Textron Systems awarded $21.2M for engineering support, a sole-source contract with a 371-day duration

Contract Overview

Contract Amount: $21,212,528 ($21.2M)

Contractor: Textron Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2025-02-21

End Date: 2026-02-27

Contract Duration: 371 days

Daily Burn Rate: $57.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ENGINEERING SUPPORT

Place of Performance

Location: COCKEYSVILLE, BALTIMORE County, MARYLAND, 21030

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $21.2 million to TEXTRON SYSTEMS CORPORATION for work described as: ENGINEERING SUPPORT Key points: 1. Contract awarded on a sole-source basis, raising questions about potential price efficiencies. 2. The contract duration of 371 days suggests a need for ongoing, specialized engineering expertise. 3. The fixed-fee structure on a cost-plus award indicates a defined profit margin for the contractor. 4. The award is for engineering services, a critical component for defense readiness and technological advancement. 5. The primary performance location is Maryland, a hub for defense contracting and federal agencies.

Value Assessment

Rating: questionable

Benchmarking the value of this sole-source contract is challenging without competitive bids. The cost-plus, fixed-fee structure allows for cost reimbursement plus a predetermined profit, which can sometimes lead to higher overall costs compared to fixed-price contracts. Without comparable contract data or a competitive bidding process, it's difficult to definitively assess if the $21.2 million represents a fair market price for the engineering services provided. The benchmarked value of $5.7 million for this type of service suggests a significant premium, warranting further scrutiny.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor possesses the necessary capabilities or when urgency dictates a rapid award. The lack of competition limits the government's ability to leverage market forces to achieve the best possible pricing and terms. It also means that potential cost savings that could arise from a competitive bidding process are unlikely to be realized.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competition, as there was no opportunity to solicit multiple bids and negotiate the most cost-effective solution.

Public Impact

The Department of the Navy benefits from specialized engineering support crucial for its operations. This contract ensures the continued development and maintenance of critical defense systems. The primary geographic impact is in Maryland, supporting the local defense industrial base. The contract supports specialized engineering roles, potentially impacting the federal workforce in this domain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potential cost savings for taxpayers.
Cost-plus contract type can incentivize higher spending if not closely monitored.
Lack of competition may reduce pressure on the contractor to innovate or improve efficiency.
The benchmarked value is significantly lower than the awarded amount, raising concerns about value for money.

Positive Signals

Awarding to Textron Systems Corporation leverages established expertise in engineering support.
The fixed-fee component provides a degree of cost certainty regarding contractor profit.
The contract duration suggests a stable, long-term need for these critical engineering services.

Sector Analysis

Engineering services are a vital component of the defense sector, encompassing design, development, testing, and sustainment of complex military systems. The market for these services is characterized by high barriers to entry due to specialized knowledge, security clearances, and established relationships. This contract fits within the broader category of professional services supporting defense acquisition and sustainment, where spending can fluctuate based on program needs and technological advancements. Comparable spending benchmarks for engineering services can vary widely based on complexity and duration.

Small Business Impact

This contract does not appear to have a small business set-aside. As a sole-source award, there is no explicit subcontracting plan requirement for small businesses mandated by competition. The impact on the small business ecosystem is likely minimal unless Textron Systems Corporation voluntarily engages small businesses for specialized support, which is not detailed in the provided data.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. Accountability measures are inherent in the cost-plus, fixed-fee structure, which requires detailed reporting of costs and adherence to the fixed fee. Transparency may be limited due to the sole-source nature of the award. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse.

Related Government Programs

Department of Defense Engineering Services
Naval Systems Engineering Support
Cost-Plus Fixed Fee Contracts
Sole Source Defense Contracts

Risk Flags

Sole-source award
Cost-plus contract type
Potential for cost overruns
Lack of competitive pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.2 million to TEXTRON SYSTEMS CORPORATION. ENGINEERING SUPPORT

Who is the contractor on this award?

The obligated recipient is TEXTRON SYSTEMS CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $21.2 million.

What is the period of performance?

Start: 2025-02-21. End: 2026-02-27.

What is Textron Systems Corporation's track record with the Department of Defense, particularly for engineering support contracts?

Textron Systems Corporation has a significant history of contracting with the Department of Defense, often providing advanced technology solutions, engineering services, and support for various platforms. Their track record includes work on unmanned systems, marine craft, and armored vehicles, among others. For engineering support specifically, they have been involved in complex projects requiring specialized expertise. A review of their past performance on similar contracts would be necessary to fully assess their capabilities and reliability in delivering the required engineering services for this specific award. Past performance evaluations and any documented issues or successes would provide crucial context for understanding the risk associated with this sole-source award.

How does the awarded amount of $21.2 million compare to similar engineering support contracts awarded by the Department of the Navy?

Comparing the $21.2 million award to similar contracts is challenging without more specific details on the scope of work and duration. However, the provided benchmark value of $5.7 million for this type of service suggests a substantial difference. If this benchmark represents a typical cost for comparable engineering services, then the awarded amount is significantly higher. This discrepancy warrants further investigation into the specific requirements of this contract, the unique capabilities Textron Systems Corporation brings, and the justification for the sole-source award. Without competitive bidding, it is difficult to ascertain if the government received the best possible value.

What are the primary risks associated with a sole-source award for engineering support services?

The primary risks associated with a sole-source award for engineering support services include a lack of price competition, which can lead to higher costs for the government. Without multiple bids, there is less incentive for the contractor to offer the most competitive pricing. Additionally, the government may miss out on innovative solutions or alternative approaches that could have been proposed by other qualified vendors. There's also a potential risk of complacency from the awarded contractor, as they face no immediate competitive threat. Ensuring robust oversight and clear performance metrics becomes even more critical to mitigate these risks and ensure the government receives adequate value for its investment.

What is the typical duration for engineering support contracts of this nature, and how does this contract's duration compare?

The duration for engineering support contracts can vary significantly based on the complexity of the project, the phase of the system lifecycle (e.g., research, development, sustainment), and the specific requirements of the agency. Contracts can range from a few months for specific tasks to several years for long-term sustainment or development programs. This contract's duration of 371 days (approximately one year) suggests a need for sustained, ongoing engineering expertise rather than a short-term, project-specific requirement. This duration is not unusually long for specialized engineering support, but it does indicate a continuous need for the services provided by Textron Systems Corporation.

What is the significance of the 'Cost Plus Fixed Fee' (CPFF) contract type in this context?

The Cost Plus Fixed Fee (CPFF) contract type means that the contractor (Textron Systems Corporation) is reimbursed for all allowable costs incurred in performing the contract, plus a fixed fee representing profit. This structure is often used when the scope of work is not precisely defined at the outset, or when there is a high degree of uncertainty in the costs. The 'fixed fee' provides the government with some predictability regarding the contractor's profit margin. However, it can also incentivize the contractor to incur costs, as their profit is not directly tied to cost savings. Close monitoring of allowable costs and performance is crucial for effective management of CPFF contracts.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0002424R6304

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Textron Inc

Address: 124 INDUSTRY LN, HUNT VALLEY, MD, 21030

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: $100,123,334

Exercised Options: $31,796,534

Current Obligation: $21,212,528

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline