DoD Awards $40.3M for High-Band Hardware to Sierra Nevada Company, LLC

Contract Overview

Contract Amount: $40,270,214 ($40.3M)

Contractor: Sierra Nevada Company, LLC

Awarding Agency: Department of Defense

Start Date: 2024-06-14

End Date: 2026-12-31

Contract Duration: 930 days

Daily Burn Rate: $43.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MISD HIGH-BAND HARDWARE F24 DELIVERY ORDER.

Place of Performance

Location: SPARKS, WASHOE County, NEVADA, 89434

State: Nevada Government Spending

Plain-Language Summary

Department of Defense obligated $40.3 million to SIERRA NEVADA COMPANY, LLC for work described as: MISD HIGH-BAND HARDWARE F24 DELIVERY ORDER. Key points: 1. Significant award for specialized hardware, indicating a critical need within the Navy. 2. Sole-source award raises questions about price discovery and potential for better value. 3. Long-term delivery schedule (2026) suggests a substantial, ongoing requirement. 4. The contract falls under the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector.

Value Assessment

Rating: questionable

The contract's value is substantial, but without competitive bidding, it's difficult to assess if the price is optimal. Benchmarking against similar sole-source procurements in this specialized sector would be necessary.

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 a higher cost to taxpayers compared to a competitive process.

Taxpayer Impact: The lack of competition for this $40.3 million contract means taxpayers may not be receiving the best possible value for this high-band hardware.

Public Impact

Impacts naval operations and readiness through the provision of critical hardware. Potential for increased costs due to the absence of competitive bidding. Highlights reliance on specific vendors for specialized defense systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for overpricing
Long-term commitment

Positive Signals

Addresses a specific, critical need
Clear delivery timeline

Sector Analysis

This contract falls within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector, which often involves highly specialized and proprietary technologies. Spending in this area is critical for national defense, but can be prone to higher costs due to limited vendor pools.

Small Business Impact

The awardee, Sierra Nevada Company, LLC, is a large business. There is no indication that small businesses were involved in this specific delivery order, nor is there a stated requirement for subcontracting to small businesses.

Oversight & Accountability

The sole-source nature of this award warrants close oversight to ensure fair pricing and adherence to contract terms. The Department of the Navy should document the justification for not competing this requirement.

Related Government Programs

Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Lack of competitive bidding
Potential for inflated pricing
Limited transparency on price justification
Reliance on a single vendor for critical hardware

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $40.3 million to SIERRA NEVADA COMPANY, LLC. MISD HIGH-BAND HARDWARE F24 DELIVERY ORDER.

Who is the contractor on this award?

The obligated recipient is SIERRA NEVADA COMPANY, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $40.3 million.

What is the period of performance?

Start: 2024-06-14. End: 2026-12-31.

What is the specific justification for awarding this contract on a sole-source basis, and what steps were taken to ensure fair and reasonable pricing?

The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs that cannot be met by other vendors. The Department of the Navy should have conducted a price analysis, potentially using historical data or independent government cost estimates, to ensure the price paid was fair and reasonable despite the lack of competition.

How does the per-unit cost of this hardware compare to similar systems procured competitively by other defense agencies or allies?

Without access to specific unit cost data and comparable contract information, a direct comparison is challenging. However, the absence of competition suggests a higher likelihood of inflated per-unit costs. Benchmarking against publicly available data for similar, competitively procured systems would be essential to identify potential cost inefficiencies.

What is the long-term strategic value of this high-band hardware, and are there plans to foster competition for future requirements in this area?

The long-term strategic value lies in its contribution to naval operational capabilities. To foster future competition, the Navy could explore market research to identify potential alternative vendors, encourage industry days, or consider breaking down future requirements into smaller, more competitive lots.

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

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Sierra Nevada Corporation

Address: 444 SALOMON CIR, SPARKS, NV, 89434

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $40,270,214

Exercised Options: $40,270,214

Current Obligation: $40,270,214

Subaward Activity

Number of Subawards: 31

Total Subaward Amount: $30,676,132

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001923D0012

IDV Type: IDC

Timeline