DoD's $26.2M L3Harris Contract for Aircraft Parts: A Sole-Source Award with Long-Term Delivery

Contract Overview

Contract Amount: $26,238,933 ($26.2M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2022-06-30

End Date: 2025-05-31

Contract Duration: 1,066 days

Daily Burn Rate: $24.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: BIG SAFARI

Place of Performance

Location: WACO, MCLENNAN County, TEXAS, 76705

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $26.2 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: BIG SAFARI Key points: 1. Contract awarded on a sole-source basis, raising questions about price discovery and potential value for money. 2. The contract spans over two years, indicating a need for sustained support for aircraft parts. 3. Awarded by the Department of the Air Force, suggesting a focus on aviation readiness and sustainment. 4. The contractor, L3Harris Technologies, is a significant player in the defense sector, implying established capabilities. 5. The 'Other Aircraft Parts' classification points to a broad range of potential components and services. 6. The contract's duration and sole-source nature warrant scrutiny for potential cost efficiencies and competitive alternatives.

Value Assessment

Rating: questionable

Benchmarking the value of this $26.2 million contract is challenging due to its sole-source nature and the specific nature of 'Other Aircraft Parts'. Without competitive bids, it's difficult to assess if the pricing reflects market rates or if L3Harris Technologies provided the most cost-effective solution. The Cost Plus Fixed Fee (CPFF) contract type can sometimes lead to higher costs if not managed diligently, as the contractor is reimbursed for allowable costs plus a fixed fee. Further analysis would require detailed cost breakdowns and comparisons to similar sole-source awards for comparable parts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This typically occurs when only one vendor possesses the necessary capabilities, technology, or proprietary information to fulfill the requirement. The lack of competition means taxpayers did not benefit from the price reductions that can arise from a competitive bidding process. It also limits the opportunity to explore innovative solutions from a wider range of suppliers.

Taxpayer Impact: The absence of competition for this $26.2 million contract means taxpayers may not have received the best possible price. It also suggests a reliance on a single provider, potentially limiting future flexibility and cost-saving opportunities.

Public Impact

The primary beneficiaries are the Department of the Air Force and its aviation operations, ensuring the availability of necessary aircraft parts. The contract supports the sustainment and operational readiness of Air Force aircraft fleets. The geographic impact is primarily within Texas, where L3Harris Technologies Integrated Systems L.P. is located, potentially supporting local jobs and the regional economy. Workforce implications include the potential for continued employment and specialized roles within L3Harris for manufacturing, engineering, and logistics related to aircraft parts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential value for money.
Cost Plus Fixed Fee contract type can incentivize higher costs if not closely monitored.
Lack of transparency in the procurement process due to sole-source nature.
Potential for vendor lock-in if alternative suppliers are not explored.
The broad category of 'Other Aircraft Parts' could obscure specific cost drivers.

Positive Signals

Contract awarded to a known defense contractor (L3Harris Technologies) with established capabilities.
Long-term contract (over two years) provides stability for supply chain and operations.
Supports critical Department of Defense aviation requirements.
Potential for specialized expertise and quality assurance from an experienced provider.

Sector Analysis

The aerospace and defense sector is characterized by high technological complexity, stringent quality requirements, and significant government investment. This contract for aircraft parts falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' industry. The market for defense aerospace components is often dominated by a few large, specialized contractors like L3Harris Technologies due to the high barriers to entry, including R&D costs, regulatory compliance, and established relationships with government agencies. Spending in this area is critical for maintaining military readiness and operational capabilities.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses indicated in the provided data. The sole-source nature further reduces the likelihood of small business participation unless they are direct subcontractors to L3Harris. This contract does not appear to actively promote small business engagement within the federal contracting ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. Given it's a Cost Plus Fixed Fee contract, rigorous oversight of allowable costs and the fixed fee is crucial to ensure fair pricing. The Defense Contract Audit Agency (DCAA) may also play a role in auditing costs. Transparency is limited due to the sole-source nature, but contract performance reviews and milestone tracking would be key accountability measures. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Aircraft Parts Manufacturing
Defense Logistics Support
Air Force Sustainment Programs
Aerospace Component Production
Sole-Source Defense Contracts

Risk Flags

Sole-source award raises concerns about competition and potential overpricing.
CPFF contract type shifts cost overrun risk to the government.
Lack of specific details on 'Other Aircraft Parts' hinders granular cost analysis.
Potential for limited small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.2 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 $26.2 million.

What is the period of performance?

Start: 2022-06-30. End: 2025-05-31.

What is the specific nature of the 'Other Aircraft Parts' being procured under this contract?

The provided data categorizes this contract under 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' (NAICS code 336413). This broad classification suggests the procurement could encompass a wide array of components, from structural elements and engine parts to specialized electronic or hydraulic systems, or even auxiliary equipment not fitting into more specific manufacturing categories. Without further details on the specific line items or Statement of Work, it is difficult to pinpoint the exact nature of the parts. This ambiguity can make it challenging to benchmark costs effectively or assess the criticality of each component to the overall aircraft mission readiness.

Why was this contract awarded on a sole-source basis, and what alternatives were considered?

The data indicates this contract was 'NOT COMPETED,' signifying a sole-source award. Typically, sole-source awards are justified when only one responsible source is available or capable of meeting the government's needs. Reasons can include unique technical capabilities, proprietary technology, urgent and compelling needs where competition is impractical, or specific follow-on work to an existing system where only the original manufacturer can provide compatible parts. The specific justification for this $26.2 million award to L3Harris Technologies is not detailed in the provided data. A thorough review would require access to the Justification and Approval (J&A) document, which outlines the rationale and any market research conducted to ensure no other viable sources existed.

How does the Cost Plus Fixed Fee (CPFF) contract type impact the overall cost and risk for the government?

The Cost Plus Fixed Fee (CPFF) contract type means the contractor, L3Harris Technologies, will be reimbursed for all allowable costs incurred in performing the contract, plus a predetermined fixed fee representing profit. While the fixed fee provides some cost certainty for the contractor's profit margin, the government bears the risk of cost overruns if actual costs exceed estimates. This structure can incentivize contractors to control costs to some extent, as their fee is fixed, but it also requires robust government oversight to ensure costs are reasonable and allocable. Compared to fixed-price contracts, CPFF can be less cost-effective for the government if not managed diligently, especially for procurements where the scope of work is well-defined.

What is L3Harris Technologies' track record with similar sole-source contracts for aircraft parts within the Department of Defense?

L3Harris Technologies is a major defense contractor with extensive experience in aerospace and defense systems. While the provided data does not detail their specific track record with sole-source contracts for aircraft parts, their position as a large, established entity suggests a history of fulfilling complex defense requirements. Analyzing past performance on similar sole-source awards would involve reviewing contract databases for previous awards, performance evaluations (e.g., CPARS), and any documented issues or successes. Understanding their history with sole-source procurements can provide insights into their reliability, cost management, and ability to deliver quality products under such conditions.

What is the historical spending trend for 'Other Aircraft Parts' by the Department of the Air Force, and how does this contract compare?

The provided data offers a snapshot of a single contract award ($26.2 million) for 'Other Aircraft Parts' to L3Harris Technologies. To understand historical spending trends, one would need to analyze aggregated spending data for the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' (336413) NAICS code, specifically for the Department of the Air Force, over several fiscal years. This would involve querying federal procurement databases (like FPDS or SAM.gov) to identify the total dollar value of contracts awarded in this category, the number of contracts, and the primary awardees. Comparing this $26.2 million award to historical averages and trends would reveal whether this represents a significant increase, decrease, or typical level of spending for these types of parts.

Industry Classification

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

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

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: 7500 MAEHR RD, WACO, TX, 76705

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: $26,238,933

Exercised Options: $26,238,933

Current Obligation: $26,238,933

Subaward Activity

Number of Subawards: 16

Total Subaward Amount: $1,833,435

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA862020G4050

IDV Type: BOA

Timeline