DoD's $28M contract with Raytheon for computer services shows long-term engagement and potential for cost efficiencies

Contract Overview

Contract Amount: $28,067,899 ($28.1M)

Contractor: Raytheon Command & Control Solutions LLC

Awarding Agency: Department of Defense

Start Date: 2006-05-01

End Date: 2011-01-07

Contract Duration: 1,712 days

Daily Burn Rate: $16.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Place of Performance

Location: FULLERTON, ORANGE County, CALIFORNIA, 92833

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $28.1 million to RAYTHEON COMMAND & CONTROL SOLUTIONS LLC for work described as: Key points: 1. Contract duration of over 4 years suggests a sustained need for the services provided. 2. The firm-fixed-price structure aims to control costs and provide predictability for the government. 3. Sole-source award indicates a specific capability or relationship that may limit broader competition. 4. The contract's value, while significant, needs to be benchmarked against similar IT services for a full value assessment. 5. Focus on 'Other Computer Related Services' points to a specialized area within the IT sector. 6. The absence of small business set-asides warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: fair

The contract's value of $28 million over its duration is substantial. Without specific deliverables or performance metrics, a direct value-for-money assessment is challenging. However, the firm-fixed-price (FFP) type suggests an effort to lock in costs. Benchmarking against similar 'Other Computer Related Services' contracts awarded by the Department of Defense or other agencies would be necessary to determine if the pricing is competitive. The long duration (over 4 years) could indicate either a stable, ongoing need or a potential for cost overruns if not managed tightly.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Raytheon Command & Control Solutions LLC, was solicited. This typically occurs when a specific capability is required that only one contractor can provide, or in situations where a previous contract was highly successful and a sole-source extension is deemed most efficient. The lack of competition means there was no opportunity for price discovery through a bidding process, potentially leading to higher costs than if multiple vendors had competed.

Taxpayer Impact: Sole-source awards limit taxpayer benefit by foregoing competitive pricing. This means taxpayers may not be getting the best possible price for these computer services.

Public Impact

The primary beneficiary is the Department of Defense, which receives specialized computer-related services essential for its operations. The services delivered likely support critical command and control systems or related IT infrastructure. The geographic impact is centered around the agency's operational locations, potentially nationwide or specific bases. Workforce implications may include the need for specialized IT personnel within the DoD or reliance on contractor personnel with specific skill sets.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing, potentially increasing costs for taxpayers.
Lack of transparency in the justification for sole-source award.
Long contract duration without clear performance benchmarks raises concerns about sustained value.
Absence of small business participation noted, potentially limiting broader economic impact.

Positive Signals

Firm-fixed-price contract type helps control costs and provides budget certainty.
Long-term engagement suggests a stable and potentially effective working relationship.
Award to a known entity (Raytheon) may imply a level of trust and proven capability.

Sector Analysis

The 'Other Computer Related Services' category falls under the broader Information Technology (IT) sector. This sector is characterized by rapid innovation and a wide range of service providers, from large corporations to specialized small businesses. Federal spending in IT services is substantial, covering everything from software development and cybersecurity to cloud computing and IT support. Contracts like this, even if sole-source, are part of the government's ongoing effort to maintain and upgrade its technological infrastructure. Benchmarking against the average cost for similar IT services, considering the specific nature of 'command and control,' would provide better context.

Small Business Impact

This contract does not appear to have a small business set-aside, as indicated by 'sb': false. Furthermore, the 'ss' (small business subcontracting) field is also false. This suggests that there were no specific provisions made to ensure small business participation in this particular contract. While the prime contractor, Raytheon, is a large entity, the lack of set-asides or subcontracting goals means that opportunities for small businesses to engage in this specific procurement are limited. This could impact the broader small business ecosystem if such contracts represent a significant portion of federal IT spending.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contract management and oversight bodies, such as the Defense Contract Management Agency (DCMA), which is listed as the 'sa'. The firm-fixed-price nature of the contract provides a degree of cost control. However, the effectiveness of oversight depends on the rigor of performance monitoring, compliance checks, and any established reporting requirements. Transparency regarding the justification for the sole-source award and ongoing performance metrics would enhance accountability.

