DoD's $28M radar sensor sustainment contract awarded to Northrop Grumman for PARCS software

Contract Overview

Contract Amount: $27,951,845 ($28.0M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2021-04-20

End Date: 2023-04-19

Contract Duration: 729 days

Daily Burn Rate: $38.3K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: SUSTAINMENT AND MODIFICATION OF RADAR SENSORS (SMORS)- AGILE PERIMETER ACQUISITION RADAR ATTACK CHARACTERIZATION SOFTWARE (PARCS) EFFORT II

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20171

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $28.0 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: SUSTAINMENT AND MODIFICATION OF RADAR SENSORS (SMORS)- AGILE PERIMETER ACQUISITION RADAR ATTACK CHARACTERIZATION SOFTWARE (PARCS) EFFORT II Key points: 1. Contract focuses on sustainment and modification of critical radar sensor systems. 2. The Agile Perimeter Acquisition Radar Attack Characterization Software (PARCS) effort is key to defense capabilities. 3. Northrop Grumman, a major defense contractor, holds this significant award. 4. The contract duration is 729 days, indicating a medium-term sustainment project. 5. Awarded under full and open competition, suggesting a competitive bidding process. 6. The contract type is Cost Plus Fixed Fee, which can introduce cost-overrun risks.

Value Assessment

Rating: fair

The contract value of $27.95 million for a 729-day period for radar sensor sustainment and software modification appears within a reasonable range for specialized defense engineering services. Benchmarking against similar sustainment contracts for complex radar systems is challenging without more specific details on the scope of work and the technology involved. However, the Cost Plus Fixed Fee (CPFF) contract type suggests that the government is bearing the cost risk, and the fixed fee component needs careful monitoring to ensure it remains appropriate for the services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which can lead to better pricing and innovation. The open competition suggests that the Department of the Air Force sought the best value from the market for the sustainment and modification of the PARCS software and associated radar sensors.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of receiving competitive pricing and ensures that the government is not limited to a single provider, potentially leading to cost savings.

Public Impact

The primary beneficiaries are the Department of Defense and the Air Force, ensuring the continued operational readiness of critical radar systems. Services delivered include sustainment and modification of radar sensors and PARCS software. The geographic impact is likely focused on the specific Air Force installations where these radar systems are deployed. Workforce implications include specialized engineering and technical roles required for radar system maintenance and software development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type can lead to cost overruns if not managed diligently, as the contractor is reimbursed for actual costs plus a fixed fee.
Lack of specific details on performance metrics makes it difficult to assess the contractor's track record and the effectiveness of the sustainment effort.
The specialized nature of radar sensor technology may limit the pool of qualified contractors, potentially impacting future competition.
Dependence on a single contractor for sustainment of critical systems can pose a long-term risk if not actively managed through market research and potential future competition.

Positive Signals

Awarded under full and open competition, indicating a robust bidding process and potential for competitive pricing.
Northrop Grumman is a well-established defense contractor with significant experience in aerospace and defense systems, suggesting a capable provider.
The contract addresses the sustainment of critical radar sensor systems, ensuring national security capabilities remain operational.
The contract duration of 729 days allows for a focused period of sustainment and modification, providing stability for the program.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting defense-related radar systems. The market for defense electronics sustainment is highly specialized, with a few large prime contractors dominating the landscape. Spending in this area is driven by the need to maintain aging but critical military hardware and adapt to evolving threats. Comparable spending benchmarks would typically involve other large-scale sustainment contracts for complex sensor arrays or weapon systems within the Department of Defense.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by `sb: false`. Furthermore, the prime contractor, Northrop Grumman Systems Corporation, is a large defense entity. While there is no direct set-aside, large prime contractors are often required to meet small business subcontracting goals. The extent to which small businesses will be involved as subcontractors on this specific contract is not detailed but is a common practice in the defense industry to foster participation.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Air Force contracting and program management offices. As a Cost Plus Fixed Fee contract, rigorous financial oversight is crucial to monitor incurred costs and ensure the fixed fee remains justified. Transparency is typically managed through contract reporting requirements and performance reviews. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Air Force Radar Modernization Programs
Ballistic Missile Defense System Support
Aerospace Defense Systems Sustainment
Northrop Grumman Defense Contracts

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage potential cost overruns.
Limited public information on specific performance metrics and bidder numbers.
Dependence on specialized technology may limit future competition.
Potential for scope creep in modification efforts under CPFF.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $28.0 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. SUSTAINMENT AND MODIFICATION OF RADAR SENSORS (SMORS)- AGILE PERIMETER ACQUISITION RADAR ATTACK CHARACTERIZATION SOFTWARE (PARCS) EFFORT II

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.

