Air Force's $26.4M contract for King Air 350ER support awarded to L3Harris Technologies

Contract Overview

Contract Amount: $26,426,897 ($26.4M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2018-10-05

End Date: 2019-09-30

Contract Duration: 360 days

Daily Burn Rate: $73.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ROYAL SAUDI AIR FORCE KING AIR 350ER

Place of Performance

Location: GREENVILLE, HUNT County, TEXAS, 75402

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $26.4 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: ROYAL SAUDI AIR FORCE KING AIR 350ER Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, indicating potential for cost overruns. 2. Limited competition raises concerns about price discovery and potential overpayment. 3. Contract duration of 360 days suggests a focused scope of work. 4. Awarded to a single contractor, L3Harris Technologies, limiting market engagement. 5. The contract falls under 'All Other Support Services,' a broad category. 6. Texas is the place of performance, potentially benefiting the local economy.

Value Assessment

Rating: fair

The contract's value of $26.4 million for support services is difficult to benchmark without more specific details on the services rendered. The cost-plus-fixed-fee structure inherently carries more risk for the government compared to fixed-price contracts, as actual costs can exceed initial estimates. Without comparable contracts for similar King Air 350ER support, assessing value for money is challenging. The absence of a clear benchmark for per-unit costs further complicates a precise value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a sole-source justification, meaning it was not competed openly. This approach is typically used when only one responsible source can provide the required services. The lack of competition means that the government did not benefit from a range of proposals and potentially lower prices that could have resulted from a competitive bidding process. This limits the government's ability to ensure it received the best possible pricing and terms.

Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the most competitive pricing, as the government did not leverage market competition to drive down costs.

Public Impact

The Royal Saudi Air Force is the ultimate beneficiary of the support services provided. The contract supports the operational readiness and maintenance of King Air 350ER aircraft. Services are performed in Texas, potentially creating or sustaining jobs in that region. The contract ensures the continued functionality of critical aviation assets for a foreign partner.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing benefits for taxpayers.
Cost-plus-fixed-fee contract structure introduces potential for cost escalation.
Broad service category ('All Other Support Services') may obscure specific cost drivers.

Positive Signals

Contract awarded to a known entity, L3Harris Technologies, suggesting established capabilities.
Specific aircraft type (King Air 350ER) indicates a focused and potentially specialized support need.
Performance location in Texas may align with existing logistical or operational footprints.

Sector Analysis

This contract falls within the broader aerospace and defense support services sector. The market for specialized aircraft maintenance and support is significant, driven by government and military needs for operational readiness. L3Harris Technologies is a major player in this space, providing a range of defense and aerospace solutions. Benchmarking this contract's value is challenging without detailed service breakdowns, but it represents a portion of the overall spending on specialized aviation support.

Small Business Impact

The data indicates 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 award to a large prime contractor like L3Harris Technologies suggests that the primary focus was on capability rather than small business participation. This contract is unlikely to have a direct positive impact on the small business ecosystem within this specific procurement.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and financial management oversight mechanisms. The Inspector General's office may conduct audits or investigations into cost-plus-fixed-fee contracts to ensure compliance and prevent fraud. Transparency is limited due to the sole-source nature and the broad service category, making detailed public scrutiny challenging without further disclosure of service specifics and cost breakdowns.

Related Government Programs

Foreign Military Sales (FMS) support contracts
Aircraft maintenance and repair services
Defense contractor support services
Aerospace technology support

Risk Flags

Sole-source award limits price competition.
Cost-plus-fixed-fee contract increases government financial risk.
Broad service category may obscure specific cost drivers and performance metrics.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.4 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P.. ROYAL SAUDI AIR FORCE KING AIR 350ER

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 $26.4 million.

What is the period of performance?

Start: 2018-10-05. End: 2019-09-30.

What specific support services are included under this contract for the King Air 350ER?

The provided data categorizes this contract under 'All Other Support Services' (NAICS 561990) and does not specify the exact nature of the support for the Royal Saudi Air Force's King Air 350ER aircraft. This broad classification could encompass a wide range of activities, such as logistics, maintenance, training, technical support, or program management. Without a more detailed statement of work or service description, it is impossible to ascertain the precise services rendered. This lack of specificity makes it difficult to assess the contract's value, risks, and performance context accurately.

How does the cost-plus-fixed-fee (CPFF) pricing structure impact the government's financial risk?

A Cost-Plus-Fixed-Fee (CPFF) contract structure means the government reimburses the contractor for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure shifts a significant portion of the financial risk to the government. If the contractor's costs exceed estimates, the government is obligated to pay those higher costs. While the fee is fixed, the total contract value can fluctuate considerably based on actual expenses. This contrasts with fixed-price contracts, where the contractor bears the risk of cost overruns. For CPFF contracts, robust oversight and detailed cost accounting are crucial to manage potential cost escalations and ensure fair pricing.

What is the typical track record of L3Harris Technologies in providing similar support services?

L3Harris Technologies is a well-established defense contractor with a broad portfolio of services, including aerospace systems, communications, and electronic systems. They have a significant history of supporting various military aircraft platforms, both domestically and internationally, often through complex government contracts. While specific performance metrics for this particular contract are not detailed here, L3Harris generally possesses the technical expertise and infrastructure required for aircraft support. However, like any large contractor, their performance can vary across different contracts and programs, and a comprehensive assessment would require reviewing their specific performance history on similar foreign military sales or aircraft support agreements.

Are there any comparable contracts for King Air 350ER support that can be used for benchmarking?

Benchmarking this specific contract is challenging without more granular data. The King Air 350ER is a versatile aircraft used for various roles, including surveillance and transport, by different entities. Comparable contracts would ideally involve similar support services (e.g., maintenance, logistics, training) for the same aircraft type, performed under similar conditions (e.g., foreign military sales, specific operational environments). Publicly available contract databases often lack the detailed service descriptions needed for precise comparisons. However, general market rates for aviation support services, adjusted for aircraft type and complexity, can provide a rough benchmark. The sole-source nature of this award further complicates direct comparison, as competitive bids often reveal a wider range of pricing.

What are the potential implications of the 'All Other Support Services' classification on contract oversight?

The classification 'All Other Support Services' (NAICS 561990) is very broad and can encompass a wide array of activities, making specific oversight more challenging. This broadness can obscure the exact nature of the services being procured, potentially hindering detailed performance monitoring and cost analysis. Effective oversight requires a clear understanding of deliverables, performance metrics, and cost drivers. When a contract falls under such a general category, contracting officers and oversight bodies must rely heavily on the contractor's internal reporting and detailed invoices, necessitating robust auditing procedures to ensure that the services provided align with the contract's intent and that costs are reasonable and allowable.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Other Support Services › All Other Support Services

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

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

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: $38,645,234

Exercised Options: $38,645,234

Current Obligation: $26,426,897

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline