DoD's $73.5M contract for aircraft parts awarded to L3Harris Technologies, with no competition

Contract Overview

Contract Amount: $73,510,752 ($73.5M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2016-12-15

End Date: 2017-12-31

Contract Duration: 381 days

Daily Burn Rate: $192.9K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: IGF::CT::IGF ACAT III BIG SAFARI VIPSAM

Place of Performance

Location: GREENVILLE, HUNT County, TEXAS, 75402

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $73.5 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: IGF::CT::IGF ACAT III BIG SAFARI VIPSAM Key points: 1. The contract value of $73.5 million represents a significant investment in specialized aircraft components. 2. The absence of competition raises concerns about potential overpricing and limited value for taxpayer funds. 3. The contract's duration of 381 days suggests a focused, short-term need for these specific parts. 4. Awarded to a single, established defense contractor, indicating a reliance on existing supplier relationships. 5. The 'Other Aircraft Parts' classification points to a niche requirement within the broader aerospace sector. 6. The firm-fixed-price structure aims to transfer some cost risk to the contractor.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the lack of competitive bids. Without comparison to other offers or market rates for similar specialized aircraft parts, it's difficult to definitively assess if the $73.5 million represents a fair price. The sole-source nature means the government did not have the benefit of price discovery through a competitive process, potentially leading to a higher cost than if multiple vendors had vied for the contract.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning L3Harris Technologies was the only vendor considered. This approach bypasses the standard competitive bidding process, which typically involves multiple companies submitting proposals. The lack of competition limits the government's ability to negotiate the best possible price and terms, as there was no alternative supplier to compare against.

Taxpayer Impact: Taxpayers may have paid a premium for these aircraft parts due to the absence of competitive pressure. Without a bidding process, the government lacked leverage to secure the lowest possible price, potentially resulting in less efficient use of public funds.

Public Impact

The primary beneficiaries are likely the Department of the Air Force, receiving critical aircraft components. The services delivered involve the manufacturing or supply of specialized 'Other Aircraft Parts and Auxiliary Equipment'. The contract is geographically focused on Texas, where L3Harris Technologies is located. The contract supports the aerospace manufacturing workforce, particularly within L3Harris Technologies' operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Lack of transparency in the procurement process due to no-bid award.
Dependence on a single supplier could create future supply chain risks.
Limited opportunity for small businesses to participate in this specific contract.

Positive Signals

Firm-fixed-price contract shifts some cost risk to the contractor.
Award to an established contractor may ensure timely delivery of critical components.
Contract supports a specific, potentially unique, requirement for the Air Force.

Sector Analysis

The 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector is a specialized segment within the broader aerospace industry. This contract likely addresses a niche requirement for components that are not standard off-the-shelf items. The total market for aircraft parts is substantial, but this specific contract value of $73.5 million represents a focused procurement rather than a broad category spend. Comparable spending benchmarks are difficult to establish without more detail on the specific parts procured.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. The award to L3Harris Technologies, a large defense contractor, suggests that subcontracting opportunities for small businesses might exist, but these are not explicitly mandated or detailed in the provided data. The primary focus is on a large prime contractor, potentially limiting direct opportunities for small businesses to compete for the prime contract itself.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and financial management oversight structures. Given it's a sole-source award, the justification for this procurement method would be subject to review. Transparency is limited due to the lack of competition. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected during the contract's performance or award.

Related Government Programs

Department of Defense Aircraft Procurement
Air Force Logistics and Sustainment Contracts
Aerospace Component Manufacturing
Sole-Source Defense Procurements

Risk Flags

Sole-source award
Lack of competition
Potential for overpricing
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $73.5 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P.. IGF::CT::IGF ACAT III BIG SAFARI VIPSAM

Who is the contractor on this award?

The obligated recipient is L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P..

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 $73.5 million.

What is the period of performance?

Start: 2016-12-15. End: 2017-12-31.

What specific aircraft parts are being procured under this contract?

The provided data classifies the procurement under NAICS code 336413, 'Other Aircraft Parts and Auxiliary Equipment Manufacturing.' This suggests the contract is for specialized components that are not standard or mass-produced. Without further details or access to the contract's statement of work, the exact nature of these parts remains unspecified. They could range from unique structural elements to specialized electronic or mechanical sub-assemblies critical for specific aircraft platforms operated by the Department of the Air Force.

What was the justification for awarding this contract on a sole-source basis?

Sole-source awards are typically justified when only one responsible source is available or capable of meeting the government's needs. Common justifications include unique capabilities, proprietary technology, urgent and compelling needs where competition is impractical, or when a specific contractor is the only source for essential parts or services. For this contract, the justification would need to be documented by the Department of the Air Force, likely citing reasons such as unique manufacturing capabilities of L3Harris Technologies or the specialized nature of the required aircraft parts that only they can produce or supply within the necessary timeframe.

How does the $73.5 million contract value compare to historical spending on similar aircraft parts by the Air Force?

Direct comparison of the $73.5 million value to historical spending on 'similar' aircraft parts is difficult without knowing the exact specifications of the items procured. The 'Other Aircraft Parts' category is broad. However, $73.5 million is a substantial sum, indicating a significant procurement. Historical spending data for the Air Force shows large investments in aircraft sustainment and component manufacturing. To assess value, one would need to analyze past contracts for comparable specialized parts, considering factors like quantity, complexity, and technological requirements. The lack of competition here makes historical price benchmarking less reliable, as the government did not seek the most competitive price.

What are the potential risks associated with a sole-source award for critical aircraft components?

Sole-source awards for critical aircraft components carry several risks. Firstly, the absence of competition can lead to inflated prices, as the contractor faces no pressure to offer the lowest possible cost. Secondly, it can reduce transparency in the procurement process. Thirdly, it creates a dependency on a single supplier, which can be problematic if that supplier experiences production issues, financial instability, or decides to discontinue the product line. This dependency can also limit the government's flexibility in seeking alternative solutions or upgrades in the future. Finally, it may stifle innovation by preventing other capable companies from entering the market or contributing their expertise.

What is L3Harris Technologies' track record with the Department of the Air Force for similar contracts?

L3Harris Technologies is a major defense contractor with a significant history of working with the Department of the Air Force and other military branches. They have a broad portfolio encompassing aerospace, defense electronics, and communications systems. While specific details on their past performance for 'Other Aircraft Parts' under similar sole-source contracts would require deeper research into contract databases, their established presence suggests they possess the necessary capabilities and security clearances to handle such procurements. Past performance evaluations, if publicly available, would provide a more precise assessment of their reliability and quality in delivering similar goods or services.

Are there any performance metrics or oversight mechanisms specified for this contract?

The provided data does not detail specific performance metrics or oversight mechanisms for this contract. However, as a firm-fixed-price contract, the primary performance expectation is the delivery of the specified aircraft parts according to the contract's terms and schedule. Oversight would typically involve contract administration by the Air Force, including monitoring delivery schedules, quality control, and compliance with contract requirements. For sole-source contracts, especially those of significant value, there might be additional justification reviews and potentially higher levels of scrutiny from contracting officers and financial oversight bodies within the Department of Defense.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 10001 JACK FINNEY BLVD, GREENVILLE, TX, 75402

Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $77,319,539

Exercised Options: $75,446,785

Current Obligation: $73,510,752

Subaward Activity

Number of Subawards: 81

Total Subaward Amount: $29,671,564

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA862016G3027

IDV Type: BOA

Timeline