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 $28.0 million.

What is the period of performance?

Start: 2021-04-20. End: 2023-04-19.

What is the specific scope of 'sustainment and modification' for the PARCS software and radar sensors?

The 'sustainment and modification' scope for the PARCS (Perimeter Acquisition Radar Attack Characterization Software) effort likely encompasses a range of activities aimed at ensuring the continued operational effectiveness and relevance of the radar sensor systems. Sustainment typically involves maintenance, repair, and upkeep of the existing hardware and software to prevent degradation and ensure reliability. Modification could include software updates to address new threats, improve performance, integrate with other systems, or comply with evolving cybersecurity standards. Given the 'Agile Perimeter Acquisition Radar Attack Characterization Software' designation, the modifications might focus on enhancing the software's ability to characterize and track targets, potentially including advanced algorithms for threat identification and assessment. The Cost Plus Fixed Fee (CPFF) structure suggests that the contractor will be reimbursed for all allowable costs incurred in performing these tasks, plus a predetermined fixed fee representing profit.

How does the $27.95 million value compare to similar radar system sustainment contracts?

Directly comparing the $27.95 million value of this contract to similar radar system sustainment contracts is challenging without access to a comprehensive database of classified or proprietary defense procurements. However, for specialized, mission-critical systems like the PARCS radar, sustainment costs can be substantial due to the complexity of the technology, the need for highly skilled personnel, and the stringent performance requirements. Contracts for maintaining large-scale radar arrays or advanced sensor suites can range from tens to hundreds of millions of dollars over their lifecycle. The 729-day duration (approximately two years) suggests that this $27.95 million award represents a significant but not exceptionally large investment for a two-year sustainment period for such a critical defense asset. It is likely within the expected range for specialized engineering services supporting advanced military hardware.

What are the potential risks associated with the Cost Plus Fixed Fee (CPFF) contract type for this project?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract type for the sustainment and modification of radar sensors is the potential for cost overruns. Under a CPFF arrangement, the contractor is reimbursed for all allowable direct and indirect costs incurred in performing the work, plus a fixed fee. While the fee is fixed, the total cost to the government is not. If the contractor's costs exceed initial estimates, the government pays the actual costs. This can incentivize contractors to be less cost-conscious than in fixed-price contracts. Effective government oversight, including robust cost accounting and auditing, is critical to manage this risk. The government must ensure that all claimed costs are reasonable, allocable, and allowable according to the contract terms. Without diligent oversight, the total expenditure could exceed what might have been achieved under a more cost-certain contract type.

What is Northrop Grumman's track record with similar radar systems or defense software sustainment?

Northrop Grumman Systems Corporation is a major defense contractor with extensive experience in aerospace, defense electronics, and information systems. They have a long history of developing, manufacturing, and sustaining complex radar systems for various military platforms, including airborne, ground-based, and naval applications. Their portfolio includes advanced radar technologies for surveillance, targeting, and electronic warfare. Furthermore, Northrop Grumman is heavily involved in defense software development and sustainment, including command and control systems, mission planning software, and cybersecurity solutions. While specific details on their performance for the PARCS system under this particular contract are not publicly available, their established presence and broad capabilities in related fields suggest they possess the technical expertise and infrastructure necessary for this type of work. Past performance evaluations and contract awards would provide a more detailed picture of their track record.

How does this contract fit into the broader context of Air Force radar modernization and sustainment efforts?

This contract for the sustainment and modification of PARCS software and radar sensors fits into the broader Air Force strategy of maintaining and modernizing its critical surveillance and early warning capabilities. Radar systems are foundational to air defense, missile defense, and intelligence gathering. The Air Force operates a diverse array of radar systems, many of which are aging and require ongoing sustainment to remain effective against evolving threats. Simultaneously, modernization efforts aim to incorporate new technologies, improve performance, and ensure interoperability with newer systems. Contracts like this one, focusing on sustainment and 'agile' software updates, reflect a dual approach: keeping existing vital assets operational while allowing for incremental improvements to adapt to changing operational requirements and technological advancements. This ensures that the Air Force maintains a robust and responsive radar network.

Industry Classification

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

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 4807 STONECROFT BLVD, CHANTILLY, VA, 20151

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $27,951,845

Exercised Options: $27,951,845

Current Obligation: $27,951,845

Subaward Activity

Number of Subawards: 88

Total Subaward Amount: $10,668,564

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA872318D0001

IDV Type: IDC

Timeline