Raytheon Awarded $1.5B for RAAF and USN TAS IMPLC Systems Under Sole-Source Contract

Contract Overview

Contract Amount: $15,022,665 ($15.0M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2007-12-03

End Date: 2011-12-31

Contract Duration: 1,489 days

Daily Burn Rate: $10.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TAS::17 1804::TAS IMPLC (RAAF AND USN)

Place of Performance

Location: GOLETA, SANTA BARBARA County, CALIFORNIA, 93117

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $15.0 million to RAYTHEON COMPANY for work described as: TAS::17 1804::TAS IMPLC (RAAF AND USN) Key points: 1. Significant investment in critical defense technology for allied and naval forces. 2. Sole-source award raises questions about price discovery and potential cost efficiencies. 3. Long-term contract duration (1489 days) suggests a sustained need for these systems. 4. Focus on Search, Detection, Navigation, and Guidance systems highlights a key defense capability area.

Value Assessment

Rating: questionable

The contract was awarded on a sole-source basis, making a direct pricing comparison difficult. Without competitive bidding, it's challenging to ascertain if the $1.5 billion price reflects optimal value for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This limits price discovery and may result in higher costs compared to a competitive environment.

Taxpayer Impact: The lack of competition for a $1.5 billion contract raises concerns about taxpayer value and the potential for inflated costs.

Public Impact

Enhances critical defense capabilities for both the Royal Australian Air Force and the US Navy. Supports advanced technology in search, detection, and navigation systems. Represents a substantial commitment of federal funds towards defense procurement.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Sole-source award
High contract value

Positive Signals

Critical defense technology
Long-term contract

Sector Analysis

This contract falls within the Defense sector, specifically in the manufacturing of advanced navigation and guidance systems. Spending benchmarks for similar sole-source defense contracts can vary widely, but large-value, non-competed awards warrant close scrutiny.

Small Business Impact

There is no indication that small businesses were involved in this specific contract award. Further analysis would be needed to determine if subcontracting opportunities were explored.

Oversight & Accountability

The sole-source nature of this award necessitates robust oversight to ensure the government receives fair value and that the contractor meets all performance requirements.

Related Government Programs

Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Potential for overpayment due to lack of competition
Risk of contractor lock-in
Limited transparency in pricing
Dependency on a single supplier for critical technology

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.0 million to RAYTHEON COMPANY. TAS::17 1804::TAS IMPLC (RAAF AND USN)

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 $15.0 million.

What is the period of performance?

Start: 2007-12-03. End: 2011-12-31.

What was the justification for awarding this contract on a sole-source basis instead of seeking competitive bids?

The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or a lack of alternative sources that meet specific defense requirements. Without detailed documentation, it's difficult to assess if these criteria were met, but it's a critical factor in understanding the value proposition.

How does the $1.5 billion cost compare to similar sole-source contracts for comparable defense systems?

Benchmarking sole-source contracts is inherently challenging due to the absence of direct price competition. A thorough review would require access to classified or proprietary data on similar systems and contracts, as well as an understanding of the specific technological advancements and operational requirements driving this particular award.

What mechanisms are in place to ensure the effectiveness and performance of these systems given the sole-source nature of the contract?

Effectiveness is typically ensured through stringent performance metrics, milestone payments tied to deliverables, and rigorous testing and acceptance protocols outlined in the contract. The Defense Contract Management Agency (DCMA) plays a crucial role in overseeing contractor performance and ensuring compliance with contract terms.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

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

Address: 6380 HOLLISTER AVE, GOLETA, CA, 93117

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $15,032,665

Exercised Options: $15,032,665

Current Obligation: $15,022,665

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline