DoD's $19.3M Big Safari contract awarded to L3Harris for aircraft parts, raising value concerns

Contract Overview

Contract Amount: $19,327,198 ($19.3M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2025-05-23

End Date: 2027-05-22

Contract Duration: 729 days

Daily Burn Rate: $26.5K/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: WACO, MCLENNAN County, TEXAS, 76705

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $19.3 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. 2. Lack of competition for this significant award warrants scrutiny of price reasonableness. 3. The contract duration of 729 days suggests a substantial and ongoing need. 4. Awarded by the Department of the Air Force, indicating a focus on aviation readiness. 5. The North American Industry Classification System (NAICS) code 336413 points to specialized aircraft parts manufacturing. 6. The contract's value is substantial within its specific manufacturing sub-sector.

Value Assessment

Rating: questionable

The contract's cost-plus-fixed-fee structure, combined with a lack of competition, raises questions about value for money. Without competitive bids, it is difficult to benchmark the pricing against market rates or similar contracts. The fixed fee component provides some cost control, but the overall cost is subject to the actual expenses incurred by the contractor. Further analysis would be needed to compare the estimated costs against industry standards for similar aircraft parts and services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning there was no open competition. This significantly limits the government's ability to solicit multiple bids and negotiate the best possible price. The lack of competition could result in higher costs for taxpayers as there is less incentive for the contractor to offer competitive pricing. The specific justification for the sole-source award would need to be examined to understand why other vendors were not considered.

Taxpayer Impact: Sole-source awards can lead to higher prices for taxpayers due to the absence of competitive pressure to reduce costs.

Public Impact

The primary beneficiaries are likely entities within the Department of Defense, specifically the Air Force, receiving critical aircraft parts. The services delivered involve the manufacturing and supply of specialized aircraft parts, crucial for maintaining aviation capabilities. The geographic impact is centered in Texas, where L3Harris Technologies Integrated Systems L.P. is located, suggesting a concentration of economic activity and potential job support in that region. Workforce implications may include skilled labor in aerospace manufacturing and engineering within L3Harris and its potential supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially increases costs for taxpayers.
Cost-plus-fixed-fee contract type can incentivize higher spending if not closely monitored.
Lack of transparency in the justification for sole-source award.
Potential for cost overruns due to the nature of cost-reimbursement contracts.
Limited visibility into the contractor's cost structure without competitive bidding.

Positive Signals

Award to an established contractor, L3Harris Technologies, suggests potential for reliable delivery.
Fixed fee component provides some level of cost predictability for the government.
Contract supports critical defense needs for the Air Force.
Specific NAICS code indicates specialized manufacturing capabilities are being utilized.

Sector Analysis

The aerospace manufacturing sector is highly specialized and capital-intensive, with significant barriers to entry. Contracts like this, for specialized aircraft parts, are crucial for maintaining the operational readiness of military aviation fleets. The value of this contract, while substantial, needs to be benchmarked against the overall spending in defense aviation procurement and the specific market for these types of components. The 'Big Safari' program itself is known for rapidly developing and fielding advanced capabilities, often through specialized, sometimes sole-source, awards.

Small Business Impact

This contract does not appear to have a small business set-aside (SB is false). There is no explicit indication of subcontracting plans for small businesses within the provided data. Without specific set-aside requirements or mandated subcontracting goals, the direct impact on the small business ecosystem for this particular award is likely minimal, unless L3Harris voluntarily engages small businesses in its supply chain.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. Accountability measures are inherent in the cost-plus-fixed-fee structure, requiring the contractor to justify incurred costs. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Air Force Aircraft Procurement
Defense Logistics Agency (DLA) Aviation
Other Aircraft Parts and Auxiliary Equipment Manufacturing
Big Safari Program

Risk Flags

Sole-source award
Cost-plus-fixed-fee contract type
Lack of competitive bidding
Potential for cost overruns
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.3 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 $19.3 million.

What is the period of performance?

Start: 2025-05-23. End: 2027-05-22.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was 'NOT COMPETED,' implying a sole-source award. The specific justification for this sole-source determination is not included in the data. Typically, sole-source awards are justified under specific circumstances outlined in federal acquisition regulations, such as when only one responsible source can provide the required supplies or services, or in cases of urgent and compelling need. Without the official justification document, it is impossible to ascertain the precise reasons. This lack of competition is a key area for further investigation, as it limits price discovery and potentially increases costs for the government.

How does the cost-plus-fixed-fee (CPFF) structure compare to other contract types for similar defense procurements?

Cost-plus-fixed-fee (CPFF) contracts are often used when the scope of work is not precisely defined or when there is significant uncertainty in the costs involved, such as in research and development or complex manufacturing. In this case, the fixed fee provides the contractor with a predetermined profit margin. However, CPFF contracts place the cost risk primarily on the government, as the contractor is reimbursed for all allowable costs. Compared to fixed-price contracts, CPFF can lead to higher overall costs for the government if not managed diligently. For routine procurements of well-defined aircraft parts, fixed-price contracts are generally preferred for better cost control. The use of CPFF here suggests a level of complexity or uncertainty in the 'Big Safari' program's requirements.

What is L3Harris Technologies' track record with similar sole-source, CPFF contracts with the Department of Defense?

L3Harris Technologies Integrated Systems L.P. is a major defense contractor with extensive experience across various contract types, including sole-source and cost-plus-fixed-fee arrangements. While specific details on their track record with sole-source CPFF contracts for 'Big Safari' or similar aircraft parts are not provided in this data snippet, the company's size and position in the industry suggest they have managed numerous such agreements. A deeper dive into historical contract awards and performance reviews for L3Harris would be necessary to assess their performance, cost control, and adherence to schedules on comparable sole-source CPFF contracts. Past performance is a critical factor in assessing the risk associated with awarding contracts, especially sole-source ones.

What are the potential risks associated with the 729-day duration of this contract?

A contract duration of 729 days (approximately two years) for specialized aircraft parts presents several potential risks. Firstly, it implies a long-term dependency on a single supplier, especially given the sole-source nature. This can reduce flexibility if requirements change or if a more cost-effective solution emerges. Secondly, over such a period, the risk of cost escalation due to inflation, material price fluctuations, or unforeseen technical challenges increases. The CPFF structure means the government bears these cost risks. Lastly, a long duration can sometimes indicate a lack of urgency or a poorly defined initial requirement, potentially leading to inefficiencies or delays if not actively managed.

How does this contract's value compare to other spending within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector?

The contract value of $19.3 million falls within the typical range for specialized manufacturing contracts within the defense sector. However, without broader market data on the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' (NAICS 336413) sector, it's challenging to provide a precise benchmark. This sector includes a wide array of components, from simple fasteners to complex avionics. The 'Big Safari' program often deals with unique or rapidly developed systems, which can command higher prices due to R&D and specialized production. To assess value, this contract's price would need to be compared against similar 'Big Safari' awards or other sole-source procurements for highly specialized, low-volume aircraft components, rather than general market averages.

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 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: $19,327,198

Exercised Options: $19,327,198

Current Obligation: $19,327,198

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $439,955

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: FA862020G4050

IDV Type: BOA

Timeline