Raytheon Company awarded $29.9M for HTI Space Experiment, a research and development contract

Contract Overview

Contract Amount: $29,890,941 ($29.9M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2014-03-27

End Date: 2019-10-28

Contract Duration: 2,041 days

Daily Burn Rate: $14.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: IGF::OT::IGF HYPERTEMPORAL IMAGING (HTI) SPACE EXPERIMENT (SPX)

Place of Performance

Location: EL SEGUNDO, LOS ANGELES County, CALIFORNIA, 90245

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $29.9 million to RAYTHEON COMPANY for work described as: IGF::OT::IGF HYPERTEMPORAL IMAGING (HTI) SPACE EXPERIMENT (SPX) Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. Research and Development in Physical, Engineering, and Life Sciences is a key area for innovation. 3. The contract duration of 2041 days indicates a long-term project. 4. The award type is a Definitive Contract, typically used for fixed-price or cost-reimbursement requirements. 5. The contract was awarded by the Department of the Air Force, a major defense entity. 6. The North American Industry Classification System (NAICS) code 541712 points to R&D in physical sciences. 7. The contract's value is substantial for a single research endeavor.

Value Assessment

Rating: fair

Benchmarking the value of this specific R&D contract is challenging without more granular data on the scope and deliverables of the HTI Space Experiment. However, the total award of $29.9 million over approximately five years suggests a significant investment in specialized research. Comparing it to other R&D contracts within the Department of Defense or similar space-related projects would provide better context for its value-for-money assessment. The Cost Plus Fixed Fee (CPFF) pricing structure means that while the contractor's fee is fixed, the total cost can vary, introducing some cost risk for the government.

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 a bid. This approach is generally favored as it maximizes the pool of potential offerors and is expected to foster competitive pricing. The specific number of bidders is not provided, but the designation implies a robust competition was sought.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining the best value by encouraging multiple companies to offer their best pricing and technical solutions.

Public Impact

The primary beneficiaries are likely the Department of the Air Force and potentially other branches of the U.S. military, who will gain insights from the HTI Space Experiment. The services delivered are research and development focused on advanced imaging technologies in space. The geographic impact is primarily within the defense and space sectors, with potential applications extending to national security. Workforce implications include employment for scientists, engineers, and technicians involved in the research and development process.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contracts can lead to cost overruns if not closely managed, as the contractor is reimbursed for all allowable costs plus a fixed fee.
The long duration of the contract (2041 days) increases the risk of scope creep or changes in technological requirements over time.
The specific nature of 'space experiment' research can be inherently risky, with potential for technical challenges and unforeseen development hurdles.

Positive Signals

Awarded through full and open competition, which typically drives better pricing and innovation.
The contract is for research and development, indicating investment in future capabilities and technological advancement.
The contractor, Raytheon Company, is a well-established defense contractor with significant experience in aerospace and technology.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences. The aerospace and defense sub-sector is a significant area of government spending, with substantial investment in advanced technologies for national security and space exploration. Comparable spending benchmarks would involve looking at other large-scale R&D contracts awarded by the Department of Defense or NASA for space-related technologies and experimental platforms.

Small Business Impact

The provided data indicates that small business participation (sb) was false and there was no small business set-aside (ss). This suggests that the contract was not specifically targeted towards small businesses, and larger, established companies like Raytheon were the primary focus. Subcontracting opportunities for small businesses may exist, but they are not explicitly detailed in this summary. The impact on the small business ecosystem is likely minimal for this specific award, as it was competed broadly.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program management within the Department of the Air Force. The Cost Plus Fixed Fee structure necessitates diligent oversight of incurred costs to ensure they are allowable and reasonable. Transparency is generally maintained through contract reporting mechanisms, though specific details of the research might be classified or proprietary. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Space-based intelligence, surveillance, and reconnaissance (ISR) programs
Advanced sensor development contracts
Department of Defense research and development initiatives
Satellite technology development
National Reconnaissance Office (NRO) programs

Risk Flags

Long contract duration may increase risk of scope creep or obsolescence.
Cost Plus Fixed Fee structure requires diligent government oversight of costs.
Specific technical details of space experiments can be sensitive.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.9 million to RAYTHEON COMPANY. IGF::OT::IGF HYPERTEMPORAL IMAGING (HTI) SPACE EXPERIMENT (SPX)

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

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 $29.9 million.

What is the period of performance?

Start: 2014-03-27. End: 2019-10-28.

What specific technological advancements is the HTI Space Experiment aiming to achieve, and how do these align with current Air Force strategic objectives?

The 'HYPERTEMPORAL IMAGING (HTI) SPACE EXPERIMENT (SPX)' contract, awarded to Raytheon Company, likely aims to advance capabilities in space-based imaging. While specific technical details are often proprietary or classified for defense contracts, 'hypertemporal' suggests an emphasis on capturing images with extremely high temporal resolution, meaning rapid sequences of images over time. This could be crucial for tracking fast-moving objects, monitoring dynamic events, or improving the clarity of images affected by atmospheric or environmental changes. The alignment with Air Force strategic objectives would likely center on enhancing intelligence, surveillance, and reconnaissance (ISR) capabilities, improving situational awareness in contested environments, or supporting future space-based defense systems. Such advancements are critical for maintaining a technological edge in space operations and national security.

How does the Cost Plus Fixed Fee (CPFF) structure for this $29.9 million contract balance risk between the government and Raytheon Company?

The Cost Plus Fixed Fee (CPFF) contract structure for the HTI Space Experiment allocates risk in a specific manner. The government agrees to reimburse Raytheon Company for all allowable costs incurred during the performance of the contract. This means the government bears the primary risk associated with cost overruns if the project's expenses exceed initial estimates. However, Raytheon's profit is fixed in advance as a 'fee.' This fee does not increase even if costs rise. Consequently, Raytheon has an incentive to control costs to ensure their fixed fee represents a reasonable return on their investment, but they do not bear the direct financial risk of cost overruns. The government's risk is in the potential for higher-than-anticipated total project costs, while Raytheon's risk is primarily related to managing their operations efficiently to achieve their fixed profit margin.

Given the 2041-day duration, what mechanisms are in place to manage potential scope changes or technological obsolescence for the HTI Space Experiment?

Contracts with long durations, such as the 2041-day (approximately 5.6 years) term for the HTI Space Experiment, necessitate robust contract management to address potential scope changes and technological obsolescence. The Department of the Air Force would typically employ contract modification procedures, such as change orders or supplemental agreements, to formally adjust the contract's scope, schedule, or cost if requirements evolve. These modifications are usually negotiated and require justification. To mitigate technological obsolescence, program managers often incorporate periodic reviews and technology insertion points within the contract. This allows for the evaluation of emerging technologies and the potential integration of upgrades or alternative solutions if they offer significant advantages. Furthermore, the CPFF structure can provide some flexibility to adapt to evolving technical challenges, although significant deviations would still require formal negotiation and approval.

What is the historical spending pattern for Raytheon Company with the Department of the Air Force, particularly in R&D and space-related contracts?

Raytheon Company, now part of RTX, has a long and extensive history of contracting with the Department of the Air Force (and its predecessor entities) across a wide spectrum of defense needs, including significant investments in Research and Development (R&D) and space-related programs. Historically, Raytheon has been a prime contractor for numerous advanced technology development efforts, missile systems, radar technologies, and space-based platforms. Their R&D spending with the Air Force often involves developing next-generation capabilities in areas like electronic warfare, command and control, and advanced sensors. Given their established presence and expertise in aerospace and defense, contracts like the HTI Space Experiment are consistent with their historical portfolio. Analyzing specific historical spending data would reveal trends in contract types (e.g., CPFF vs. fixed-price), award values, and the specific R&D domains prioritized by the Air Force for Raytheon.

How does the 'Research and Development in the Physical, Engineering, and Life Sciences' NAICS code (541712) typically translate into contract deliverables for a space experiment?

The NAICS code 541712, 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology),' provides a broad classification for the scientific and technical work involved in the HTI Space Experiment. For a space experiment, deliverables under this code would likely not be a finished, deployable product in the traditional sense. Instead, they would focus on the research process and its outcomes. This could include: detailed research reports, theoretical models, experimental data analysis, simulation results, proof-of-concept demonstrations (potentially in laboratory settings or through simulations before space deployment), technical documentation, scientific publications (if unclassified), and potentially prototypes or test articles related to the imaging technology. The emphasis is on advancing scientific knowledge and engineering principles applicable to space-based imaging systems.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: BASIC RESEARCH

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 2000 E EL SEGUNDO BLVD, EL SEGUNDO, CA, 90245

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: $29,890,941

Exercised Options: $29,890,941

Current Obligation: $29,890,941

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $125,000

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline