DoD's $43.8M MK-99 PBL POP 2 Contract Awarded to Raytheon Company
Contract Overview
Contract Amount: $43,840,501 ($43.8M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2020-11-28
End Date: 2021-11-27
Contract Duration: 364 days
Daily Burn Rate: $120.4K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: MK-99 PBL POP 2
Place of Performance
Location: MARLBOROUGH, MIDDLESEX County, MASSACHUSETTS, 01752
Plain-Language Summary
Department of Defense obligated $43.8 million to RAYTHEON COMPANY for work described as: MK-99 PBL POP 2 Key points: 1. Significant contract value of $43.8 million for the MK-99 PBL POP 2 program. 2. Sole-source award to Raytheon Company indicates limited competition. 3. Potential risks associated with single-vendor reliance and price discovery. 4. Spending falls within the Ship Building and Repairing sector.
Value Assessment
Rating: questionable
The contract value of $43.8 million for the MK-99 PBL POP 2 is substantial. Without specific benchmarks for this particular system or comparable contracts, assessing its pricing reasonableness is difficult. The firm fixed-price structure offers some cost control, but the lack of competition raises concerns about optimal pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning there was no open competition. This significantly limits price discovery and may result in higher costs for taxpayers compared to a competitive procurement. The rationale for the sole-source award needs further examination.
Taxpayer Impact: The sole-source nature of this award raises concerns about potential overspending and the efficient use of taxpayer funds.
Public Impact
Taxpayers may be paying a premium due to the lack of competitive bidding. The Department of Defense relies on a single contractor, potentially limiting innovation and responsiveness. The specific capabilities and necessity of the MK-99 PBL POP 2 program warrant public understanding.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for inflated pricing
Positive Signals
- Firm fixed-price contract type
- Clear contract duration
Sector Analysis
This contract falls under the Ship Building and Repairing sector, a critical area for national defense. Spending in this sector can be substantial, and competitive procurement is typically encouraged to ensure value for money.
Small Business Impact
There is no indication that small businesses were involved in this sole-source award, suggesting a missed opportunity for small business participation and economic development.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny from oversight bodies to ensure the government received fair value and that the justification for not competing the contract was sound.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award limits competition and price discovery.
- Potential for higher costs due to lack of competitive pressure.
- Dependency on a single contractor creates strategic risk.
- No indication of small business participation.
Tags
ship-building-and-repairing, department-of-defense, ma, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $43.8 million to RAYTHEON COMPANY. MK-99 PBL POP 2
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $43.8 million.
What is the period of performance?
Start: 2020-11-28. End: 2021-11-27.
What is the justification for awarding this contract on a sole-source basis, and what steps were taken to ensure the best possible price was obtained?
The justification for a sole-source award typically involves factors such as unique capabilities, proprietary technology, or urgent needs that cannot be met through competition. Without specific documentation, it's impossible to confirm the exact reasons. However, agencies are expected to conduct market research and negotiate aggressively to secure the best possible price, even in sole-source situations, to mitigate the inherent risks of limited competition.
What are the long-term risks associated with relying solely on Raytheon Company for the MK-99 PBL POP 2 program?
Long-term reliance on a single supplier can lead to vendor lock-in, reduced innovation, and potential price increases over time as competition is absent. It also creates a vulnerability if the sole supplier faces production issues, financial instability, or decides to discontinue the product line. This dependency can limit the government's flexibility and bargaining power in future procurements.
How does the firm fixed-price contract structure mitigate risks for the government in this sole-source scenario?
A firm fixed-price (FFP) contract shifts the majority of the cost risk to the contractor. This means Raytheon Company is obligated to complete the work for the agreed-upon price, regardless of their actual costs. While this protects the government from cost overruns, it does not inherently guarantee a fair price, especially in a sole-source situation where the initial price might be inflated due to lack of competition.
Industry Classification
NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing
Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp (UEI: 001344142)
Address: 1001 BOSTON POST RD E, MARLBOROUGH, MA, 01752
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: $43,840,501
Exercised Options: $43,840,501
Current Obligation: $43,840,501
Subaward Activity
Number of Subawards: 13
Total Subaward Amount: $1,416,416
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: N0038320DW801
IDV Type: IDC
Timeline
Start Date: 2020-11-28
Current End Date: 2021-11-27
Potential End Date: 2021-11-27 00:00:00
Last Modified: 2021-12-13
More Contracts from Raytheon Company
- Federal Contract — $5.7B (Department of Defense)
- TEN Fire Units for Qatar — $5.6B (Department of Defense)
- GPS Advanced Control Segment (OCX) Phase B Blocks 1 and 2 — $4.5B (Department of Defense)
- An/Spy-6(v) Hardware Production — $3.3B (Department of Defense)
- Predominant - Patriot UAE — $3.0B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)