DoD awards $438M contract for computer and radar data to Northrop Grumman, with 7 years of performance

Contract Overview

Contract Amount: $438,315,692 ($438.3M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2019-09-23

End Date: 2029-05-13

Contract Duration: 3,520 days

Daily Burn Rate: $124.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: COMPUTER,RADAR DATA

Place of Performance

Location: MELBOURNE, BREVARD County, FLORIDA, 32904

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $438.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: COMPUTER,RADAR DATA Key points: 1. The contract value of $438.3 million over nearly 10 years suggests a significant investment in critical defense capabilities. 2. Awarded as 'NOT COMPETED', this raises questions about the extent of market research and potential for cost savings through competition. 3. The long performance period (2019-2029) indicates a sustained need for these services, but also a long-term commitment of funds. 4. The contract is for 'COMPUTER,RADAR DATA', a broad category that could encompass a range of services and technologies. 5. The primary contractor, Northrop Grumman Systems Corporation, is a major defense contractor, suggesting familiarity with complex defense requirements. 6. The contract's focus on data implies potential implications for data security, management, and utilization within the Department of Defense. 7. The geographic location of performance in Florida (FL) may indicate specific operational needs or existing infrastructure in that region.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without specific details on the 'COMPUTER,RADAR DATA' services provided. However, the substantial award amount over a long period warrants scrutiny. The lack of competition suggests that pricing may not have been subjected to market pressures, potentially leading to a higher cost than if multiple bids were solicited. Further analysis would require understanding the specific deliverables and comparing them to industry standards or similar sole-source procurements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification ('NOT COMPETED'). This means that only one contractor, Northrop Grumman Systems Corporation, was solicited. While sole-source awards can be appropriate in specific circumstances (e.g., unique capabilities, urgent needs), they limit price discovery and may not result in the best value for the government compared to a fully competed procurement. The absence of a competitive bidding process means potential savings from market forces were not realized.

Taxpayer Impact: Taxpayers may be paying a premium due to the lack of competition. Without bids from other qualified vendors, there is less assurance that the price reflects the most economical option available in the market.

Public Impact

The Department of Defense benefits from the acquisition of critical computer and radar data, essential for national security operations. This contract supports advanced technological capabilities, potentially enhancing intelligence gathering, surveillance, and reconnaissance efforts. The contract's performance in Florida may support regional defense infrastructure and associated employment. The workforce implications are likely concentrated within Northrop Grumman and its potential subcontractors, requiring specialized technical skills.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing and reduced value for taxpayer funds.
The broad scope of 'COMPUTER,RADAR DATA' could lead to scope creep or unfulfilled expectations if not clearly defined.
Long-term contract duration may not adapt well to rapidly evolving technological advancements in radar and computing.
Sole-source awards can stifle innovation by limiting opportunities for emerging or specialized technology providers.

Positive Signals

Award to a major defense contractor like Northrop Grumman suggests a high level of technical capability and experience.
The sustained funding over a long period indicates a consistent and critical need for the services provided.
The contract supports core defense missions, contributing directly to national security objectives.

Sector Analysis

This contract falls within the broader aerospace and defense sector, specifically focusing on data processing and potentially advanced sensor technologies. The market for defense-related data services is substantial, driven by the continuous need for intelligence and situational awareness. Comparable spending benchmarks would typically involve other large, sole-source or limited-competition contracts for specialized data analysis, software development, or sensor integration within the DoD. The size of this award is significant, placing it among major defense procurements.

Small Business Impact

The data indicates that small business participation was not a stated factor in this award (ss: false, sb: false). As a sole-source contract awarded to a large prime contractor, there is a risk that subcontracting opportunities for small businesses may be limited or not actively pursued. Further investigation into Northrop Grumman's subcontracting plan would be necessary to assess the actual impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Defense, likely through the Defense Contract Management Agency (DCMA) and the Defense Contract Audit Agency (DCAA). Transparency is limited due to the sole-source nature of the award. Accountability measures would be defined in the contract terms and conditions, focusing on performance metrics and delivery schedules. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Defense Intelligence Systems
Radar Systems Modernization
Advanced Computing for Defense
Northrop Grumman Defense Contracts
Department of Defense Data Analytics

Risk Flags

Sole-source award lacks competitive pricing.
Potential for technological obsolescence over contract duration.
Broad scope of 'COMPUTER,RADAR DATA' may lack specificity.
Limited transparency due to non-competitive nature.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $438.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. COMPUTER,RADAR DATA

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $438.3 million.

