DHS awards $13.3M non-competitive contract for system integration to Raytheon Company

Contract Overview

Contract Amount: $13,280,000 ($13.3M)

Contractor: Raytheon Company

Awarding Agency: Department of Homeland Security

Start Date: 2008-12-27

End Date: 2012-07-31

Contract Duration: 1,312 days

Daily Burn Rate: $10.1K/day

Competition Type: NON-COMPETITIVE DELIVERY ORDER

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: SYSTEM INTEGRATION SERVICES FOR REALIGNED AT DEPLOYMENT STRATEGY.

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22202

State: Virginia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $13.3 million to RAYTHEON COMPANY for work described as: SYSTEM INTEGRATION SERVICES FOR REALIGNED AT DEPLOYMENT STRATEGY. Key points: 1. Contract awarded on a non-competitive basis, raising questions about potential cost savings and market competition. 2. The contract duration of 1312 days suggests a significant, long-term need for these system integration services. 3. Awarded by the Department of Homeland Security (DHS) to support the Transportation Security Administration (TSA). 4. The use of Time and Materials pricing may lead to cost overruns if not closely managed. 5. Raytheon Company, a large defense contractor, is the recipient, indicating a focus on established players. 6. The contract's value of $13.3 million warrants scrutiny for value for money given the lack of competition.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its non-competitive nature and the specific system integration services provided. Without comparable bids, it's difficult to assess if the $13.3 million represents a fair market price. The Time and Materials (T&M) pricing structure, while flexible, can sometimes lead to higher costs compared to fixed-price contracts if not meticulously managed and monitored for efficiency. Further analysis would require understanding the specific technical requirements and the prevailing market rates for similar specialized system integration services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a non-competitive delivery order, meaning there was no formal solicitation process where multiple vendors could bid. This typically occurs when a specific vendor is deemed the only capable source, or in urgent situations. The lack of competition means that price discovery through market forces was bypassed, potentially leading to higher costs for the government. It is crucial to understand the justification for this sole-source award to ensure it was indeed necessary and that alternatives were not overlooked.

Taxpayer Impact: Taxpayers may have paid a premium for these services due to the absence of competitive bidding. The government did not benefit from the price reductions that typically arise from a competitive procurement process.

Public Impact

The Transportation Security Administration (TSA) is the primary beneficiary, receiving system integration services to support its deployment strategy. This contract directly impacts the operational efficiency and technological capabilities of the TSA. The services delivered are critical for the modernization and realignment of TSA's systems. The geographic impact is likely concentrated within TSA's operational areas, primarily in Virginia where the contract is managed. The workforce implications involve specialized technical personnel required for system integration, likely employed by Raytheon Company.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Non-competitive award limits transparency and potential cost savings.
Time and Materials pricing structure carries inherent risk of cost escalation.
Lack of competition may indicate limited market availability or a failure to explore alternatives.
Contract duration suggests a long-term commitment, requiring sustained oversight.

Positive Signals

Award to a large, established contractor like Raytheon Company may imply a certain level of technical capability and reliability.
The contract is for system integration, a critical function for modernizing government operations.
The contract is managed within Virginia, potentially supporting local technical expertise.

Sector Analysis

This contract falls within the Engineering Services sector, specifically related to system integration. The broader IT and defense contracting markets are characterized by significant spending on complex system integration projects. Companies like Raytheon Company are major players in this space, often handling large-scale, mission-critical systems for government agencies. Benchmarks for similar system integration contracts can vary widely based on complexity, duration, and the specific technologies involved, but a $13.3 million award for a multi-year project is substantial.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The award to a large prime contractor like Raytheon Company suggests that subcontracting opportunities for small businesses may exist, but this is not guaranteed. The government's focus on small business utilization would typically be assessed through subcontracting plans, which are not detailed here. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem is unclear.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Homeland Security and the Transportation Security Administration. Given it's a delivery order under an existing contract (indicated by 'aw': 'DO'), the initial contract vehicle likely had established oversight mechanisms. However, the non-competitive nature necessitates rigorous monitoring of performance, costs, and adherence to the Statement of Work to ensure accountability and prevent potential waste. Transparency is limited by the lack of public competition, making detailed public scrutiny more challenging.

Related Government Programs

Department of Homeland Security IT Modernization Programs
Transportation Security Administration Technology Investments
Federal System Integration Contracts
Defense Contractor Support Services

Risk Flags

Non-competitive award
Time and Materials pricing
Lack of detailed scope definition in provided data

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $13.3 million to RAYTHEON COMPANY. SYSTEM INTEGRATION SERVICES FOR REALIGNED AT DEPLOYMENT STRATEGY.

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Transportation Security Administration).

What is the total obligated amount?

The obligated amount is $13.3 million.

What is the period of performance?

Start: 2008-12-27. End: 2012-07-31.

What specific system integration services were provided under this contract?

The contract, "SYSTEM INTEGRATION SERVICES FOR REALIGNED AT DEPLOYMENT STRATEGY," awarded to Raytheon Company by the Department of Homeland Security's Transportation Security Administration (TSA), focused on integrating systems related to a 'realigned at deployment strategy.' While the exact technical details are not specified in the provided data, system integration typically involves combining disparate hardware, software, and network components into a cohesive, functioning whole. This could encompass activities such as requirements analysis, system design, software development and integration, hardware procurement and setup, testing, and deployment support. The goal is to ensure that various technological elements work together seamlessly to achieve the TSA's strategic objectives for its deployed systems.

What is the justification for this contract being awarded on a non-competitive basis?

The provided data indicates this contract was awarded as a 'NON-COMPETITIVE DELIVERY ORDER.' Government contracts are typically awarded through full and open competition to ensure the best value for taxpayers. However, non-competitive awards (sole-source) are permissible under specific circumstances outlined in federal acquisition regulations, such as when only one responsible source can provide the required supplies or services, or in cases of urgent and compelling need. Without further documentation or justification from the Department of Homeland Security, the precise reason for this sole-source award remains unclear. It is possible that Raytheon Company possessed unique capabilities, proprietary technology, or was the only vendor capable of meeting the specific, time-sensitive requirements of the TSA's deployment strategy realignment.

How does the Time and Materials (T&M) pricing structure impact the overall cost and risk for the government?

The Time and Materials (T&M) pricing structure, used in this $13.3 million contract, allows the government to pay the contractor for the direct labor hours at specified hourly rates and for the actual cost of materials. While T&M contracts offer flexibility, especially when the scope of work is not clearly defined or is expected to change, they carry a higher risk of cost overruns for the government compared to fixed-price contracts. The government bears the risk of cost increases if the contractor's labor hours or material costs are higher than anticipated. Effective oversight, detailed tracking of hours and expenses, and strong contract management are crucial to mitigate these risks and ensure that the government receives good value for its investment.

What is the historical spending pattern for similar system integration services at the TSA or DHS?

Analyzing historical spending patterns for similar system integration services at the TSA or DHS is crucial for benchmarking this $13.3 million award. Without access to historical contract databases or specific spending reports, it's difficult to provide precise figures. However, system integration is a core function for agencies like TSA, which constantly need to update and integrate complex security and operational systems. Spending in this area can fluctuate based on major technology refresh cycles, new security mandates, or strategic realignments. A non-competitive award of this magnitude suggests a significant, potentially unique, requirement. Comparing this award to previous sole-source or competitively awarded system integration contracts for similar functions at TSA/DHS would reveal whether this represents a typical investment or an outlier.

What is Raytheon Company's track record with the Department of Homeland Security, particularly for system integration services?

Raytheon Company is a major defense and aerospace contractor with a significant history of working with various U.S. government agencies, including the Department of Homeland Security (DHS). Their track record typically involves providing a wide range of services and products, including complex system integration, cybersecurity solutions, and mission support. For DHS specifically, Raytheon has been involved in numerous contracts supporting various components like Customs and Border Protection (CBP) and the Transportation Security Administration (TSA). While specific performance details for this particular $13.3 million contract are not available, Raytheon's general experience suggests they possess the technical capabilities to handle such projects. However, a thorough assessment would require reviewing past performance evaluations and any documented issues on previous DHS contracts.

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: NON-COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 22265 PACIFIC BLVD, DULLES, VA, 10

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $13,280,000

Exercised Options: $13,280,000

Current Obligation: $13,280,000

Parent Contract

Parent Award PIID: GS23F0263K

IDV Type: FSS

Timeline