DoD awards Raytheon $85M for Technical Services, contract awarded via sole-source procurement
Contract Overview
Contract Amount: $85,113,503 ($85.1M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2005-11-01
End Date: 2010-10-31
Contract Duration: 1,825 days
Daily Burn Rate: $46.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92123
Plain-Language Summary
Department of Defense obligated $85.1 million to RAYTHEON COMPANY for work described as: Key points: 1. Significant contract value of $85.1M awarded to a major defense contractor. 2. Sole-source award raises questions about competition and potential price discovery. 3. Contract duration of 5 years suggests a long-term need for these services. 4. The 'All Other Professional, Scientific, and Technical Services' NAICS code is broad, making direct benchmarking difficult.
Value Assessment
Rating: fair
The contract type is Cost Plus Award Fee (CPAF), which can incentivize performance but also lead to higher costs if not managed tightly. Without specific performance metrics or comparable contracts, assessing the value is challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This limits price discovery and may result in higher costs compared to a competitive process.
Taxpayer Impact: The lack of competition for an $85M contract could mean taxpayers are not receiving the best possible price for these services.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. The long contract duration could lock in potentially inflated costs over five years. Lack of transparency in the sole-source award process hinders public scrutiny.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Broad service category
Positive Signals
- Award to established contractor
- Long-term service provision
Sector Analysis
This contract falls under 'All Other Professional, Scientific, and Technical Services,' a broad category. Spending in this sector can vary widely, but large sole-source awards warrant scrutiny to ensure fair pricing.
Small Business Impact
The data indicates this contract was not awarded to small businesses, and the sole-source nature further limits opportunities for small business participation.
Oversight & Accountability
The sole-source nature of this award necessitates robust oversight from the Department of Defense to ensure cost reasonableness and effective performance, especially given the CPAF structure.
Related Government Programs
- All Other Professional, Scientific, and Technical Services
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Potential for overpayment due to sole-source award.
- Lack of transparency in procurement process.
- Cost-plus contract type may lead to higher costs.
- Broad service category makes benchmarking difficult.
Tags
all-other-professional-scientific-and-te, department-of-defense, ca, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $85.1 million to RAYTHEON COMPANY. See the official description on USAspending.
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 $85.1 million.
What is the period of performance?
Start: 2005-11-01. End: 2010-10-31.
What specific technical services are being procured under this broad NAICS code, and why was competition deemed impractical?
The specific technical services are not detailed in the provided data. However, the sole-source justification would typically outline unique capabilities, proprietary technology, or urgent needs that preclude a competitive solicitation. Understanding these specifics is crucial for assessing the necessity of the sole-source award and its potential impact on cost.
How does the Cost Plus Award Fee (CPAF) structure ensure cost control and value for money in this sole-source context?
A CPAF contract allows for reimbursement of allowable costs plus an award fee based on performance targets. In a sole-source scenario, the government must meticulously define these targets and the fee structure to incentivize efficiency and prevent cost overruns. Without clear performance metrics and rigorous oversight, the award fee component could inflate costs without commensurate value.
What is the historical cost performance of Raytheon Company on similar sole-source contracts with the Department of Defense?
Analyzing Raytheon's past performance on comparable sole-source contracts would provide valuable insight into their cost management and pricing practices. If historical data shows consistent cost overruns or a pattern of high award fees without exceptional performance, it would raise concerns about the current contract's value and taxpayer impact.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services
Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp (UEI: 001344142)
Address: 8680 BALBOA AVE, SAN DIEGO, CA, 92123
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2005-11-01
Current End Date: 2010-10-31
Potential End Date: 2010-10-31 00:00:00
Last Modified: 2021-05-17
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