DoD's $16.3M SPS-48 Contract Awarded to L3Harris Technologies Raises Questions on Competition
Contract Overview
Contract Amount: $16,300,352 ($16.3M)
Contractor: L3harris Technologies, Inc
Awarding Agency: Department of Defense
Start Date: 2023-07-11
End Date: 2026-09-01
Contract Duration: 1,148 days
Daily Burn Rate: $14.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: SPS-48 MATERIAL AND SERVICES
Place of Performance
Location: VAN NUYS, LOS ANGELES County, CALIFORNIA, 91406
Plain-Language Summary
Department of Defense obligated $16.3 million to L3HARRIS TECHNOLOGIES, INC for work described as: SPS-48 MATERIAL AND SERVICES Key points: 1. Significant contract value of $16.3M for radar systems. 2. Sole awardee L3Harris Technologies, Inc. raises competition concerns. 3. Department of Defense, specifically the Navy, is the procuring agency. 4. The contract falls under the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector.
Value Assessment
Rating: questionable
The contract is a Cost Plus Fixed Fee type, which can lead to cost overruns if not managed carefully. Benchmarking against similar contracts for radar systems is difficult without more detailed cost breakdowns.
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 potentially leads to higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition may result in the government paying more than necessary for these critical radar systems, impacting taxpayer funds.
Public Impact
Ensures continued operation and maintenance of essential Navy radar systems. Potential for increased costs due to non-competitive award. Impacts the defense industrial base and L3Harris Technologies' market position.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost-plus contract type
- Potential for cost overruns
Positive Signals
- Ensures critical system availability
- Supports a key defense contractor
Sector Analysis
This contract falls within the defense electronics sector, specifically focusing on radar systems. Spending in this area is critical for national security, but competitive bidding is crucial to ensure cost-effectiveness.
Small Business Impact
The data does not indicate any involvement of small businesses in this contract, suggesting a focus on large prime contractors.
Oversight & Accountability
Further oversight is needed to ensure the Cost Plus Fixed Fee structure is managed effectively and that the government receives fair value despite the sole-source award.
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
- Sole-source award
- Cost-plus contract type
- Lack of transparency in pricing justification
- Potential for cost overruns
Tags
search-detection-navigation-guidance-aer, department-of-defense, ca, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $16.3 million to L3HARRIS TECHNOLOGIES, INC. SPS-48 MATERIAL AND SERVICES
Who is the contractor on this award?
The obligated recipient is L3HARRIS TECHNOLOGIES, 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 $16.3 million.
What is the period of performance?
Start: 2023-07-11. End: 2026-09-01.
What is the 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 factors like unique capabilities, urgent need, or lack of viable alternatives. Without specific details on the justification, it's difficult to assess the fairness of the pricing. However, cost-plus contracts inherently carry a risk of higher costs if not rigorously monitored for efficiency and necessity of expenditures.
What are the potential risks associated with a Cost Plus Fixed Fee contract for these radar systems, particularly given the lack of competition?
The primary risk with a Cost Plus Fixed Fee contract is that the contractor may have less incentive to control costs, as the government covers allowable expenses plus a fixed fee. When combined with a sole-source award, this risk is amplified, as there's no competitive pressure to drive efficiency or lower prices. This could lead to the government paying a premium for the services and materials.
How does the performance of L3Harris Technologies on similar contracts inform the assessment of this award's effectiveness and value?
Assessing the effectiveness and value of this award requires examining L3Harris Technologies' past performance on comparable defense contracts. If they have a history of delivering on time, within budget (or with justifiable cost variances), and meeting technical specifications, it lends some confidence. However, the lack of competition in this specific award still warrants scrutiny regarding pricing and potential for cost savings.
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
Solicitation ID: N0002419R5500
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 7821 ORION AVE, VAN NUYS, CA, 91406
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $16,300,352
Exercised Options: $16,300,352
Current Obligation: $16,300,352
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0002419G5500
IDV Type: BOA
Timeline
Start Date: 2023-07-11
Current End Date: 2026-09-01
Potential End Date: 2026-09-01 00:00:00
Last Modified: 2025-12-18
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