DoD Awards $25M to Raytheon for CENTAUR II Baseline Sustainment

Contract Overview

Contract Amount: $25,071,974 ($25.1M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2019-07-26

End Date: 2023-05-09

Contract Duration: 1,383 days

Daily Burn Rate: $18.1K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: CENTAUR II - BASELINE SUSTAINMENT TO

Place of Performance

Location: RICHARDSON, COLLIN County, TEXAS, 75082

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $25.1 million to RAYTHEON COMPANY for work described as: CENTAUR II - BASELINE SUSTAINMENT TO Key points: 1. Contract awarded to Raytheon Company for $25.07M. 2. Service category is Custom Computer Programming Services (NAICS 541511). 3. Contract duration is 1383 days. 4. Awarded by the Department of Defense. 5. No small business participation noted.

Value Assessment

Rating: fair

The contract is a Cost Plus Fixed Fee type, which can lead to cost overruns if not managed carefully. The total award value is $25.07M over nearly four years.

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.

Taxpayer Impact: The lack of competition may result in a higher cost to taxpayers compared to a competitively bid contract.

Public Impact

Sustainment of critical defense systems ensures operational readiness. Long-term contracts can provide stability for contractors but may lack flexibility. Transparency in sole-source awards is crucial for public trust.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Cost-plus contract type
No small business participation

Positive Signals

Sustains critical defense capabilities
Long-term contract provides stability

Sector Analysis

This contract falls within the IT services sector, specifically custom computer programming. Defense IT spending is substantial, and sustainment contracts are common for maintaining complex systems.

Small Business Impact

The contract does not indicate any specific provisions or set-asides for small businesses. This suggests that the prime contractor, Raytheon, is expected to perform the majority of the work.

Oversight & Accountability

The Defense Contract Management Agency (DCMA) is responsible for overseeing this contract. The cost-plus fixed fee structure requires diligent oversight to manage costs and ensure value.

Related Government Programs

Custom Computer Programming Services
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Sole-source award limits competition.
Cost-plus contract type carries inherent cost escalation risk.
Lack of small business participation.
Long contract duration without clear performance metrics.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $25.1 million to RAYTHEON COMPANY. CENTAUR II - BASELINE SUSTAINMENT TO

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 $25.1 million.

What is the period of performance?

Start: 2019-07-26. End: 2023-05-09.

What specific sustainment activities are covered under this contract, and how do they contribute to the overall effectiveness of the CENTAUR II system?

This contract covers baseline sustainment for the CENTAUR II system, which likely includes maintenance, repair, and technical support to ensure the system's continued operational readiness. The specific activities are not detailed but are crucial for maintaining the system's functionality and performance in its intended defense applications.

Given the sole-source nature of this award, what mechanisms are in place to ensure Raytheon is providing services at a fair and reasonable price?

As a sole-source award, price reasonableness is typically assessed through contractor cost proposals, historical pricing data, and potentially independent government cost estimates. The Cost Plus Fixed Fee structure requires careful negotiation of the fixed fee and robust oversight of allowable costs to mitigate risks of inflated pricing.

What is the long-term strategy for CENTAUR II sustainment, and will future requirements be competed to ensure better value for taxpayer dollars?

The long-term strategy for CENTAUR II sustainment is not detailed in this award. However, given the sole-source nature of this baseline contract, it is advisable for the Department of Defense to plan for future competition of sustainment requirements to foster innovation and achieve better cost efficiencies for taxpayers.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1727 CITYLINE DR, RICHARDSON, TX, 75082

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: $26,541,603

Exercised Options: $25,181,633

Current Obligation: $25,071,974

Actual Outlays: $1,721,514

Subaward Activity

Number of Subawards: 7

Total Subaward Amount: $1,826,970

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA873018D0001

IDV Type: IDC

Timeline