DoD's $65M Northrop Grumman Sensor Contract: Engineering Services Lacking Competition
Contract Overview
Contract Amount: $65,056,379 ($65.1M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2017-06-01
End Date: 2027-05-31
Contract Duration: 3,651 days
Daily Burn Rate: $17.8K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: IGF::CT::IGF SENSOR SUSTAINMENT CONTRACT
Place of Performance
Location: AZUSA, LOS ANGELES County, CALIFORNIA, 91702
Plain-Language Summary
Department of Defense obligated $65.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: IGF::CT::IGF SENSOR SUSTAINMENT CONTRACT Key points: 1. Significant contract value of $65.06M awarded to Northrop Grumman. 2. Sole-source award raises concerns about price discovery and competition. 3. Long contract duration (2017-2027) with potential for cost overruns. 4. Engineering Services sector (NAICS 541330) often involves complex, specialized work.
Value Assessment
Rating: questionable
The contract's firm fixed price structure is positive, but the lack of competition makes it difficult to benchmark pricing effectively against similar contracts. Without competitive bids, there's a risk that the price may not reflect the best value achievable.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This significantly limits price discovery and potentially leads to higher costs for taxpayers as there is no market pressure to drive down prices.
Taxpayer Impact: The lack of competition on this $65M contract means taxpayers may be paying more than necessary for sensor sustainment services.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. Potential for reduced innovation and service quality without market competition. Lack of transparency in the procurement process raises accountability questions.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
Positive Signals
- Firm fixed price contract type
Sector Analysis
This contract falls within the Engineering Services sector, which is crucial for defense operations. Spending in this sector can vary widely, but competitive procurement is generally preferred to ensure value for money.
Small Business Impact
There is no indication that small businesses were involved in this sole-source award, suggesting a missed opportunity for small business participation.
Oversight & Accountability
The sole-source nature of this contract warrants closer oversight to ensure the contractor is delivering services at a fair and reasonable price and that the government's interests are protected.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competition
- Potential for inflated pricing
- Limited oversight visibility
- Missed small business opportunities
- Long-term sole-source dependency
Tags
engineering-services, department-of-defense, ca, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $65.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. IGF::CT::IGF SENSOR SUSTAINMENT CONTRACT
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 $65.1 million.
What is the period of performance?
Start: 2017-06-01. End: 2027-05-31.
What specific justifications were provided for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?
Sole-source awards are typically justified when only one responsible source can provide the required supplies or services. This often occurs due to unique capabilities, proprietary technology, or urgent needs. However, the government must rigorously explore if competition is truly impossible. Without detailed justification documents, it's difficult to assess if all avenues for competition were exhausted, potentially impacting the best value determination for taxpayers.
How is the performance of Northrop Grumman being monitored to ensure the $65M is being spent effectively and efficiently, given the lack of competition?
Effective performance monitoring is critical for sole-source contracts. This includes rigorous tracking of deliverables, adherence to schedules, and quality control. The Department of Defense should have robust contract management processes in place, including regular reviews and performance metrics, to ensure that Northrop Grumman is meeting all contractual obligations and that the funds are being used efficiently to achieve the intended mission outcomes.
What is the long-term strategy for sensor sustainment, and will future requirements be competed to ensure better value and foster innovation?
A clear long-term strategy is essential to avoid perpetual sole-source awards. The Department of the Air Force should be planning for future sensor sustainment needs, actively seeking opportunities to introduce competition. This could involve breaking down requirements into smaller, more manageable contracts, exploring new technologies, or encouraging new market entrants. Proactive planning and a commitment to competition in the future are key to maximizing taxpayer value and driving technological advancement.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
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: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 1100 W HOLLYVALE ST, AZUSA, CA, 91702
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: $163,074,561
Exercised Options: $65,268,275
Current Obligation: $65,056,379
Actual Outlays: $1,811,301
Subaward Activity
Number of Subawards: 144
Total Subaward Amount: $88,351,677
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2017-06-01
Current End Date: 2027-05-31
Potential End Date: 2027-05-31 00:00:00
Last Modified: 2025-11-25
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