DoD's $107.7M contract for communication equipment awarded to L-3 Communications Display Systems in 2000

Contract Overview

Contract Amount: $10,769,341 ($10.8M)

Contractor: L-3 Communications Display SYS

Awarding Agency: Department of Defense

Start Date: 2000-08-29

End Date: 2011-07-14

Contract Duration: 3,971 days

Daily Burn Rate: $2.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200012!1700!004711!JA104 !NAVAL INVENTORY CONTROL POINT !N0038300C019F !A!*!* !20000829!20070828!806625547!008898884!008898843!N!65316!L-3 COMMUNICATIONS DISPLAY SYS!1355 BLUEGRASS LAKES PARKW!ALPHARETTA !GA!30004!01696!121!13!ALPHARETTA !FULTON !GEORGIA !0001!+000009080005!N!N!000000000000!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION !2AEB!E-2 HAWKEYE !3661!3!*!*!*!B!A!*!D !U!J!1!001!N!1A!A!Y!A!* !* !N!C!*!A!A!A!A!A!A!* !*!N!A!C!N!*!*!*!*!*!

Place of Performance

Location: ALPHARETTA, FORSYTH County, GEORGIA, 30004

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $10.8 million to L-3 COMMUNICATIONS DISPLAY SYS for work described as: 200012!1700!004711!JA104 !NAVAL INVENTORY CONTROL POINT !N0038300C019F !A!*!* !20000829!20070828!806625547!008898884!008898843!N!65316!L-3 COMMUNICATIONS DISPLAY SYS!1355 BLUEGRASS LAKES PARKW!ALPHARETTA !GA!30004!01696!121!13!ALPHARETTA !FUL… Key points: 1. Contract awarded for communication equipment, with a significant value of over $100 million. 2. The contract was not competed, raising questions about potential cost efficiencies and market fairness. 3. L-3 Communications Display Systems, the sole awardee, has a substantial track record with the Department of Defense. 4. The contract duration spanned over a decade, indicating a long-term need for the specified equipment. 5. The equipment is categorized under 'MISCELLANEOUS COMMUNICATION EQUIPMENT', suggesting a broad range of potential applications. 6. The contract's value and non-competitive nature warrant scrutiny for optimal taxpayer value.

Value Assessment

Rating: fair

The contract value of $107.7 million for miscellaneous communication equipment is substantial. Without competitive bidding, it is difficult to benchmark the pricing against market rates or similar contracts. The firm-fixed-price nature suggests that the contractor assumed the risk for cost overruns, which is a positive indicator. However, the lack of competition prevents a thorough assessment of whether this price represents the best value achievable.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not openly competed. This approach is typically used when only one source is capable of meeting the requirement, or in cases of urgent need. The absence of multiple bidders means there was no direct price comparison or negotiation driven by market forces, potentially leading to a higher price than if it had been competed.

Taxpayer Impact: Sole-source awards can result in taxpayers paying a premium, as the government does not benefit from the cost-saving pressures that competition typically generates.

Public Impact

The Department of Defense is the primary beneficiary, receiving critical communication equipment. The contract supports the E-2 Hawkeye aircraft program, indicating a specific operational need. The geographic impact is centered in Alpharetta, Georgia, where the contractor is located. The contract likely supported jobs within L-3 Communications Display Systems and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may have led to inflated pricing.
Sole-source awards can reduce transparency in government spending.
Long contract duration without re-competition might miss opportunities for technological upgrades or cost savings.

Positive Signals

Firm-fixed-price contract structure shifts cost risk to the contractor.
Awardee is an established defense contractor with a history of performance.
Contract duration suggests a stable, long-term requirement met by the awarded solution.

Sector Analysis

This contract falls within the Defense sector, specifically related to electronic and communication equipment. The market for such specialized military communication systems is often characterized by a limited number of qualified suppliers due to high technical requirements and security clearances. Comparable spending benchmarks are difficult to establish without knowing the exact specifications and quantities, but multi-million dollar contracts for specialized defense electronics are common.

Small Business Impact

There is no indication that this contract included small business set-asides. As a sole-source award to a large corporation, it is unlikely to have directly benefited small businesses through subcontracting opportunities unless L-3 Communications Display Systems voluntarily engaged them. The impact on the small business ecosystem is therefore likely minimal.

