DoD's $239M Big Safari contract awarded to L3Harris for aircraft parts, with a significant portion spent in Texas

Contract Overview

Contract Amount: $23,944,639 ($23.9M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2022-08-23

End Date: 2025-12-31

Contract Duration: 1,226 days

Daily Burn Rate: $19.5K/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: GREENVILLE, HUNT County, TEXAS, 75402

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $23.9 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: BIG SAFARI Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, which can lead to cost overruns if not managed carefully. 2. The contract was not competed, raising questions about potential price efficiencies and value for money. 3. A substantial portion of the contract value is associated with Texas, indicating a concentrated geographic impact. 4. The duration of the contract (1226 days) suggests a long-term need for these aircraft parts and services. 5. The specific nature of 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' points to a specialized niche within the defense industrial base.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its 'not competed' status and the specialized nature of the goods/services. The cost-plus-fixed-fee structure requires close oversight to ensure costs remain reasonable and that the fixed fee is appropriate for the effort involved. Without competitive bids, it's difficult to definitively assess if the pricing reflects market rates or represents a good value for the taxpayer.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competition from other potential suppliers. This can occur for various reasons, such as unique capabilities, urgent needs, or lack of viable alternatives. However, it limits the government's ability to leverage competitive pressures to drive down costs and ensure the best possible pricing.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as the government may not benefit from the price reductions typically achieved through competitive bidding processes.

Public Impact

The Department of the Air Force is the primary beneficiary, receiving critical aircraft parts and auxiliary equipment. This contract supports the operational readiness and maintenance of Air Force aircraft fleets. The contract has a significant geographic impact, with substantial spending allocated to Texas. It likely supports jobs within the aerospace manufacturing sector, particularly in Texas, contributing to the local and regional economy.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in higher prices than could be achieved through a competitive process.
Cost-plus-fixed-fee contracts require robust oversight to prevent cost escalation and ensure fair pricing.
The specialized nature of the parts could create dependency on a single supplier, posing a risk if that supplier faces issues.

Positive Signals

Award to an established contractor (L3Harris) suggests a level of confidence in their capability to deliver.
The contract supports critical defense needs, contributing to national security objectives.
The long contract duration indicates a stable, ongoing requirement, potentially allowing for efficient production planning.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts and auxiliary equipment. This is a highly specialized and technologically advanced industry. The total federal spending in this sector is substantial, driven by the significant investments made by the Department of Defense in maintaining and modernizing its vast fleet of aircraft. L3Harris is a major player in this market, known for its advanced technological solutions and manufacturing capabilities.

Small Business Impact

There is no indication that this contract included small business set-asides or subcontracting requirements. As a sole-source award to a large prime contractor, the direct impact on small businesses is likely minimal unless L3Harris voluntarily engages them in its supply chain. Further analysis would be needed to determine if subcontracting opportunities exist and if small businesses are being utilized.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. Given the cost-plus-fixed-fee structure, rigorous financial oversight and performance monitoring are crucial to ensure compliance with contract terms and to manage costs effectively. Transparency may be limited due to the sole-source nature, but contract performance reports and audits would be key accountability measures.

Related Government Programs

Aircraft Maintenance and Repair
Aerospace Manufacturing
Defense Logistics
Air Force Procurement
Specialized Aircraft Components

Risk Flags

Sole-source award
Cost-plus-fixed-fee contract type
Potential for cost overruns
Lack of competitive pricing validation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.9 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 $23.9 million.

What is the period of performance?

Start: 2022-08-23. End: 2025-12-31.

What is L3Harris Technologies' track record with similar sole-source defense contracts?

L3Harris Technologies, a significant defense contractor, has a history of receiving both competed and sole-source awards across various defense programs. Analyzing their past performance on sole-source contracts, particularly those involving aircraft parts or specialized manufacturing, would reveal their ability to manage costs, meet delivery schedules, and maintain quality under such arrangements. Past performance reviews and contract close-out data from the Federal Procurement Data System (FPDS) or similar databases would be essential to assess their reliability and efficiency in non-competitive scenarios. Understanding their historical pricing structures and profit margins on similar sole-source awards could also provide context for the current contract's value.

How does the cost-plus-fixed-fee structure typically perform in long-duration defense contracts?

Cost-plus-fixed-fee (CPFF) contracts are often used when the scope of work is not precisely defined or when there is a high degree of uncertainty, as may be the case with specialized aircraft parts. In long-duration contracts, CPFF can provide flexibility for the contractor to adapt to evolving requirements. However, it also places a significant burden on the government to meticulously track and audit costs to prevent overruns. The 'fixed fee' component is intended to incentivize efficiency, but without strong oversight, the contractor may have less motivation to control costs aggressively. Historically, CPFF contracts have a reputation for being susceptible to cost growth, making robust government oversight and clear performance metrics critical for successful execution and value for taxpayer money.

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

The primary risk of a sole-source award for a contract valued at $239 million is the potential for inflated pricing due to the absence of competitive pressure. Without competing bids, the government cannot be certain it is receiving the best possible price for the goods or services. This can lead to inefficient use of taxpayer funds. Additionally, sole-source awards can stifle innovation by limiting opportunities for new or smaller companies to enter the market and offer alternative solutions. There's also a risk of contractor complacency, where the lack of competition might reduce the incentive for the awarded contractor to continuously improve processes or offer cost-saving measures. Ensuring fair and reasonable pricing through rigorous negotiation and cost analysis becomes paramount.

What is the typical market size and competitive landscape for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' for the DoD?

The market for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' for the Department of Defense is substantial, encompassing a wide array of components, systems, and support equipment necessary for maintaining and operating military aircraft. This sector is characterized by high barriers to entry, including stringent quality control requirements, specialized manufacturing processes, and extensive security clearances. While there are numerous small and medium-sized manufacturers, the prime contracting space often involves larger, established aerospace companies like L3Harris, which possess the scale, expertise, and security infrastructure to handle complex DoD requirements. The competitive landscape can vary significantly depending on the specific type of part; some components may have a limited number of qualified suppliers, leading to less intense competition, while others might be more broadly available.

How does spending in Texas for defense contracts compare to other states for similar types of equipment?

Texas consistently ranks among the top states for federal defense contract spending, driven by its significant military installations, robust aerospace industry, and large defense manufacturing base. Spending on aircraft parts and related equipment in Texas is likely substantial, reflecting the presence of major defense contractors and associated supply chains. Comparing this specific contract's allocation to Texas with national averages or spending patterns in other states with similar industrial capabilities (e.g., California, Washington, Florida) would provide context. However, without detailed breakdowns of spending by state for specific PSC codes or contract types across the entire DoD, a precise comparative analysis is difficult. Generally, states with strong aerospace and manufacturing sectors tend to attract a larger share of such contracts.

Industry Classification

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

Product/Service Code: COMM/DETECT/COHERENT RADIATION

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: 10001 JACK FINNEY BLVD, GREENVILLE, TX, 75402

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $23,944,639

Exercised Options: $23,944,639

Current Obligation: $23,944,639

Subaward Activity

Number of Subawards: 26

Total Subaward Amount: $11,380,397

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA862021G4027

IDV Type: BOA

Timeline