What is the period of performance?

Start: 2019-09-23. End: 2029-05-13.

What specific types of computer and radar data are being procured under this contract, and what are their intended uses?

The contract description 'COMPUTER,RADAR DATA' is very broad. Without further details, it's impossible to specify the exact nature of the data. It could range from raw sensor feeds, processed intelligence, simulation data, or software supporting data analysis. The intended uses are likely related to intelligence, surveillance, reconnaissance (ISR), command and control, or operational planning within the Department of Defense. To understand the specific data types and uses, one would need to examine the contract's Statement of Work (SOW) or Performance Work Statement (PWS), which are typically not publicly available for sole-source awards of this nature.

What justification was provided for awarding this contract on a sole-source basis instead of through full and open competition?

The data indicates the contract was 'NOT COMPETED', implying a sole-source justification was used. Common justifications for sole-source awards include: only one responsible source exists (e.g., unique technology or capability), urgent and compelling needs where competition is not feasible, or specific circumstances outlined in federal acquisition regulations (FAR). For this contract, the specific justification would likely be documented in a Justification and Approval (J&A) document, which is often publicly accessible through sources like the Federal Business Opportunities (now SAM.gov) archive. Without reviewing the J&A, we can only speculate that Northrop Grumman may possess unique proprietary technology or data processing capabilities essential for the DoD's requirements.

How does the $438.3 million contract value compare to similar procurements for computer and radar data services within the DoD?

Comparing this $438.3 million contract value is difficult without knowing the precise scope of 'COMPUTER,RADAR DATA'. However, as a sole-source award to a major defense contractor over a nearly 10-year period, it represents a significant investment. Large-scale data processing, analysis, and integration contracts within the defense sector can easily reach hundreds of millions of dollars. If this contract involves advanced analytics, AI-driven insights from radar, or the development of specialized data infrastructure, the price point is not necessarily out of line with industry norms for such critical, long-term capabilities. However, the lack of competition prevents a direct market-based comparison of value.

What are the potential risks associated with a long-term, sole-source contract for data services?

Several risks are associated with this type of contract. Firstly, the lack of competition can lead to higher costs for taxpayers, as the government may not be getting the best possible price. Secondly, technological obsolescence is a risk; the 'COMPUTER,RADAR DATA' services or technologies might become outdated over the contract's 7-year performance period, yet the government remains obligated. Thirdly, contractor performance risk exists; if Northrop Grumman fails to deliver adequately, the government has limited immediate alternatives due to the sole-source nature. Finally, there's a risk of vendor lock-in, making it difficult and costly to switch providers or adopt new solutions in the future.

What is Northrop Grumman Systems Corporation's track record with similar DoD contracts, particularly those involving data and radar systems?

Northrop Grumman Systems Corporation is a major defense contractor with extensive experience in aerospace, defense electronics, and information systems. They are known for developing and producing advanced radar systems (e.g., for aircraft and ships), electronic warfare systems, and sophisticated data processing and analysis capabilities. They have a long history of supporting the Department of Defense across numerous programs, including intelligence, surveillance, and reconnaissance (ISR). While specific details of past data-related contracts are proprietary, their overall track record suggests they possess the technical expertise and infrastructure to handle complex data requirements. However, past performance does not guarantee future value, especially in sole-source situations.

How does this contract align with broader trends in defense spending related to data analytics, AI, and advanced sensor technologies?

This contract aligns with significant trends in defense spending. The DoD is heavily investing in leveraging data analytics, artificial intelligence (AI), and advanced sensor technologies to maintain a technological edge. Procurements like this, focused on 'COMPUTER,RADAR DATA', are crucial for developing and operationalizing these capabilities. The ability to collect, process, analyze, and act upon vast amounts of data from various sources, including radar, is central to modern warfare concepts like Joint All-Domain Command and Control (JADC2). This contract likely supports efforts to enhance situational awareness, improve decision-making speed, and develop more effective targeting and threat detection capabilities through advanced data utilization.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: SPRPA118QV223

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2000 W NASA BLVD, MELBOURNE, FL, 32904

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $2,193,207,675

Exercised Options: $2,193,207,675

Current Obligation: $438,315,692

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001915G0026

IDV Type: BOA

Timeline