Raytheon's $213M R&D contract for TRIPLE TARGET TERMINATOR (T3) program awarded by DoD

Contract Overview

Contract Amount: $21,347,342 ($21.3M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2010-10-22

End Date: 2012-04-30

Contract Duration: 556 days

Daily Burn Rate: $38.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: TRIPLE TARGET TERMINATOR (T3) PROGRAM

Place of Performance

Location: TUCSON, PIMA County, ARIZONA, 85756

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $21.3 million to RAYTHEON COMPANY for work described as: TRIPLE TARGET TERMINATOR (T3) PROGRAM Key points: 1. Contract awarded via full and open competition after exclusion of sources, indicating a competitive process. 2. Research and Development in Physical, Engineering, and Life Sciences sector, focusing on advanced technologies. 3. Contract duration of 556 days suggests a focused, medium-term research initiative. 4. Awarded as a Definitive Contract, implying a clear scope and terms. 5. The Cost Plus Fixed Fee (CPFF) pricing structure allows for flexibility in R&D but requires careful oversight. 6. Small business set-aside was not utilized, suggesting the primary contractor was selected based on capabilities.

Value Assessment

Rating: fair

The contract's value of $213.47 million for a 556-day R&D effort requires careful benchmarking against similar advanced technology development projects. Without specific deliverables or performance metrics, assessing value for money is challenging. The CPFF structure, while common in R&D, can lead to cost overruns if not managed tightly. The base award amount of $38.39 million suggests an initial phase, with potential for growth.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which implies that while the competition was open, certain sources may have been excluded based on specific criteria. The number of bids received is not specified, but the designation suggests a competitive process was intended. This approach aims to ensure a broad range of potential offerors are considered while potentially focusing on specialized capabilities.

Taxpayer Impact: This competitive approach is generally favorable for taxpayers as it encourages multiple companies to bid, potentially driving down costs and improving the quality of proposals received.

Public Impact

The primary beneficiary is the Department of Defense, specifically the Air Force, which will receive advanced research and development outputs. The contract supports the development of technologies related to the TRIPLE TARGET TERMINATOR (T3) program, likely enhancing defense capabilities. The contract is geographically focused in Arizona, potentially stimulating the local economy and workforce in that region. This R&D effort may lead to advancements that require a skilled scientific and engineering workforce, indirectly impacting job creation in specialized fields.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contracts can incentivize contractors to increase costs to maximize profit if not adequately monitored.
The exclusion of sources in a 'full and open' competition needs further clarification to ensure no qualified small businesses were unfairly excluded.
The specific nature of the 'TRIPLE TARGET TERMINATOR (T3) PROGRAM' is not detailed, making it difficult to assess the true scope and potential risks of the R&D.
Limited information on performance metrics makes it hard to gauge the effectiveness and efficiency of the research being conducted.

Positive Signals

Awarded through a competitive process ('Full and Open Competition After Exclusion of Sources'), suggesting a deliberate effort to find the best value.
The contract is for Research and Development, indicating investment in future technological capabilities for national defense.
The contractor, Raytheon Company, is a major defense contractor with a significant track record in R&D and advanced systems.
The contract is managed by the Department of the Air Force, a branch with extensive experience in overseeing complex R&D programs.

Sector Analysis

This contract falls within the Research and Development sector, specifically NAICS code 541712 (Research and Development in the Physical, Engineering, and Life Sciences). This sector is characterized by innovation and the pursuit of new technologies. Comparable spending in this area can vary widely depending on the specific technological focus, but significant government investment is typical for defense-related R&D. The market is often dominated by large, specialized defense contractors like Raytheon.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. This suggests that the primary focus was on securing the specialized R&D capabilities of a large, established contractor. The absence of small business involvement might limit opportunities for smaller innovative firms to participate directly in this specific project, though they may be involved in the broader defense supply chain.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Air Force, with specific contracting officers and program managers responsible for monitoring progress, costs, and adherence to the contract terms. Given the R&D nature and CPFF structure, rigorous oversight of expenditures and technical milestones is crucial. Transparency may be limited due to the sensitive nature of defense research, but internal reporting and audits would be standard accountability measures.

Related Government Programs

Advanced Weapons Systems Development
Missile Defense Research
Aerospace Technology Research
Department of Defense Research and Development Programs
Air Force Science and Technology Investments

Risk Flags

Potential for cost overruns due to CPFF structure.
Uncertainty in R&D outcomes and technological obsolescence.
Need for clear performance metrics and oversight for R&D effectiveness.
Limited transparency on specific program objectives and exclusions in competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.3 million to RAYTHEON COMPANY. TRIPLE TARGET TERMINATOR (T3) PROGRAM

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 $21.3 million.

What is the period of performance?

Start: 2010-10-22. End: 2012-04-30.

What is the specific technological objective of the TRIPLE TARGET TERMINATOR (T3) PROGRAM?

The specific technological objective of the TRIPLE TARGET TERMINATOR (T3) PROGRAM is not publicly detailed in the provided data. However, given the contractor (Raytheon), the awarding agency (Department of the Air Force), and the NAICS code (Research and Development in the Physical, Engineering, and Life Sciences), it can be inferred that the program likely involves the development of advanced systems related to target identification, tracking, or neutralization. This could encompass areas such as sensor technology, artificial intelligence for threat assessment, advanced materials, or directed energy systems. The 'TRIPLE TARGET' designation might imply a capability to engage multiple targets simultaneously or sequentially, or to identify and differentiate between three types of threats. Further details would typically be found in classified or restricted program documentation.

How does the Cost Plus Fixed Fee (CPFF) structure compare to other R&D contract types in terms of risk and incentive?

The Cost Plus Fixed Fee (CPFF) contract type is common in research and development where the scope of work can be uncertain and evolve. In a CPFF contract, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure incentivizes the contractor to complete the work efficiently to maximize their fee relative to the effort expended. However, it places the cost risk primarily on the government, as the contractor is guaranteed their costs will be covered. Unlike fixed-price contracts, there is less direct incentive for the contractor to minimize costs, as their profit is fixed. This necessitates robust government oversight to ensure costs are reasonable and allocable to the contract. Other R&D contract types include Cost Plus Incentive Fee (CPIF), which shares cost savings or overruns between the government and contractor, and Firm-Fixed-Price (FFP) contracts, which are less common for R&D due to inherent uncertainties but offer the government the most cost certainty if the scope is well-defined.

What is the significance of 'Full and Open Competition After Exclusion of Sources'?

The designation 'Full and Open Competition After Exclusion of Sources' indicates a specific method of procurement used by the government. It means that the solicitation was made available to all responsible sources (full and open competition), but certain sources were excluded from consideration based on specific, documented reasons. These reasons might include national security concerns, proprietary data restrictions, or the need for specialized capabilities that only a limited number of entities possess. While it aims for broad competition, the exclusion clause allows for targeted procurement when necessary. The justification for excluding sources must be documented and approved. This contrasts with 'unrestricted full and open competition' where no sources are excluded, or 'sole source' procurement where only one source is solicited.

What is Raytheon Company's track record in R&D contracts with the Department of Defense?

Raytheon Company, now part of RTX Corporation, has a long and extensive track record of performing research and development contracts for the Department of Defense (DoD) and its various branches, including the Air Force. They are a major defense contractor known for its expertise in areas such as missile systems, radar technology, command and control systems, and advanced sensors. Historically, Raytheon has been a prime contractor on numerous large-scale R&D programs, contributing significantly to technological advancements in defense capabilities. Their involvement in complex projects like the TRIPLE TARGET TERMINATOR (T3) PROGRAM is consistent with their established role as a leader in defense R&D. Performance data on specific past contracts would require access to government contract databases and performance reports.

How does the $213 million contract value compare to typical R&D spending in the defense sector?

A contract value of $213 million for a research and development effort, especially within the defense sector, is substantial but not unusual for advanced technology programs. The defense R&D budget is typically in the tens of billions of dollars annually, funding a wide array of projects from basic research to system development. Contracts of this magnitude often represent significant, multi-year investments in critical capabilities. For context, major defense programs, including their R&D phases, can easily reach hundreds of millions or even billions of dollars. This specific contract's value should be considered relative to its duration (556 days) and the complexity of the R&D involved. It suggests a project of considerable scope and importance to the Air Force's technological roadmap.

What are the potential risks associated with a 556-day R&D contract duration?

A contract duration of 556 days (approximately 1.5 years) for an R&D project presents several potential risks. Firstly, technology can evolve rapidly; by the time the project concludes, the developed technology might be less cutting-edge than anticipated, or market needs could have shifted. Secondly, R&D inherently involves uncertainty. The project might encounter unforeseen technical challenges that delay progress or require significant scope adjustments, potentially leading to cost increases or schedule slippage, even within a CPFF structure. Thirdly, maintaining consistent project focus and team engagement over this period can be challenging. Finally, if the contract includes options for follow-on production or development, the initial 556-day period is critical for establishing a foundation, and any issues during this phase could jeopardize future phases.

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 › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1151 E HERMANS RD, TUCSON, AZ, 85756

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: $21,347,342

Exercised Options: $21,347,342

Current Obligation: $21,347,342

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline