DoD's $49.3M BIG SAFARI contract awarded to L3Harris for aircraft parts, raising value concerns

Contract Overview

Contract Amount: $49,340,395 ($49.3M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2020-03-01

End Date: 2021-03-31

Contract Duration: 395 days

Daily Burn Rate: $124.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: BIG SAFARI

Place of Performance

Location: GREENVILLE, HUNT County, TEXAS, 75402

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $49.3 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: BIG SAFARI Key points: 1. The contract's value proposition is unclear due to a lack of competitive bidding. 2. Sole-source award limits price discovery and potentially inflates costs. 3. The fixed-price contract type offers some cost certainty but may not reflect true market value. 4. Performance duration of 395 days provides a limited timeframe for assessing long-term value. 5. The award falls within the 'Other Aircraft Parts' manufacturing sector, indicating specialized needs. 6. Lack of small business participation noted, with no set-aside or subcontracting requirements specified.

Value Assessment

Rating: questionable

Benchmarking the value of this $49.3 million contract is challenging due to its sole-source nature. Without competitive bids, it's difficult to ascertain if the price reflects fair market value or if taxpayers received optimal value for the aircraft parts and auxiliary equipment. The firm fixed-price structure provides cost certainty for the government, but the absence of competition means there was no market pressure to drive down costs. Further analysis would require comparing pricing to similar sole-source awards or internal cost estimates if available.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, L3Harris Technologies Integrated Systems L.P., was considered. This approach bypasses the standard competitive bidding process, which typically involves multiple companies vying for the contract. While sole-source awards can be justified for unique capabilities or urgent needs, they inherently limit price discovery and can lead to higher costs for the government compared to a fully competed contract.

Taxpayer Impact: The lack of competition means taxpayers may have paid a premium for these aircraft parts, as there was no market pressure to ensure the lowest possible price. This highlights a potential risk of inefficient use of public funds.

Public Impact

The primary beneficiaries are the Department of the Air Force, receiving critical aircraft parts. The contract supports the operational readiness and maintenance of Air Force aircraft. The geographic impact is concentrated in Texas, where L3Harris Technologies Integrated Systems L.P. is located. The contract supports jobs within L3Harris and its supply chain, contributing to the aerospace manufacturing workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially leading to higher costs.
Lack of transparency in the procurement process due to non-competitive nature.
Absence of small business participation may limit broader economic impact.
Firm fixed-price contract might not fully capture cost efficiencies if L3Harris's actual costs are lower.

Positive Signals

Award to an established contractor (L3Harris) suggests potential for reliable delivery.
Firm fixed-price contract provides budget certainty for the government.
Contract supports critical defense needs for the Air Force.

Sector Analysis

This contract falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector, a critical component of the broader aerospace and defense industry. This sector is characterized by high technological demands, stringent quality standards, and often involves complex supply chains. The total market size for aircraft parts manufacturing is substantial, driven by both military and commercial aviation needs. This specific award represents a portion of the Department of Defense's significant spending in maintaining and upgrading its aircraft fleet, a consistent area of federal investment.

Small Business Impact

This contract was not awarded as a small business set-aside, and there is no indication of subcontracting requirements for small businesses. This means that opportunities for small businesses to participate in this significant federal spending were likely limited. The absence of set-asides or subcontracting plans can reduce the overall economic benefit to the small business ecosystem within the aerospace sector.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's internal procurement regulations and contract management processes. The Air Force contracting office responsible for the award would monitor performance and compliance. Given the sole-source nature, there might be less public scrutiny compared to a competed contract. Transparency could be enhanced through detailed justifications for the sole-source award and post-award performance reporting.

Related Government Programs

Aircraft Maintenance and Repair
Aerospace Manufacturing
Defense Procurement
Supply Chain Management
Federal Aviation Administration (FAA) Regulations

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 $49.3 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P.. 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 $49.3 million.

What is the period of performance?

Start: 2020-03-01. End: 2021-03-31.

What is L3Harris Technologies Integrated Systems L.P.'s track record with the Department of Defense, particularly for similar aircraft parts contracts?

L3Harris Technologies Integrated Systems L.P. has a significant history of contracting with the Department of Defense across various platforms and services. For aircraft parts and auxiliary equipment, the company has been a frequent supplier, often involved in complex systems integration and manufacturing. Their track record generally indicates a capacity to deliver on defense contracts, though specific performance metrics for past contracts, such as on-time delivery rates, quality compliance, and cost performance, would require detailed review of individual contract histories. Analyzing past sole-source awards versus competed contracts awarded to L3Harris could also provide insight into their pricing strategies and the government's negotiation leverage in different procurement scenarios.

How does the $49.3 million contract value compare to similar sole-source awards for aircraft parts within the DoD?

Comparing this $49.3 million sole-source award to similar contracts is challenging without access to a comprehensive database of all DoD sole-source procurements for aircraft parts. However, based on general knowledge of defense spending, this amount is substantial, suggesting a significant quantity or high-value components are involved. Sole-source awards inherently lack the price transparency of competitive bids, making direct value-for-money comparisons difficult. To assess its comparability, one would ideally look for contracts with similar scope, complexity, and urgency, awarded under sole-source conditions to other major defense contractors. Without such data, it's presumed that the price was deemed acceptable by the procuring agency based on internal estimates or limited market research.

What are the primary risks associated with awarding a contract of this magnitude on a sole-source basis?

The primary risks associated with awarding a $49.3 million contract on a sole-source basis include potential overpayment due to lack of competition, reduced incentive for the contractor to innovate or offer cost efficiencies, and a lack of transparency in the procurement process. Taxpayers may not receive the best possible value for their money. Furthermore, sole-source awards can stifle competition in the long run by limiting market entry for other capable firms. There's also a risk that the government may not be aware of alternative solutions or suppliers that could be more cost-effective or technologically advanced. Ensuring the justification for the sole-source award is robust and well-documented is crucial to mitigate these risks.

What is the expected program effectiveness or outcome of this contract for the Air Force?

The expected program effectiveness of this $49.3 million contract is the timely and reliable provision of essential aircraft parts and auxiliary equipment to the Department of the Air Force. This ensures the continued operational readiness and maintenance capability of specific Air Force aircraft platforms. By securing these components, the Air Force can sustain its fleet, meet operational demands, and maintain air superiority. The effectiveness will ultimately be measured by the quality and availability of the parts delivered, their seamless integration into existing aircraft systems, and their contribution to overall mission accomplishment without significant delays or performance issues.

How does this contract's value and nature compare to historical spending patterns for aircraft parts by the Department of Defense?

The Department of Defense historically spends billions of dollars annually on aircraft parts and related services, reflecting the significant investment required to maintain a modern air fleet. A $49.3 million contract, while substantial for a single award, represents a fraction of the total annual spending in this category. The nature of this contract being sole-source is a deviation from the preferred competitive procurement strategy, which the DoD aims to maximize. However, sole-source awards do occur for specialized needs or when competition is deemed impractical. This contract's value is within the typical range for significant component procurements, but its sole-source nature warrants scrutiny against historical trends of competitive awards in the sector.

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: FIRM FIXED PRICE (J)

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: $49,340,395

Exercised Options: $49,340,395

Current Obligation: $49,340,395

Subaward Activity

Number of Subawards: 22

Total Subaward Amount: $6,398,065

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: FA862016G3027

IDV Type: BOA

Timeline