Department of the Navy awards $19.1M contract for SCADA modernization to MITOMO CO., LTD

Contract Overview

Contract Amount: $19,113,813 ($19.1M)

Contractor: Mitomo CO., Ltd.

Awarding Agency: Department of Defense

Start Date: 2025-06-16

End Date: 2028-04-06

Contract Duration: 1,025 days

Daily Burn Rate: $18.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: YSK-1805 SCADA MODERNIZATION

Plain-Language Summary

Department of Defense obligated $19.1 million to MITOMO CO., LTD. for work described as: YSK-1805 SCADA MODERNIZATION Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Firm Fixed Price contract type suggests defined scope and cost certainty. 3. Long duration of 1025 days indicates a significant, multi-year project. 4. No small business set-aside, potentially impacting small business participation. 5. Focus on SCADA modernization points to critical infrastructure upgrade needs. 6. Contractor has a single award, suggesting limited prior federal contracting history for this specific entity.

Value Assessment

Rating: questionable

Benchmarking the value of this $19.1 million contract is challenging without detailed scope and comparable projects. The sole-source nature raises concerns about whether the government secured the best possible price. The firm fixed-price structure, however, provides cost certainty for the government, assuming the scope is well-defined and the contractor's pricing is reasonable. Further analysis would require understanding the specific SCADA systems being modernized and the associated labor and material costs.

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 significantly limits the opportunity for multiple vendors to bid, which can reduce price discovery and potentially lead to higher costs for the government. The justification for a sole-source award would need to be thoroughly reviewed to understand why full and open competition was not feasible.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from the competitive pricing that typically drives down costs in government procurement. This can result in a less efficient use of taxpayer funds.

Public Impact

The Department of the Navy will benefit from modernized SCADA systems, enhancing operational efficiency and security. This contract supports critical infrastructure upgrades within naval facilities. The project's geographic impact is likely concentrated at the specific naval installations where the SCADA systems are located. Workforce implications may include specialized construction and technical labor for installation and integration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Lack of transparency in the sole-source justification could hide potential inefficiencies.
Long contract duration increases exposure to potential cost overruns if not managed tightly.
Absence of small business set-aside may limit opportunities for smaller firms.

Positive Signals

Firm Fixed Price contract provides cost certainty for the government.
Modernization of SCADA systems addresses critical operational and security needs.
Contract award indicates a commitment to upgrading essential infrastructure.

Sector Analysis

The SCADA (Supervisory Control and Data Acquisition) systems market is a critical segment within the industrial automation and control sector. This contract falls under commercial and institutional building construction, specifically focusing on the integration of advanced control systems. The overall market for SCADA systems is substantial, driven by the need for efficient monitoring and control of industrial processes across various sectors, including defense, energy, and utilities. This contract represents a specific investment in modernizing such systems within a federal defense context.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. This means that opportunities for small businesses to participate in this significant project are limited unless they are prime contractors or choose to subcontract independently. The absence of a set-aside may reduce the overall economic benefit to the small business ecosystem for this particular award.

Oversight & Accountability

Oversight for this contract will primarily fall under the Department of the Navy's contracting and program management offices. As a sole-source award, the justification and negotiation process would be subject to internal review and potentially oversight from the Government Accountability Office (GAO) if a protest is filed. Transparency regarding the specific justification for the sole-source award and the detailed scope of work would be key to assessing accountability.

Related Government Programs

Defense Infrastructure Modernization Programs
Naval Facility Modernization Contracts
SCADA System Procurement
Critical Infrastructure Protection Contracts

Risk Flags

Sole-source award may limit price competition.
Lack of small business participation opportunities.
Long contract duration requires diligent oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.1 million to MITOMO CO., LTD.. YSK-1805 SCADA MODERNIZATION

Who is the contractor on this award?

The obligated recipient is MITOMO CO., LTD..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $19.1 million.

What is the period of performance?

Start: 2025-06-16. End: 2028-04-06.

What is the specific justification for awarding this SCADA modernization contract on a sole-source basis?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are awarded when only one responsible source can provide the required supplies or services, or when there is a compelling urgency. For a contract of this magnitude ($19.1 million) and duration (1025 days), the justification would need to be robust, detailing why full and open competition was not feasible. This could involve unique technical requirements, proprietary technology, or specific contractor capabilities that cannot be replicated by others. Without this justification, it is difficult to assess the necessity of the sole-source approach and its potential impact on cost-effectiveness for the taxpayer.

How does the $19.1 million contract value compare to similar SCADA modernization projects within the Department of Defense?

Comparing the $19.1 million contract value to similar SCADA modernization projects within the Department of Defense is challenging without access to a broader dataset of comparable contracts. SCADA modernization projects can vary significantly in scope, complexity, and the specific systems being upgraded, leading to wide price ranges. Factors such as the size of the facility, the type of industrial processes being controlled, the level of integration required, and the specific technologies employed all influence cost. Given this is a sole-source award, it is particularly important to benchmark against other projects to ensure fair pricing, but such comparisons are difficult without detailed project specifications and market data.

What are the primary risks associated with a sole-source award for a critical infrastructure project like SCADA modernization?

The primary risks associated with a sole-source award for a critical infrastructure project like SCADA modernization include a lack of competitive pricing, which can lead to higher costs for the government and taxpayers. Without competition, there is less incentive for the contractor to offer the most cost-effective solution. Additionally, sole-source awards can reduce transparency and accountability, as the justification for bypassing competition may not always be fully scrutinized. There's also a risk that the government might not be aware of or have access to potentially superior or more innovative solutions that could have been offered by other vendors in a competitive bidding process. This can impact the overall value and effectiveness of the modernization effort.

What is the expected impact of this contract on the operational effectiveness and security of the Department of the Navy's facilities?

The expected impact of this contract on the operational effectiveness and security of the Department of the Navy's facilities is likely to be significant and positive. Modernizing SCADA systems is crucial for ensuring the reliable and secure operation of critical infrastructure, such as power grids, water treatment plants, and communication networks within naval bases. Upgraded SCADA systems typically offer enhanced monitoring capabilities, improved automation, better data analysis for predictive maintenance, and more robust cybersecurity features to protect against threats. This can lead to reduced downtime, optimized resource utilization, and a stronger defense against cyber-attacks, thereby enhancing overall mission readiness and operational continuity.

What is the historical spending pattern for SCADA modernization within the Department of the Navy or similar defense agencies?

Historical spending patterns for SCADA modernization within the Department of the Navy and similar defense agencies are generally characterized by ongoing investments in upgrading aging infrastructure and enhancing cybersecurity. These projects are often driven by obsolescence of existing systems, evolving technological capabilities, and increasing threats from cyber warfare. Spending can fluctuate based on budgetary priorities, specific modernization initiatives, and the identification of critical vulnerabilities. While specific aggregate spending figures are not readily available in this dataset, it is understood that defense agencies consistently allocate significant resources to maintaining and improving the control systems that underpin their operational capabilities.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3-30-2 AKUWANISHI, SEYA-KU, YOKOHAMA-SHI

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $19,113,813

Exercised Options: $19,113,813

Current Obligation: $19,113,813

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline