Navy awards $197M contract for miscellaneous communication equipment to Navcom Defense Electronics

Contract Overview

Contract Amount: $11,447,069 ($11.4M)

Contractor: Navcom Defense Electronics, Inc.

Awarding Agency: Department of Defense

Start Date: 2006-06-20

End Date: 2008-04-30

Contract Duration: 680 days

Daily Burn Rate: $16.8K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COMBINATION (TWO OR MORE)

Sector: Defense

Official Description: 200609!451628!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002406C4004 !A!N! !N! ! !20060620!20080430!197048754!197048754!197048754!N!NAVCOM DEFENSE ELECTRONICS INC!4323 ARDEN DR !EL MONTE !CA!91731!22202!013!06!EL MONTE !CONTRA COSTA !CALIFORNIA!+000011447069!Y!N!000018505945!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !NOT DISCERNABLE !334511!E! !3! ! ! ! ! !99990909!B! ! !N!Z!B!N!J!1!001!N!4A!A!Y!C! ! !N!B!N!N! !B!Z! !A!A!000!A!B!Y!A! ! !Y!1700!N00024!0001! !

Place of Performance

Location: EL MONTE, LOS ANGELES County, CALIFORNIA, 91731

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $11.4 million to NAVCOM DEFENSE ELECTRONICS, INC. for work described as: 200609!451628!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002406C4004 !A!N! !N! ! !20060620!20080430!197048754!197048754!197048754!N!NAVCOM DEFENSE ELECTRONICS INC!4323 ARDEN DR !EL MONTE !CA!91731!22202!013!06!EL MONTE !CONT… Key points: 1. Contract value of $197 million for communication equipment suggests a significant procurement. 2. The award was not available for competition, raising questions about price discovery. 3. The contractor, Navcom Defense Electronics, Inc., is a relatively small entity based in California. 4. The contract duration of approximately two years indicates a need for ongoing support or supply. 5. The product service code (PSC) 5895 covers miscellaneous communication equipment, a broad category. 6. The North American Industry Classification System (NAICS) code 334511 points to the manufacturing of navigation, measuring, electromedical, and control instruments.

Value Assessment

Rating: questionable

The contract value of $197,048,754 is substantial for miscellaneous communication equipment. Without comparable contract data or detailed cost breakdowns, it is difficult to definitively assess value for money. The lack of competition further complicates a robust value assessment, as there was no market pressure to drive down prices. Benchmarking against similar procurements for specialized communication systems would be necessary for a more accurate evaluation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a 'not available for competition' basis, indicating that the Naval Sea Systems Command did not solicit bids from multiple vendors. This could be due to a variety of reasons, such as a sole-source justification, a specific technological requirement, or an urgent need. The lack of a competitive bidding process means that taxpayers did not benefit from the potential cost savings that competition typically provides.

Taxpayer Impact: The absence of competition means that the government may not have secured the best possible price for this equipment, potentially leading to higher costs for taxpayers.

Public Impact

The primary beneficiary of this contract is the U.S. Navy, which will receive miscellaneous communication equipment. The equipment procured will likely support naval operations, communication networks, and potentially command and control systems. The geographic impact is primarily centered in El Monte, California, where the contractor is located, potentially creating or sustaining local jobs. The contract supports the defense industrial base, specifically in the manufacturing of electronic communication equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing and reduced value for taxpayer funds.
The broad nature of 'miscellaneous communication equipment' could mask specific needs or allow for less specialized, potentially less effective solutions.
Limited information on the specific type of communication equipment makes it difficult to assess its technological relevance or obsolescence risk.

Positive Signals

The contract award to a specific company indicates a fulfillment of a perceived need by the Navy.
The existence of a contract suggests a structured procurement process, even if not competitive.
The contractor's location in California may indicate support for regional defense industry capabilities.

Sector Analysis

The procurement falls within the broader electronics and communication equipment manufacturing sector, classified under NAICS code 334511. This sector is characterized by innovation and specialized production for defense and commercial applications. The contract value of $197 million is significant, suggesting a substantial order for specific communication hardware. Comparable spending benchmarks would typically involve other large-scale procurements of communication systems for military branches, which can range from tens to hundreds of millions of dollars depending on the complexity and quantity of equipment.

Small Business Impact

There is no indication from the provided data that this contract was set aside for small businesses, nor is there information on subcontracting plans. Given the contract value, it is more likely that larger defense contractors or specialized manufacturers were considered, or that the sole-source nature precluded small business considerations. Further investigation into the contractor's size and any subcontracting requirements would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Naval Sea Systems Command (NAVSEA) and the Department of Defense's Inspector General. Accountability measures would include contract performance monitoring, delivery schedules, and quality assurance. Transparency is limited due to the sole-source nature of the award and the lack of publicly available detailed specifications or cost breakdowns. The contract's duration and value would necessitate regular oversight to ensure compliance and proper utilization of funds.

Related Government Programs

Naval Communication Systems
Defense Electronics Manufacturing
Military Communication Equipment Procurement
Department of the Navy Contracts
Sole-Source Defense Contracts

Risk Flags

Sole-source award
Lack of competition
Broad product description
Potential for overpricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.4 million to NAVCOM DEFENSE ELECTRONICS, INC.. 200609!451628!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002406C4004 !A!N! !N! ! !20060620!20080430!197048754!197048754!197048754!N!NAVCOM DEFENSE ELECTRONICS INC!4323 ARDEN DR !EL MONTE !CA!91731!22202!013!06!EL MONTE !CONTRA COSTA !CALIFORNIA!+000011447069!Y!N!000018505945!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !NOT DISCERNABLE !334511!E! !3! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is NAVCOM DEFENSE ELECTRONICS, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $11.4 million.

What is the period of performance?

Start: 2006-06-20. End: 2008-04-30.

What specific types of 'miscellaneous communication equipment' were procured under this contract?

The provided data classifies the procurement under Product Service Code (PSC) 5895, 'Miscellaneous Communication Equipment,' and North American Industry Classification System (NAICS) code 334511, 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing.' However, the specific details of the 'miscellaneous communication equipment' are not discernable from the data. This broad categorization suggests the equipment could range from radios and antennas to specialized signal processing units or components thereof. Without further documentation, such as a detailed statement of work or technical specifications, it is impossible to identify the exact nature of the items purchased. This lack of specificity can make it challenging to assess the equipment's technological relevance, operational necessity, and long-term value.

What is the track record of Navcom Defense Electronics, Inc. with government contracts, particularly with the Department of Defense?

Information regarding the specific track record of Navcom Defense Electronics, Inc. with government contracts, especially with the Department of Defense, is not detailed in the provided data snippet. The data indicates this is a contract awarded in 2006. To assess their track record, one would need to examine historical contract awards, performance reviews, and any past issues or successes they may have had with federal agencies. A company's history of delivering on time, within budget, and meeting quality standards is crucial for evaluating reliability on future procurements. Without this historical context, it's difficult to gauge their experience and capability beyond this single award.

How does the awarded price of $197 million compare to market rates for similar communication equipment?

Directly comparing the awarded price of $197 million to market rates for 'miscellaneous communication equipment' is challenging due to the broad and non-specific nature of the product description. The term 'miscellaneous' implies a wide array of potential items, each with vastly different price points and technological complexities. Furthermore, defense-specific communication equipment often carries a premium due to stringent reliability, security, and performance requirements that exceed commercial off-the-shelf (COTS) products. Without knowing the exact specifications, quantities, and required certifications of the equipment procured, a meaningful market rate comparison is not feasible. A proper benchmark would require detailed technical specifications and potentially data from other competitive solicitations for comparable military-grade communication systems.

What are the potential risks associated with a sole-source award for communication equipment?

Sole-source awards for communication equipment carry several potential risks. Firstly, the absence of competition can lead to inflated prices, as the government lacks the leverage of multiple bids to negotiate the best value. This can result in inefficient use of taxpayer funds. Secondly, it may limit access to the most innovative or suitable technologies available in the market, as only one vendor's offerings are considered. Thirdly, there's a risk of vendor lock-in, where the government becomes dependent on a single supplier, potentially facing difficulties or higher costs if they later wish to switch. Finally, without competitive pressure, the vendor may have less incentive to prioritize quality, timely delivery, or exceptional customer service, although contract oversight mechanisms are intended to mitigate this.

What is the historical spending pattern for miscellaneous communication equipment by the Department of the Navy?

The provided data snippet focuses on a single contract awarded in 2006. To understand the historical spending pattern for miscellaneous communication equipment by the Department of the Navy, a comprehensive analysis of federal procurement databases (like USASpending.gov or FPDS) over multiple fiscal years would be necessary. This analysis should include tracking spending trends for PSC 5895 and related codes, identifying major contractors, and noting fluctuations in spending levels. Such a review would reveal whether this $197 million award was an anomaly, part of a larger trend, or indicative of a sustained investment in this category of equipment. It would also help identify periods of increased or decreased procurement activity.

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 AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COMBINATION (TWO OR MORE) (2)

Evaluated Preference: NONE

Contractor Details

Address: 4323 ARDEN DR, EL MONTE, CA, 31

Business Categories: Category Business, Small Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $18,505,945

Current Obligation: $11,447,069

Contract Characteristics

Cost or Pricing Data: NO

Timeline