DoD's $28.4M L3Harris contract for aircraft parts lacked competition, raising value concerns

Contract Overview

Contract Amount: $28,416,623 ($28.4M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2018-10-15

End Date: 2019-10-31

Contract Duration: 381 days

Daily Burn Rate: $74.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Defense

Official Description: IGF::OT::IGF BIG SAFARI

Place of Performance

Location: GREENVILLE, HUNT County, TEXAS, 75402

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $28.4 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: IGF::OT::IGF BIG SAFARI Key points: 1. The contract was awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. Performance occurred over a short period, suggesting a focused need rather than a broad program. 3. The absence of competition is a key risk indicator for potential overpayment. 4. The contractor, L3Harris Technologies, is a major defense supplier, indicating established capabilities. 5. The contract falls under 'Other Aircraft Parts and Auxiliary Equipment Manufacturing,' a critical but broad category. 6. The contract's value, while significant, is moderate within the context of large defense procurements.

Value Assessment

Rating: questionable

Given the sole-source award, a direct comparison to similar contracts is difficult without more data on the specific parts and services. However, the lack of competition inherently raises questions about whether the government achieved the best possible price. Without a competitive bidding process, it's harder to benchmark the value against market rates or alternative suppliers. The fixed-price nature of the award (implied by the lack of cost-plus details) is generally positive for cost control, but the absence of competition undermines the potential for significant savings.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, L3Harris Technologies Integrated Systems L.P., was solicited. This typically occurs when a unique capability is required, or when it's deemed not in the government's best interest to compete. The lack of multiple bidders means there was no direct price comparison or negotiation leverage derived from a competitive environment. This can lead to higher prices than might be achieved through open competition.

Taxpayer Impact: Taxpayers may have paid a premium for these aircraft parts due to the absence of competitive bidding. Without competing offers, the government had limited ability to negotiate the lowest possible price, potentially resulting in less efficient use of public funds.

Public Impact

The Department of the Air Force benefits from the acquisition of necessary aircraft parts. This contract supports the operational readiness and maintenance of Air Force aircraft. The primary beneficiaries are the military personnel and units relying on these aircraft. The contract's geographic impact is localized to where the parts are delivered and utilized, likely within Air Force operational bases. Workforce implications are primarily within L3Harris Technologies, supporting their manufacturing and supply chain operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potential savings.
Lack of competition raises concerns about value for money.
Short contract duration might indicate a specific, urgent need rather than strategic sourcing.

Positive Signals

Awarded to a known, established defense contractor (L3Harris Technologies).
Contract type (implied fixed-price) generally favors cost certainty for the government.
Specific part numbers and auxiliary equipment suggest a defined requirement.

Sector Analysis

This contract falls within the broader aerospace and defense manufacturing sector, specifically focusing on aircraft parts and auxiliary equipment. The market for these components is often characterized by specialized suppliers, long lead times, and stringent quality requirements. While large defense contractors like L3Harris dominate, there is also a segment of smaller, specialized manufacturers. Spending in this area is critical for maintaining military readiness and technological superiority, with significant government investment annually.

Small Business Impact

This contract does not appear to have involved small business set-asides, as it was awarded sole-source to L3Harris Technologies. There is no indication of subcontracting plans specifically targeting small businesses within the provided data. Therefore, the direct impact on the small business ecosystem for this particular award is likely minimal, with no explicit mechanism to foster small business participation.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and program management offices. The Inspector General's office within the Department of Defense may also conduct audits or investigations into contract performance and pricing, particularly given the sole-source nature. Transparency is limited by the lack of competitive bidding, but contract award data is publicly available through systems like FPDS.

Related Government Programs

Aircraft Maintenance and Repair
Aerospace Manufacturing
Defense Logistics
Air Force Procurement
Sole-Source Defense Contracts

Risk Flags

Sole-source award
Lack of competition
Potential for overpayment
Limited transparency on pricing justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $28.4 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P.. IGF::OT::IGF 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 $28.4 million.

What is the period of performance?

Start: 2018-10-15. End: 2019-10-31.

What specific aircraft parts or auxiliary equipment were procured under this contract?

The provided data indicates the contract falls under NAICS code 336413, 'Other Aircraft Parts and Auxiliary Equipment Manufacturing.' While the specific itemized list of parts is not detailed in the summary data, this classification suggests components such as engine parts, landing gear, avionics components, or other specialized equipment necessary for aircraft operation and maintenance. The 'Auxiliary Equipment' aspect could encompass items like ground support equipment, specialized tools, or non-flight critical systems integral to aircraft functionality.

Why was this contract awarded on a sole-source basis instead of being competed?

Sole-source awards are typically justified when only one responsible source can provide the required supplies or services. Common reasons include unique technical capabilities, proprietary technology, urgent and compelling needs where competition is not feasible, or when it's deemed not in the government's best interest to solicit offers from multiple sources. Without specific justification documentation for this IGF::OT::IGF BIG SAFARI contract, it is presumed that L3Harris Technologies possessed a unique capability or proprietary information that precluded competition at the time of award.

What is L3Harris Technologies' track record with the Department of Defense?

L3Harris Technologies is a major defense contractor with a substantial history of providing a wide range of products and services to the Department of Defense (DoD) and other government agencies. Their portfolio includes aerospace systems, communications, electronic warfare, and information technology solutions. The company has a long-standing relationship with the DoD, frequently securing large contracts for complex systems and components. Their track record generally indicates significant experience and capability in meeting defense requirements, though like any large contractor, specific contract performance can vary.

How does the $28.4 million contract value compare to typical spending in this category?

The $28.4 million contract value is a significant sum, but within the context of overall Department of Defense spending on aircraft parts and manufacturing (NAICS 336413), it represents a moderate-sized award. The DoD procures billions of dollars worth of aerospace components annually. While this specific contract is substantial for a single award, it is not exceptionally large compared to major platform procurements or extensive sustainment contracts. Its significance is amplified by the sole-source nature, which limits the ability to benchmark its value against competitive offerings.

What are the potential risks associated with a sole-source award of this magnitude?

The primary risk associated with a sole-source award of $28.4 million is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, the government may overpay for the goods or services received. Other risks include reduced innovation, as there's less incentive for the sole provider to develop cost-saving efficiencies, and potential vendor lock-in, making future procurements from the same vendor more difficult to negotiate down. There's also a risk that the government's specific needs might not be met as optimally as they could be through a competitive process that explores various solutions.

What oversight mechanisms were in place for this contract?

Oversight for this contract would have been managed by the contracting activity within the Department of the Air Force. This typically involves contract administration, monitoring performance against delivery schedules and quality standards, and ensuring compliance with contract terms. Given the sole-source nature, the focus of oversight might lean more towards ensuring the necessity of the sole-source justification and verifying that the contractor is meeting the agreed-upon specifications and delivery timelines. The DoD Inspector General's office could also conduct audits or investigations into the contract's execution and pricing.

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

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: $28,725,501

Exercised Options: $28,725,501

Current Obligation: $28,416,623

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