DoD awards $39.3M for DLA SPARES IBAS Block 2.8 Kits, a sole-source contract for circuit board manufacturing

Contract Overview

Contract Amount: $39,298,000 ($39.3M)

Contractor: DRS Network & Imaging Systems LLC

Awarding Agency: Department of Defense

Start Date: 2022-09-24

End Date: 2024-08-31

Contract Duration: 707 days

Daily Burn Rate: $55.6K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: DLA SPARES IBAS BLOCK 2.8 KITS AND INSTALLATION

Place of Performance

Location: MELBOURNE, BREVARD County, FLORIDA, 32935

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $39.3 million to DRS NETWORK & IMAGING SYSTEMS LLC for work described as: DLA SPARES IBAS BLOCK 2.8 KITS AND INSTALLATION Key points: 1. Contract awarded to DRS Network & Imaging Systems LLC for critical spare parts. 2. Sole-source award raises questions about price competition and potential for overpayment. 3. The contract duration of 707 days suggests a significant, ongoing need for these components. 4. Performance is located in Florida, potentially impacting local workforce and economy. 5. The NAICS code 334412 indicates a focus on bare printed circuit board manufacturing. 6. Fixed-price contract type aims to control costs, but competition level is a key factor.

Value Assessment

Rating: questionable

The contract value of $39.3 million for DLA SPARES IBAS Block 2.8 Kits and installation is substantial. Without competitive bidding, it is difficult to benchmark the value for money. The fixed-price nature of the contract provides some cost certainty, but the lack of competition means the government may not be achieving the lowest possible price. Further analysis would require comparison to similar sole-source procurements for electronic components or spare parts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, DRS Network & Imaging Systems LLC, was solicited. This approach bypasses the standard competitive bidding process. While sole-source awards can be justified under specific circumstances (e.g., urgency, unique capabilities), they limit price discovery and can lead to higher costs for the government. The absence of multiple bidders means there was no direct price competition to drive down the cost of the kits and installation.

Taxpayer Impact: Taxpayers may be paying a premium for these kits and installation due to the lack of competition. Without a competitive process, there is less assurance that the government secured the best possible price for these essential spare parts.

Public Impact

The Department of Defense, specifically the Defense Logistics Agency, benefits from the acquisition of critical spare parts for the IBAS system. The contract delivers essential kits and installation services, ensuring the operational readiness of military equipment. The geographic impact is concentrated in Florida, where the contract will be performed. Workforce implications may include employment opportunities for skilled labor in circuit board manufacturing and installation within Florida.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Lack of transparency in the procurement process due to non-competitive nature.
Dependence on a single contractor for critical spare parts could pose supply chain risks.
The specific nature of 'IBAS Block 2.8 Kits' suggests specialized components with potentially limited alternative sources.

Positive Signals

Fixed-price contract type provides cost certainty for the government.
Award to an established contractor (DRS Network & Imaging Systems LLC) may indicate reliability and existing expertise.
Contract duration suggests a sustained need, implying the importance of the supplied components for military operations.

Sector Analysis

This contract falls within the broader electronics and defense manufacturing sector, specifically focusing on bare printed circuit board manufacturing (NAICS 334412). The market for specialized military electronic components is often characterized by high barriers to entry, proprietary technology, and a limited number of qualified suppliers. Comparable spending benchmarks are difficult to establish without more detailed information on the specific components and their market value, especially given the sole-source nature of this award.

Small Business Impact

This contract does not appear to include a small business set-aside, as indicated by 'sb': false. There is no explicit mention of subcontracting goals for small businesses. Consequently, the direct impact on the small business ecosystem from this specific award is likely minimal. However, the prime contractor, DRS Network & Imaging Systems LLC, may engage small businesses as subcontractors, though this is not specified in the provided data.

Oversight & Accountability

Oversight for this contract will primarily fall under the Defense Logistics Agency (DLA) and the Department of Defense. Accountability measures are inherent in the fixed-price contract type, which obligates the contractor to deliver specified goods and services. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

DLA Spare Parts Procurement
Department of Defense Electronics Manufacturing
Military Communication Systems Components
Sole-Source Defense Contracts
Printed Circuit Board Manufacturing Services

Risk Flags

Sole-source procurement
Lack of competitive bidding
Potential for cost overruns
Supply chain dependency risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $39.3 million to DRS NETWORK & IMAGING SYSTEMS LLC. DLA SPARES IBAS BLOCK 2.8 KITS AND INSTALLATION

Who is the contractor on this award?

The obligated recipient is DRS NETWORK & IMAGING SYSTEMS LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $39.3 million.

What is the period of performance?

Start: 2022-09-24. End: 2024-08-31.

What is the track record of DRS Network & Imaging Systems LLC with the Department of Defense, particularly for sole-source contracts?

DRS Network & Imaging Systems LLC has a history of contracting with the Department of Defense. Analyzing their past performance, especially on sole-source awards, is crucial. Past performance evaluations, contract completion rates, and any history of disputes or overcharges on similar sole-source procurements would provide insight into their reliability and pricing practices. Without access to specific contract performance data and historical pricing for DRS, a definitive assessment is challenging. However, their continued engagement with the DoD suggests a level of capability and acceptance by the agency. Further investigation into publicly available contract awards and performance reviews could illuminate their track record.

How does the $39.3 million contract value compare to similar sole-source procurements for electronic components or spare parts within the DoD?

Benchmarking the $39.3 million value against similar sole-source procurements is challenging without specific details on the 'IBAS Block 2.8 Kits and Installation.' However, for specialized electronic components and spare parts, especially those with long lead times or proprietary technology, contract values can range significantly. Sole-source awards inherently lack direct price comparison, making value assessment difficult. If comparable sole-source contracts for similar complexity and quantity of electronic assemblies exist within the DoD, they would serve as a reference point. The absence of competition means the government relies on negotiation and justification from the sole provider, making historical pricing and market analysis critical for assessing value.

What are the specific risks associated with a sole-source award for critical military spare parts like these?

The primary risk of a sole-source award for critical military spare parts is the potential for inflated pricing due to the lack of competition. The government may not be achieving the best possible value for its investment. Another significant risk is contractor dependency; the reliance on a single supplier can create vulnerabilities in the supply chain, especially if the contractor faces production issues, financial instability, or decides to discontinue the product line. Furthermore, sole-source awards can reduce transparency in the procurement process, making it harder to scrutinize costs and ensure fair pricing. There's also a risk that innovation may be stifled as there is less incentive for the sole provider to improve efficiency or offer cost-saving alternatives.

What is the expected effectiveness of the IBAS Block 2.8 Kits and Installation in supporting military operations?

The IBAS (Interim Brigade Combat Team Advanced System) is a component of the U.S. Army's network-centric warfare strategy, designed to enhance situational awareness and command and control capabilities. The 'Block 2.8 Kits and Installation' likely represent upgrades or essential maintenance components for this system. Therefore, the effectiveness of these kits is directly tied to maintaining and enhancing the operational readiness and communication capabilities of the units equipped with the IBAS. Ensuring the timely delivery and proper installation of these spare parts is critical for the system's functionality, directly impacting the military's ability to conduct operations effectively in contested environments.

What are the historical spending patterns for DLA spare parts procurement, and how does this contract fit within that trend?

The Defense Logistics Agency (DLA) is a massive entity responsible for procuring and managing a vast array of spare parts and equipment for all branches of the U.S. military. Historical spending patterns for DLA spare parts procurement are characterized by high volume and significant dollar amounts, often involving complex supply chains and a mix of competitive and sole-source awards. This $39.3 million contract, while substantial, represents a fraction of DLA's overall annual spending. Its fit within the trend depends on the specific nature of the IBAS components; if they are highly specialized or legacy items, sole-source awards might be more common. However, the trend across DoD procurement is a push towards greater competition and cost-saving measures, making sole-source awards like this subject to closer scrutiny.

Are there any known issues or controversies related to the IBAS system or its components that might explain a sole-source award?

Information regarding specific controversies or issues directly linked to the 'IBAS Block 2.8 Kits' and necessitating a sole-source award is not readily available in the provided data. Sole-source justifications typically stem from factors such as unique technical requirements, proprietary technology, urgent needs where competition is impractical, or the existence of only one responsible source. Without the official justification for this sole-source award, it's speculative to pinpoint the exact reasons. However, complex military systems like IBAS often involve specialized, integrated components where a single manufacturer may hold the necessary intellectual property or production expertise, leading to sole-source situations.

Industry Classification

NAICS: Manufacturing › Semiconductor and Other Electronic Component Manufacturing › Bare Printed Circuit Board Manufacturing

Product/Service Code: WEAPONS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Leonardo SPA

Address: 100 N BABCOCK ST, MELBOURNE, FL, 32935

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $39,298,000

Exercised Options: $39,298,000

Current Obligation: $39,298,000

Subaward Activity

Number of Subawards: 84

Total Subaward Amount: $19,506,490

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: SPRRA220D0012

IDV Type: IDC

Timeline