DoD awards Raytheon Company $97.4M for advanced tactical application program, engineering services

Contract Overview

Contract Amount: $97,370,627 ($97.4M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2019-06-24

End Date: 2024-03-31

Contract Duration: 1,742 days

Daily Burn Rate: $55.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: CET 19-945, KURFS ADVANCED TACTICAL APPLICATION TO NEGATE ATTENUATION PROGRAM.

Place of Performance

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

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $97.4 million to RAYTHEON COMPANY for work described as: CET 19-945, KURFS ADVANCED TACTICAL APPLICATION TO NEGATE ATTENUATION PROGRAM. Key points: 1. Contract value of $97.4M for engineering services indicates significant investment in advanced tactical applications. 2. The contract was awarded using full and open competition, suggesting a robust bidding process. 3. The cost-plus-fixed-fee (CPFF) contract type may present cost control challenges if not closely managed. 4. The duration of 1742 days (approx. 4.7 years) suggests a long-term, complex project. 5. The contract is managed by the Defense Contract Management Agency, indicating a focus on defense-related needs. 6. The North American Industry Classification System (NAICS) code 541330 points to engineering services, a critical component of defense technology development.

Value Assessment

Rating: fair

The contract value of $97.4M for engineering services is substantial. Without specific benchmarks for similar advanced tactical application programs, it's difficult to definitively assess value for money. The CPFF structure, while allowing for flexibility, can lead to higher costs if not managed with stringent oversight to control expenditures and ensure efficiency. Benchmarking against other large-scale defense engineering contracts would be necessary for a more precise evaluation of pricing and value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit a bid. This typically fosters a competitive environment, which can lead to better pricing and innovation. The number of bidders is not specified, but the use of full and open competition suggests that multiple entities likely vied for this significant contract, promoting price discovery.

Taxpayer Impact: Taxpayers benefit from full and open competition as it generally drives down costs and encourages the government to seek the best possible value by leveraging a wider pool of potential contractors.

Public Impact

The primary beneficiaries are the Department of Defense, which will receive advanced tactical application capabilities. The services delivered are engineering-focused, likely involving research, development, design, and testing of new technologies. The geographic impact is primarily within the United States, with potential implications for defense installations and operations. Workforce implications include employment for engineers, technicians, and support staff at Raytheon Company and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contract type can lead to cost overruns if not managed diligently.
The long contract duration may introduce risks related to technological obsolescence or shifting program priorities.
Lack of specific performance metrics or outcome data makes it challenging to assess the program's ultimate effectiveness.
The substantial contract value requires robust oversight to ensure efficient use of taxpayer funds.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that likely yielded fair pricing.
Raytheon Company is a major defense contractor with extensive experience in complex engineering projects.
The contract addresses advanced tactical applications, indicating investment in critical national security capabilities.
The program duration suggests a commitment to developing and integrating sophisticated technology.

Sector Analysis

The defense engineering services sector is characterized by high barriers to entry, significant R&D investment, and long development cycles. Contracts like this are crucial for maintaining technological superiority. Spending in this area is often driven by evolving geopolitical threats and the need for advanced military capabilities. Comparable spending benchmarks would typically involve other large-scale R&D and engineering contracts awarded by the DoD to major defense primes for complex systems development.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). While large prime contractors like Raytheon often utilize small business subcontractors, the direct award to a large entity means direct opportunities for small businesses are limited to subcontracting roles. The impact on the small business ecosystem depends on Raytheon's subcontracting plan and its ability to effectively integrate smaller, innovative firms into its supply chain.

Oversight & Accountability

Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Accountability measures would include adherence to contract terms, delivery schedules, and quality standards. Transparency is facilitated through contract award databases, but detailed program performance data may be restricted due to national security considerations. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse.

Related Government Programs

Advanced Weapons Systems Development
Tactical Communication Systems
Aerospace Engineering Services
Defense Research and Development
Military Technology Integration

Risk Flags

Cost Overrun Risk (CPFF)
Technological Obsolescence Risk (Long Duration)
Performance Measurement Difficulty (Engineering Services)
Scope Creep Potential (Complex R&D)

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $97.4 million to RAYTHEON COMPANY. CET 19-945, KURFS ADVANCED TACTICAL APPLICATION TO NEGATE ATTENUATION PROGRAM.

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 $97.4 million.

What is the period of performance?

Start: 2019-06-24. End: 2024-03-31.

What is Raytheon Company's track record with similar Department of Defense contracts?

Raytheon Company, now part of RTX, has a long and extensive history of contracting with the Department of Defense across a wide array of programs, including missile systems, radar technology, cybersecurity, and aerospace. They are a major defense prime contractor, consistently awarded large-value contracts for research, development, production, and sustainment of military systems. Their track record includes both successes and challenges, as is common with large, complex defense projects. Specific performance on past contracts, including adherence to schedule, budget, and technical requirements, can be found in various government contract databases and performance reports, though detailed information on every contract is not always publicly available.

How does the $97.4M contract value compare to similar advanced tactical application programs?

Benchmarking the $97.4M contract value for 'CET 19-945, KURFS ADVANCED TACTICAL APPLICATION TO NEGATE ATTENUATION PROGRAM' against similar programs is challenging without access to proprietary program details and specific cost breakdowns. However, $97.4M is a significant investment, indicative of a complex, long-term development or sustainment effort within the defense sector. Large-scale engineering and R&D contracts for advanced military applications often range from tens of millions to billions of dollars, depending on the scope, technology maturity, and duration. This particular award falls within the mid-to-high range for a specific program phase or system development, suggesting a substantial undertaking.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract type for this program?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract type for this advanced tactical application program is the potential for cost overruns. In a CPFF structure, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. While the fixed fee incentivizes the contractor to control costs to maximize profit, there's less direct incentive to minimize costs compared to fixed-price contracts. If the contractor's costs exceed estimates significantly, the government bears the burden of these increased expenses. Effective oversight, detailed cost tracking, and robust auditing by the contracting agency are crucial to mitigate these risks and ensure the government receives good value.

What does the contract duration of 1742 days imply about the program's complexity and goals?

A contract duration of 1742 days, approximately 4.7 years, strongly implies that the 'KURFS ADVANCED TACTICAL APPLICATION TO NEGATE ATTENUATION PROGRAM' is a complex, long-term endeavor. Such durations are typical for research and development, system design, integration, testing, and initial fielding phases of advanced military technologies. It suggests that the program is not a simple procurement but involves significant engineering effort, potentially iterative development cycles, and a need for sustained support. This extended timeline also introduces risks related to technological evolution, changing operational requirements, and potential budget fluctuations over the program's life.

How does the 'Engineering Services' classification (NAICS 541330) shape our understanding of this contract's purpose?

The classification under NAICS code 541330, 'Engineering Services,' clarifies that this contract is primarily for the application of engineering principles and knowledge to the design, development, and implementation of systems or processes. For the 'KURFS ADVANCED TACTICAL APPLICATION' program, this means the focus is on the technical and scientific expertise required to create or enhance tactical applications, likely involving complex problem-solving, analysis, design, and testing. It distinguishes this award from contracts focused purely on manufacturing, procurement of off-the-shelf items, or basic maintenance, highlighting the R&D and specialized technical support aspects of the program.

What is the significance of the contract being awarded by the Department of Defense (DoD) and managed by DCMA?

The awarding agency, the Department of Defense (DoD), signifies that this contract directly supports national defense objectives and military readiness. The management by the Defense Contract Management Agency (DCMA) indicates that the contract involves complex technical requirements, production oversight, and performance monitoring critical to military applications. DCMA's role ensures that the contractor, Raytheon Company, meets the stringent quality, schedule, and cost requirements necessary for defense systems, providing a layer of specialized oversight tailored to the unique demands of military procurement and program execution.

Industry Classification

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

Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HQ072715R0001

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rockwell Collins Australia PTY Limited

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: $97,370,627

Exercised Options: $97,370,627

Current Obligation: $97,370,627

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HQ072716D0006

IDV Type: IDC

Timeline