Raytheon Company awarded $34M for Kuwait technical assistance, highlighting engineering services in defense

Contract Overview

Contract Amount: $34,001,969 ($34.0M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2010-12-16

End Date: 2015-12-31

Contract Duration: 1,841 days

Daily Burn Rate: $18.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: KUWAIT CONTRACTOR TECHNICAL ASSISTANCE

Place of Performance

Location: BILLERICA, MIDDLESEX County, MASSACHUSETTS, 01821

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $34.0 million to RAYTHEON COMPANY for work described as: KUWAIT CONTRACTOR TECHNICAL ASSISTANCE Key points: 1. Contract value of $34M for engineering services indicates significant investment in technical support. 2. The award to Raytheon Company suggests a focus on established defense contractors for critical support. 3. The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' competition type warrants further investigation into the exclusion rationale. 4. A contract duration of 1841 days points to a long-term need for these engineering services. 5. The 'Engineering Services' NAICS code (541330) positions this contract within a specialized sector of the economy. 6. The 'MASSACHUSETTS' state code suggests a potential concentration of related economic activity or contractor presence.

Value Assessment

Rating: fair

The contract value of $34 million for engineering services over approximately five years appears substantial. Benchmarking this against similar technical assistance contracts for overseas operations would be necessary for a precise value-for-money assessment. Without specific performance metrics or comparisons to industry standards for similar services, it is difficult to definitively assess if the pricing is competitive or represents excellent value. The fixed-price nature of the contract provides some cost certainty, but the overall value proposition depends heavily on the successful delivery and impact of the technical assistance provided.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This specific procurement method indicates that while the competition was intended to be open, certain sources were excluded. The rationale for this exclusion is not provided, which raises questions about the extent of true competition. Understanding why specific sources were excluded is crucial to determining if the competition level adequately served the government's interest in obtaining the best possible price and technical solution.

Taxpayer Impact: The exclusion of sources, even if justified, may limit the potential for broader competition, potentially impacting taxpayer value if more competitive bids were foregone. Transparency regarding the exclusion criteria is important for ensuring accountability.

Public Impact

The primary beneficiaries are likely the U.S. Department of Defense personnel and potentially allied forces in Kuwait requiring technical assistance. The services delivered are engineering support, crucial for the maintenance, operation, or enhancement of defense systems or infrastructure. The geographic impact is focused on Kuwait, supporting U.S. military operations or interests in the region. Workforce implications could include the deployment of specialized engineering personnel to the region, potentially impacting both military and civilian engineering roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of clarity on the 'exclusion of sources' in the competition process.
Potential for limited price discovery due to restricted competition.
Need for detailed performance metrics to fully assess value for money.
Geographic concentration of services in Kuwait may present logistical challenges.

Positive Signals

Award to a well-established contractor like Raytheon suggests a level of trust and proven capability.
The definitive contract type provides a framework for service delivery.
Fixed-price contract type offers cost predictability for the government.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting defense-related activities. The market for defense engineering services is substantial, driven by the ongoing need for technical expertise in maintaining and modernizing military equipment and infrastructure globally. Companies like Raytheon are major players in this sector, often competing for large, complex contracts that require specialized knowledge and security clearances. Benchmarking this contract's value would involve comparing it to other engineering support contracts awarded by the Department of Defense for similar operational environments or service scopes.

Small Business Impact

There is no indication from the provided data that this contract involved small business set-asides or significant subcontracting opportunities for small businesses. The award to a large prime contractor like Raytheon suggests that the primary focus was on specialized engineering capabilities, which may not always align with small business set-aside goals. Further investigation into subcontracting plans would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of Defense's contract management and inspection agencies, such as the Defense Contract Management Agency (DCMA). Accountability measures would be defined by the contract terms, including performance standards, reporting requirements, and payment schedules tied to deliverables. Transparency is generally maintained through contract databases and reporting, though specific operational details might be sensitive. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Defense Engineering Services
Foreign Military Support Contracts
Technical Assistance Contracts
Raytheon Company Contracts
Department of Defense Procurement

Risk Flags

Limited Competition Rationale Unclear
Potential for Cost Overruns in Fixed-Price Contracts with Long Durations
Geopolitical Risks in Operational Theater

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.0 million to RAYTHEON COMPANY. KUWAIT CONTRACTOR TECHNICAL ASSISTANCE

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $34.0 million.