Related Government Programs

Department of Defense IT Services
Command and Control Systems Procurement
IT Services for National Security
Raytheon Government Contracts

Risk Flags

Sole-source award may limit price competition.
Lack of specified small business subcontracting goals.
Contract duration exceeds typical IT service periods without clear performance benchmarks.
Nature of 'Other Computer Related Services' requires detailed understanding for full value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $28.1 million to RAYTHEON COMMAND & CONTROL SOLUTIONS LLC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMMAND & CONTROL SOLUTIONS LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $28.1 million.

What is the period of performance?

Start: 2006-05-01. End: 2011-01-07.

What specific computer-related services were provided under this contract, and how do they align with the Department of Defense's mission needs?

The contract specifies 'Other Computer Related Services' (NAICS code 541519). While the exact nature of these services is not detailed in the provided data, this category typically encompasses a wide range of IT support, including IT consulting, systems integration, custom software development, and IT infrastructure management. For the Department of Defense, such services are crucial for maintaining and enhancing command and control (C2) systems, intelligence, surveillance, and reconnaissance (ISR) platforms, communication networks, and other critical defense IT infrastructure. The long duration and sole-source nature suggest these services are highly specialized and integral to specific DoD operations, potentially related to Raytheon's established expertise in defense systems.

How does the $28 million contract value compare to similar IT services contracts awarded by the DoD or other federal agencies?

A direct comparison of the $28 million contract value requires benchmarking against similar 'Other Computer Related Services' contracts (NAICS 541519) awarded over comparable periods. Given this contract's duration of over 4 years (1712 days), the annual value is approximately $6.5 million. Without knowing the specific scope of work, it's difficult to make a precise comparison. However, federal IT services contracts can range from hundreds of thousands to billions of dollars, depending on complexity and duration. The $6.5 million annual spend suggests a significant, ongoing requirement for specialized IT support. Further analysis would involve querying contract databases for similar services, considering factors like contract type (firm-fixed-price), agency, and specific service descriptions to assess if this represents a competitive or outlier price point.

What are the risks associated with a sole-source award for this type of IT service, and how might they be mitigated?

The primary risk of a sole-source award is the lack of competition, which can lead to inflated prices, reduced innovation, and a lack of vendor accountability. Taxpayers may not receive the best value for their money. Mitigation strategies include rigorous justification for the sole-source determination, ensuring the justification is based on unique capabilities or critical needs that cannot be met by other vendors. The government should also negotiate the best possible terms and pricing, potentially through strong negotiation tactics or by referencing market research. Furthermore, establishing clear performance metrics and robust oversight mechanisms can help ensure the contractor delivers quality services and that the government receives value, even without competitive pressure.

What is Raytheon Command & Control Solutions LLC's track record with the Department of Defense, particularly concerning contracts of this nature?

Raytheon Command & Control Solutions LLC, as part of the larger Raytheon Technologies (now RTX Corporation), has a long and extensive history of providing complex systems and services to the Department of Defense. Their expertise typically lies in areas such as aerospace, defense electronics, and integrated defense systems, which often involve sophisticated IT and command and control capabilities. While specific details on this particular contract's performance are not provided, Raytheon's general track record with the DoD is one of significant engagement across numerous high-value programs. Analyzing past performance reviews, contract awards, and any reported issues or successes related to similar IT services contracts awarded to Raytheon would provide a clearer picture of their reliability and effectiveness in this domain.

How has federal spending on 'Other Computer Related Services' evolved over time, and does this contract represent a typical spending pattern?

Federal spending on 'Other Computer Related Services' (NAICS 541519) has generally trended upwards over the past decade, reflecting the increasing reliance of government agencies on specialized IT support and consulting. This growth is driven by digital transformation initiatives, cybersecurity needs, and the modernization of legacy systems. A single $28 million contract awarded over four years, while substantial, represents one component of this broader spending trend. To determine if it's 'typical,' one would need to analyze the volume and average value of contracts within this NAICS code across the federal government. Factors like agency, duration, and specific service scope heavily influence individual contract values. This contract likely reflects a specific, long-term need within the DoD for specialized C2-related IT services.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

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: Raytheon Company (UEI: 001339159)

Address: 1801 HUGHES DR, FULLERTON, CA, 92833

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline