DoD Awards $36.8M for Aircraft Parts to L3Harris Technologies, Sole-Source

Contract Overview

Contract Amount: $36,853,488 ($36.9M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2018-02-27

End Date: 2019-03-31

Contract Duration: 397 days

Daily Burn Rate: $92.8K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Defense

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

Place of Performance

Location: GREENVILLE, HUNT County, TEXAS, 75402

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $36.9 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: IGF::CT::IGF ACAT III BIG SAFARI Key points: 1. Significant award to a single large contractor, L3Harris Technologies. 2. Sole-source procurement raises questions about price discovery and competition. 3. Contract duration of 397 days suggests a need for ongoing support. 4. Focus on 'Other Aircraft Parts' indicates a specialized, potentially critical, supply chain component.

Value Assessment

Rating: questionable

The contract value of $36.8M for 397 days is difficult to assess without specific unit details. The 'COST NO FEE' pricing structure can sometimes lead to less aggressive cost management by the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This method limits price discovery and may result in higher costs compared to a competitive process.

Taxpayer Impact: The lack of competition for this $36.8M contract means taxpayers may not have received the best possible price for these aircraft parts.

Public Impact

Impacts the operational readiness of Air Force aircraft requiring these specific parts. Potential for higher costs due to sole-source nature affects overall defense budget allocation. Highlights reliance on specific contractors for specialized aerospace components.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source procurement
Lack of competition
Cost-plus pricing structure (implied by 'COST NO FEE')

Positive Signals

Award to established contractor
Supports Department of Air Force operations

Sector Analysis

The aerospace and defense sector often involves complex, specialized components where sole-source contracts can occur due to unique technical requirements or limited suppliers. Benchmarks for 'Other Aircraft Parts' vary widely based on specificity.

Small Business Impact

This contract was awarded to L3Harris Technologies, a large business. There is no indication of small business participation in this specific award.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny to ensure fair pricing and justification for the lack of competition. Further review by oversight bodies may be necessary.

Related Government Programs

Other Aircraft Parts and Auxiliary Equipment Manufacturing
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Sole-source award lacks competitive pricing.
Potential for inflated costs due to limited competition.
Lack of transparency in price negotiation.
Dependency on a single contractor for critical parts.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $36.9 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P.. IGF::CT::IGF ACAT III BIG SAFARI

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 $36.9 million.

What is the period of performance?

Start: 2018-02-27. End: 2019-03-31.

What is the specific justification for awarding this contract on a sole-source basis, and what steps were taken to ensure fair pricing?

The justification for a sole-source award typically involves factors like unique capabilities, urgent needs, or lack of viable alternatives. Without access to the contract's justification documentation, it's impossible to detail the specific reasons. However, agencies are expected to conduct market research to confirm the lack of competition and negotiate the best possible price, even in sole-source situations, often through cost analysis and audits.

How does the 'COST NO FEE' pricing structure impact the contractor's incentive to control costs and ensure value for the government?

'COST NO FEE' contracts reimburse the contractor for allowable costs but do not provide a profit fee. This structure is intended to incentivize cost control by removing the profit motive tied to higher costs. However, it can sometimes lead to less aggressive cost management if the contractor anticipates full cost reimbursement without a direct profit penalty, potentially impacting overall value.

What is the potential long-term impact on the supply chain and future pricing if this type of specialized part is consistently procured sole-source?

Consistent sole-source procurement of specialized parts can stifle competition, potentially leading to higher prices over time as alternative suppliers are discouraged from entering the market. It also increases reliance on a single vendor, creating supply chain vulnerabilities. Over the long term, this can reduce innovation and limit the government's negotiating leverage.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc (UEI: 004203337)

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: $40,921,610

Exercised Options: $40,921,610

Current Obligation: $36,853,488

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $72,338

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA862016G3027

IDV Type: BOA

Timeline