2018-08-31

Contract Duration: 378 days

Daily Burn Rate: $66.8K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ACAT III BIG SAFARI

Plain-Language Summary

Department of Defense obligated $25.3 million to CANADIAN COMMERCIAL CORPORATION for work described as: ACAT III BIG SAFARI Key points: 1. Contract awarded without competition, raising questions about potential cost savings. 2. Limited competition may have led to higher prices than a fully competed contract. 3. The contract duration of 378 days is relatively short, suggesting a focused scope. 4. Awarded by the Department of the Air Force, indicating a focus on aviation needs. 5. The North American Industry Classification System (NAICS) code 334511 points to a specialized manufacturing sector. 6. The contractor, Canadian Commercial Corporation, is a foreign entity, which may have unique procurement considerations.

Value Assessment

Rating: questionable

Benchmarking the value of this $25.2 million contract is challenging without a competitive process. The absence of bids means there's no direct comparison to market rates or alternative offerings. The firm fixed-price structure provides some cost certainty, but the lack of competition prevents an assessment of whether the price represents optimal value for the government. Without comparable contracts or a competitive bid process, it's difficult to definitively state if this represents good value for money.

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. This approach is typically used when only one source is capable of meeting the government's needs, or in specific circumstances like urgent requirements. The lack of competition means there were no other bidders to compare against, and the government did not benefit from the price discovery that occurs in a competitive bidding environment.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as there is no competitive pressure to drive down prices. This limits the government's ability to secure the best possible value.

Public Impact

The primary beneficiaries are likely entities within the Department of the Air Force requiring advanced navigation systems. The contract delivers critical components for Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing. The geographic impact is primarily within Department of Defense operations, potentially supporting global missions. Workforce implications may involve specialized manufacturing and technical support roles within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition limits price discovery and potential cost savings for taxpayers.
Sole-source awards can create a perception of favoritism or lack of due diligence in procurement.
Reliance on a single contractor, especially a foreign entity, could pose supply chain risks.
Absence of performance metrics or detailed scope in the provided data makes assessing effectiveness difficult.

Positive Signals

Firm fixed-price contract provides cost certainty for the awarded amount.
Awarded by a major agency (Department of Defense) suggests a critical need for the product/service.
The contractor is a government entity (Canadian Commercial Corporation), which may imply a structured and vetted relationship.

Sector Analysis

The contract falls within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector, a specialized area of the aerospace and defense industry. This sector is characterized by high technological barriers to entry and significant R&D investment. Spending in this area is crucial for national security and advanced technological development. Comparable spending benchmarks would typically be found within other large defense contracts for similar navigation and guidance systems, often involving complex integration and high-precision manufacturing.

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 small businesses based on the information provided. The sole-source nature of the award further reduces the likelihood of small business participation. This contract does not seem to directly contribute to the small business ecosystem's growth through set-asides or mandated subcontracting.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. Accountability measures are inherent in the firm fixed-price structure, which caps the government's liability. Transparency is limited due to the sole-source nature and the absence of publicly available detailed performance reports. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Defense Logistics Agency (DLA) procurement for aerospace components
Naval Air Systems Command (NAVAIR) contracts for aviation systems
Air Force Life Cycle Management Center (AFLCMC) procurements
Federal Aviation Administration (FAA) navigation system contracts

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for higher costs
Limited transparency on selection criteria

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $25.3 million to CANADIAN COMMERCIAL CORPORATION. ACAT III BIG SAFARI

Who is the contractor on this award?

The obligated recipient is CANADIAN COMMERCIAL CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $25.3 million.

What is the period of performance?

Start: 2017-08-18. End: 2018-08-31.

What is the track record of the Canadian Commercial Corporation in delivering similar navigation systems to the U.S. Department of Defense?

The provided data does not offer specific details on the Canadian Commercial Corporation's (CCC) track record for this particular contract or for delivering similar navigation systems to the U.S. Department of Defense. CCC acts as a facilitator for international contracting, often leveraging Canadian industry capabilities. To assess their track record, one would need to examine past performance reviews, delivery history on similar U.S. government contracts, and any reported issues or successes. Without this granular information, it's difficult to evaluate their specific performance reliability for this $25.2 million award.

How does the $25.2 million contract value compare to similar navigation system procurements by the U.S. Air Force?

Direct comparison of the $25.2 million contract value to similar U.S. Air Force procurements is challenging without more specific details on the system's capabilities and scope. However, given the NAICS code 334511 (Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing), this value appears to be within a moderate range for specialized defense systems. Fully competed contracts for complex navigation suites can range from tens of millions to hundreds of millions of dollars. The sole-source nature of this award means it wasn't benchmarked against competitive bids, making a definitive value assessment difficult. Further analysis would require comparing technical specifications and quantities against other awarded contracts in this niche manufacturing area.

What are the primary risks associated with awarding a $25.2 million contract on a sole-source basis for navigation systems?

The primary risks associated with a sole-source award for navigation systems include: 1. **Cost Overruns:** Without competition, the government may pay a higher price than necessary, as there's no market pressure to offer the lowest bid. 2. **Limited Innovation:** A single source may have less incentive to innovate or offer cutting-edge solutions compared to a competitive environment. 3. **Dependency and Lock-in:** The government becomes dependent on a single supplier, potentially leading to difficulties if that supplier faces production issues or decides to exit the market. 4. **Reduced Transparency:** Sole-source awards can be perceived as less transparent, raising concerns about the fairness and justification of the procurement process. 5. **Potential for Suboptimal Performance:** While not guaranteed, the absence of competitive pressure could theoretically lead to less focus on optimal performance or delivery timelines.

What specific navigation system capabilities does this $25.2 million contract cover, and how critical are they to Air Force operations?

The provided data identifies the contract under NAICS code 334511 ('Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing') and mentions 'ACAT III BIG SAFARI' as the program. 'BIG SAFARI' is an Air Force program focused on rapid acquisition of intelligence, surveillance, and reconnaissance (ISR) capabilities. ACAT III indicates a lower defense acquisition category, suggesting a less complex or lower-cost system compared to ACAT I or II. While specific capabilities aren't detailed, it's reasonable to infer the contract supports navigation and guidance systems crucial for ISR aircraft operations, enabling precise flight paths, target identification, and mission execution. The criticality lies in ensuring mission success and personnel safety in complex operational environments.

How has the Department of the Air Force historically spent funds on navigation system manufacturing (NAICS 334511) and what are the trends?

Historical spending by the Department of the Air Force (DAF) on navigation system manufacturing (NAICS 334511) is substantial, reflecting the critical role of advanced avionics in air power. While specific aggregate data for NAICS 334511 alone is not readily available without specialized databases, the DAF consistently invests billions annually in aircraft procurement, modification, and sustainment, a significant portion of which includes navigation, guidance, and control systems. Trends indicate a move towards more integrated, software-defined systems, increased reliance on GPS and multi-constellation navigation, and a growing demand for resilient navigation solutions that can counter jamming or spoofing. The DAF also increasingly focuses on cybersecurity within these systems. This $25.2 million contract, awarded in 2017, likely represents a component or upgrade within these broader technological shifts.

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 COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Government of Canada (UEI: 241015486)

Address: 50 O'CONNOR ST SUITE 1100, OTTAWA

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $25,251,519

Exercised Options: $25,251,519

Current Obligation: $25,251,519

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA862009D3025

IDV Type: IDC

Timeline