What is the period of performance?

Start: 2010-12-16. End: 2015-12-31.

What was the specific justification for excluding certain sources in the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' procurement?

The provided data does not specify the exact reasons for excluding certain sources. This procurement method, while aiming for broad competition, allows for the exclusion of specific vendors based on predefined criteria, which could include national security concerns, lack of specific qualifications, or prior performance issues. To understand the justification, one would need to review the solicitation documents, pre-award justifications, and any official records related to the source exclusion process. Without this information, it's difficult to fully assess the impact on competition and potential cost savings for taxpayers.

How does the $34 million contract value compare to similar technical assistance contracts for overseas defense operations?

Benchmarking the $34 million contract value requires comparing it to similar contracts for technical assistance in overseas defense contexts. Factors such as the duration of the contract (1841 days, approximately 5 years), the specific services rendered (engineering support), and the geographic location (Kuwait) are critical for a meaningful comparison. Contracts for similar services in regions with comparable operational complexities or security environments would provide a relevant benchmark. Without access to a database of comparable contracts, it's challenging to definitively state whether this represents a high, low, or average cost. However, for long-term, specialized engineering support in a potentially demanding operational theater, the value appears substantial and warrants scrutiny against industry standards and historical data for similar engagements.

What are the key performance indicators (KPIs) associated with this contract, and how has Raytheon Company performed against them?

The provided data does not include specific Key Performance Indicators (KPIs) for this contract or Raytheon Company's performance against them. Typically, such KPIs would be detailed within the contract's statement of work and would relate to the quality, timeliness, and effectiveness of the engineering services provided. Performance assessments are usually documented through contract performance reports, contractor performance evaluation reports (CPARS), or internal agency reviews. To evaluate Raytheon's performance, one would need to access these post-award performance records. The absence of this information in the summary data limits the ability to assess the contractor's track record on this specific engagement.

What is the historical spending pattern for similar engineering services contracts by the Department of Defense in the Middle East region?

Analyzing historical spending patterns for similar engineering services contracts by the Department of Defense (DoD) in the Middle East region would reveal trends in investment and demand for such support. This would involve examining contract databases for awards related to engineering services, technical assistance, and base support over several fiscal years. Key metrics to track would include the total dollar amount awarded annually, the number of contracts issued, the primary contracting agencies, and the types of services most frequently procured. Understanding these patterns can help contextualize the $34 million award to Raytheon, indicating whether it aligns with or deviates from historical spending levels and identifying any shifts in procurement strategies or service needs within the region.

What are the potential risks associated with providing long-term engineering services in Kuwait, and how were they mitigated?

Providing long-term engineering services in Kuwait carries several potential risks, including geopolitical instability, logistical challenges, security threats to personnel and equipment, cultural and operational differences, and potential for cost overruns if not managed effectively. Mitigation strategies would typically involve comprehensive risk assessments during the planning phase, robust security protocols, contingency planning for unforeseen events, clear communication channels, and strong contract management oversight. The fixed-price nature of the contract might incentivize efficiency but could also pose a risk if unforeseen issues significantly increase costs beyond projections. The effectiveness of these mitigation strategies would be reflected in the project's successful execution and adherence to budget and schedule.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W31P4Q10R0079

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 350 LOWELL ST, ANDOVER, MA, 01810

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: $34,001,969

Exercised Options: $34,001,969

Current Obligation: $34,001,969

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline