DoD Awards Raytheon $226M for LRIP III Decoy and Jammer Assets, Lacking Competition
Contract Overview
Contract Amount: $225,989,291 ($226.0M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2010-05-05
End Date: 2028-01-15
Contract Duration: 6,464 days
Daily Burn Rate: $35.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: LRIP III 280 DECOY AND 20 JAMMER IOT&E ASSETS
Place of Performance
Location: TUCSON, PIMA County, ARIZONA, 85756
State: Arizona Government Spending
Plain-Language Summary
Department of Defense obligated $226.0 million to RAYTHEON COMPANY for work described as: LRIP III 280 DECOY AND 20 JAMMER IOT&E ASSETS Key points: 1. Significant investment in advanced defense technology. 2. Sole-source award raises concerns about price discovery and potential overspending. 3. Long contract duration (2010-2028) suggests a complex, evolving program. 4. Focus on guided missile and space vehicle manufacturing indicates a critical defense capability.
Value Assessment
Rating: questionable
The contract value of $225.99 million for LRIP III assets is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar defense procurements.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there is no market pressure to offer the best price.
Taxpayer Impact: The lack of competition on this large contract may result in taxpayers paying a premium for these defense assets.
Public Impact
Ensures continued availability of critical electronic warfare capabilities for the military. Supports advanced manufacturing and R&D within the defense industrial base. Potential for cost overruns due to the sole-source nature of the award.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- High contract value
- Long contract duration
- Potential for cost creep
Positive Signals
- Acquisition of critical defense technology
- Long-term program stability
Sector Analysis
This contract falls within the Guided Missile and Space Vehicle Manufacturing sector, a high-value area within defense. Spending benchmarks are difficult to establish due to the specialized nature and sole-source award.
Small Business Impact
The data indicates this is a large prime contract awarded to Raytheon Company. There is no information provided regarding subcontracting opportunities for small businesses.
Oversight & Accountability
The contract is managed by the Defense Contract Management Agency (DCMA), which provides oversight. However, the sole-source nature limits the effectiveness of competitive oversight in driving down costs.
Related Government Programs
- Guided Missile and Space Vehicle Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award limits price competition.
- High contract value increases financial risk.
- Long contract duration (over 17 years) may lead to cost overruns.
- Lack of transparency on specific technology or justification for sole-source.
- Potential for contractor lock-in.
Tags
guided-missile-and-space-vehicle-manufac, department-of-defense, az, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $226.0 million to RAYTHEON COMPANY. LRIP III 280 DECOY AND 20 JAMMER IOT&E ASSETS
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $226.0 million.
What is the period of performance?
Start: 2010-05-05. End: 2028-01-15.
What is the justification for awarding this contract sole-source, and what measures are in place to ensure cost-effectiveness?
The justification for a sole-source award typically involves unique capabilities or proprietary technology. To ensure cost-effectiveness, the agency should employ robust negotiation strategies, independent cost estimates, and potentially require detailed cost breakdowns from the contractor. Regular performance reviews and audits are also crucial.
What are the specific risks associated with a sole-source contract of this magnitude and duration?
The primary risks include inflated pricing due to the absence of competition, potential for scope creep without market checks, and contractor complacency. There's also a risk that technological advancements from competitors are not incorporated, leading to a less optimal solution over time. Contractor performance issues can be harder to address without alternative options.
How does the acquisition of these LRIP III assets contribute to the overall effectiveness of Department of Defense operations?
LRIP (Low Rate Initial Production) assets are crucial for testing and validating new systems before full-scale production. Decoy and jammer assets are vital for electronic warfare, protecting friendly forces and disrupting enemy systems. Their acquisition ensures the DoD maintains a technological edge in contested electromagnetic spectrum environments, enhancing mission success and survivability.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
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: RTX Corp (UEI: 001344142)
Address: 1151 E HERMANS RD, TUCSON, AZ, 85756
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $226,115,251
Exercised Options: $226,115,251
Current Obligation: $225,989,291
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2010-05-05
Current End Date: 2028-01-15
Potential End Date: 2028-01-15 00:00:00
Last Modified: 2022-02-03
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