Oversight & Accountability

As a Department of Defense contract, it would have been subject to internal oversight mechanisms and potentially audits by agencies like the Defense Contract Audit Agency (DCAA). Inspector General oversight would also apply. However, the lack of competition limits the scope for external scrutiny regarding price reasonableness and value for money.

Related Government Programs

Defense Communications Systems
Military Electronics Procurement
Aerospace Communication Equipment
Naval Inventory Control Point Contracts

Risk Flags

Sole-source award lacks competitive price discovery.
Long contract duration may lead to technology obsolescence.
Lack of transparency in pricing due to non-competitive nature.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.8 million to L-3 COMMUNICATIONS DISPLAY SYS. 200012!1700!004711!JA104 !NAVAL INVENTORY CONTROL POINT !N0038300C019F !A!*!* !20000829!20070828!806625547!008898884!008898843!N!65316!L-3 COMMUNICATIONS DISPLAY SYS!1355 BLUEGRASS LAKES PARKW!ALPHARETTA !GA!30004!01696!121!13!ALPHARETTA !FULTON !GEORGIA !0001!+000009080005!N!N!000000000000!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION !2AEB!E-2 HAWKEYE !3661!3!*!*!*!B!A!*!D !U!J!

Who is the contractor on this award?

The obligated recipient is L-3 COMMUNICATIONS DISPLAY SYS.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $10.8 million.

What is the period of performance?

Start: 2000-08-29. End: 2011-07-14.

What was the specific nature of the 'MISCELLANEOUS COMMUNICATION EQUIPMENT' procured under this contract?

The data indicates the equipment procured was 'MISCELLANEOUS COMMUNICATION EQUIPMENT' with a Product Service Code (PSC) of 5895. This PSC typically covers items such as radio and signal equipment, electronic communication equipment, and related components. Given the awardee and the context of the E-2 Hawkeye aircraft program, it likely involved specialized communication systems, displays, or components critical for airborne operations. The exact specifications would be detailed in the contract's statement of work, which is not provided in the summary data.

Why was this contract awarded on a sole-source basis instead of being competed?

The provided data explicitly states the contract type as 'NOT COMPETED', which is synonymous with sole-source in this context. Common justifications for sole-source awards include a lack of available competition, unique capabilities held by a single contractor, urgent and compelling needs where competition is impractical, or specific national security requirements. Without further documentation from the awarding agency (Naval Inventory Control Point), the precise reason for the sole-source award remains unspecified, but it implies that competitive procedures were deemed inappropriate or impossible at the time of award.

How does the contract's value of over $107 million compare to similar procurements for communication equipment?

Comparing the $107.7 million value requires context on the specific type and quantity of communication equipment. For specialized military-grade communication systems, especially those integrated into complex platforms like the E-2 Hawkeye, such a value is not unusual, particularly over a long contract duration. However, without competitive bidding, it's impossible to definitively state if this represents a fair market price. If this contract had been competed, it's plausible that multiple bids could have driven the price lower, or conversely, revealed that L-3's price was indeed competitive.

What is the track record of L-3 Communications Display Systems with the Department of Defense?

L-3 Communications Display Systems (now part of L3Harris Technologies) has a significant history of contracting with the Department of Defense. The data shows this specific contract was awarded in 2000 and completed in 2011, spanning over a decade. This long-term engagement suggests a consistent ability to meet DoD requirements. Historically, L-3 has been a major supplier of various defense electronics, communication systems, and avionics, indicating a substantial and established presence within the defense industrial base.

What were the potential risks associated with this long-term, sole-source contract?

The primary risks associated with this long-term, sole-source contract include potential cost inefficiencies, as there was no competitive pressure to ensure the lowest possible price. There's also a risk of technological obsolescence; over the contract's 11-year duration, newer communication technologies may have emerged, but the government was locked into the original awardee's solution. Furthermore, sole-source awards can reduce transparency and create a dependency on a single supplier, potentially limiting future flexibility and innovation.

What was the duration of the contract and how did it impact its overall value?

The contract had a duration of 3,971 days, which equates to approximately 10 years and 10 months, from its award date of August 29, 2000, to its completion date of July 14, 2011. This extended period allowed for a sustained supply of the necessary communication equipment. While a long duration can provide stability, it also increases the risk of the procured technology becoming outdated and the potential for the government to miss out on cost savings that might have been achieved through subsequent competitive re-procurements or technological advancements.

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 1355 BLUEGRASS LAKES PARKW, ALPHARETTA, GA, 07

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline