DoD's $51.6M L3Harris contract for engineering services awarded via sole-source justification

Contract Overview

Contract Amount: $51,645,559 ($51.6M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2022-12-01

End Date: 2024-11-30

Contract Duration: 730 days

Daily Burn Rate: $70.7K/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: ROCKWALL, ROCKWALL County, TEXAS, 75032

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $51.6 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 potential price overruns and limited market engagement. 2. Significant duration of 730 days suggests a long-term need for these engineering services. 3. The contract's value of over $51 million warrants close scrutiny of performance and cost-effectiveness. 4. Awarded by the Department of the Air Force, indicating a focus on aerospace and defense engineering needs. 5. The 'Engineering Services' NAICS code points to a broad range of technical support activities. 6. Lack of competition may limit opportunities for other capable firms and potentially higher innovation. 7. The contract type (Cost Plus Fixed Fee) can incentivize cost overruns if not managed tightly.

Value Assessment

Rating: questionable

Benchmarking the value of this $51.6 million contract is challenging without detailed task orders and performance metrics. However, the sole-source award and Cost Plus Fixed Fee structure inherently carry higher risk for value for money compared to competitively bid fixed-price contracts. The lack of transparency in pricing due to the sole-source nature makes it difficult to assess if the government is receiving a fair and reasonable price. Further analysis would require comparing specific deliverables and labor rates against industry standards for similar engineering services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning the Department of the Air Force did not conduct a competitive bidding process. This typically occurs when a specific contractor is deemed uniquely qualified or when circumstances prevent full and open competition. The absence of multiple bidders means that price discovery through market forces was bypassed, potentially leading to higher costs for the government. The justification for this sole-source award would need to be thoroughly reviewed to ensure it was appropriate.

Taxpayer Impact: Sole-source awards limit taxpayer value by preventing the government from leveraging competitive pressures to secure the best possible pricing and terms. This can result in higher overall spending for the same or lesser services.

Public Impact

The primary beneficiaries are likely the Department of the Air Force, receiving specialized engineering support critical for its operations. Services delivered encompass a broad spectrum of engineering expertise, potentially including design, analysis, testing, and integration. The geographic impact is centered in Texas, where L3Harris Technologies Integrated Systems L.P. is located, though the services may support broader Air Force initiatives. Workforce implications include the employment of skilled engineers and technical personnel by L3Harris, contributing to the defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potentially increases costs for taxpayers.
Cost Plus Fixed Fee contract type can incentivize cost escalation if not rigorously managed.
Lack of transparency in the justification for sole-source award raises concerns about procurement integrity.
Limited public information on specific deliverables makes it difficult to assess performance and value.
Long contract duration (730 days) requires sustained oversight to ensure continued relevance and efficiency.

Positive Signals

Award to a known entity, L3Harris Technologies, suggests a potentially established relationship and understanding of Air Force needs.
The contract addresses critical engineering services, indicating support for essential defense capabilities.
The fixed fee component of the contract provides some level of cost predictability for the government.
The contract is managed by the Department of the Air Force, a major defense entity with established procurement processes.

Sector Analysis

The engineering services sector within the defense industry is a critical component of national security, supporting the development, maintenance, and modernization of military platforms and systems. This contract falls within the broader professional, scientific, and technical services industry, which is a significant contributor to the U.S. economy. Spending in this sector is often driven by complex technological requirements and the need for specialized expertise that government agencies may not possess internally. Comparable spending benchmarks are difficult to establish without specific task order details, but large-scale engineering support contracts for defense agencies can range from tens to hundreds of millions of dollars.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss': false flag suggests it is not a small business prime award. This means that opportunities for small businesses would primarily be through subcontracting, if L3Harris chooses to engage them. The lack of a specific small business focus in the prime contract could limit direct opportunities for small businesses to participate in this significant federal spending.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Air Force contracting and program management offices. Accountability measures would be defined within the contract's terms and conditions, including performance standards and reporting requirements. Transparency is limited due to the sole-source nature and the proprietary information typically associated with engineering services. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's performance.

Related Government Programs

Defense Engineering Services
Aerospace Engineering Support
Military Technology Development
Department of Defense Procurement
Air Force Research and Development
L3Harris Technologies Contracts

Risk Flags

Sole Source Award
Cost Plus Fixed Fee Contract Type
Lack of Competition
Potential for Cost Overruns
Limited Transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $51.6 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 $51.6 million.

What is the period of performance?

Start: 2022-12-01. End: 2024-11-30.

What is the specific justification provided by the Department of the Air Force for awarding this contract on a sole-source basis?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are justified under specific circumstances outlined in the Federal Acquisition Regulation (FAR), such as when only one responsible source can provide the required supplies or services, or when there is a compelling urgency. Without the official justification document, it is impossible to assess the validity of the sole-source determination. This information is crucial for understanding why competition was precluded and whether it was in the government's best interest.

How does the Cost Plus Fixed Fee (CPFF) contract type potentially impact the final cost compared to other contract types?

A Cost Plus Fixed Fee (CPFF) contract type means the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. While the fee is fixed, the total cost to the government can vary significantly depending on the contractor's actual costs. This structure can incentivize contractors to incur higher costs, as their profit (the fixed fee) remains constant regardless of cost efficiency. This contrasts with fixed-price contracts, where the contractor bears the risk of cost overruns. For CPFF contracts, rigorous government oversight and cost controls are essential to manage potential cost escalation and ensure value for money.

What are the key performance indicators (KPIs) or deliverables expected under this 'Engineering Services' contract?

The provided data does not specify the key performance indicators (KPIs) or detailed deliverables for this 'Engineering Services' contract. These would typically be outlined in the Statement of Work (SOW) or Performance Work Statement (PWS) attached to the contract. For engineering services, KPIs could include metrics related to design accuracy, project completion timelines, adherence to technical specifications, successful testing outcomes, and innovation contributions. Without access to the SOW/PWS, it is difficult to assess the specific technical requirements and how contractor performance will be measured.

What is L3Harris Technologies Integrated Systems L.P.'s track record with the Department of Defense for similar engineering services?

L3Harris Technologies Integrated Systems L.P. is a major defense contractor with a substantial history of performing engineering and technical services for the Department of Defense. While specific details of their track record for contracts identical to this one are not provided, the company is known for its expertise in areas such as aerospace, communications, and electronic systems. Their past performance on similar large-scale defense contracts would be a key factor in the Air Force's decision-making, even in a sole-source context, to ensure capability and reliability. A review of their contract history, past performance evaluations, and any reported issues would provide further insight.

How does the $51.6 million contract value compare to historical spending on engineering services by the Department of the Air Force?

The $51.6 million contract value represents a significant investment in engineering services by the Department of the Air Force. To contextualize this, one would need to analyze historical spending patterns for similar engineering support contracts awarded by the Air Force over the past several fiscal years. This would involve looking at the average contract value, the number of contracts awarded, and the types of engineering services procured. Without this historical data, it's challenging to definitively state whether this contract is unusually large or typical for the Air Force's needs in this domain. However, given the sole-source nature, it suggests a specific, potentially critical, requirement.

What are the potential risks associated with a sole-source award for engineering services valued at over $51 million?

The primary risks associated with a sole-source award of this magnitude include: 1) Lack of Price Competition: The government may pay a higher price than if the contract were competed. 2) Limited Innovation: Without competitive pressure, the contractor may have less incentive to innovate or offer cost-saving solutions. 3) Contractor Lock-in: The government becomes dependent on a single provider, potentially limiting future flexibility. 4) Potential for Cost Overruns: Especially with CPFF, inadequate oversight can lead to costs exceeding initial estimates. 5) Reduced Transparency: Justification for sole-source awards can sometimes be opaque, raising concerns about fairness and best value.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

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

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: 1655 SCIENCE PL, ROCKWALL, TX, 75032

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

Financial Breakdown

Contract Ceiling: $57,234,951

Exercised Options: $57,234,951

Current Obligation: $51,645,559

Subaward Activity

Number of Subawards: 6

Total Subaward Amount: $1,854,452

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA862019G4006

IDV Type: BOA

Timeline