DoD Awards $171.9M Sentinel Life Cycle Support Contract to Raytheon Company

Contract Overview

Contract Amount: $171,910,488 ($171.9M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2018-12-28

End Date: 2024-06-30

Contract Duration: 2,011 days

Daily Burn Rate: $85.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: THE PURPOSE OF THIS ACTION IS TO AWARD SERVICE IN SUPPORT OF SENTINEL LIFE CYCLE CONTRACTOR SUPPORT.

Place of Performance

Location: FULLERTON, ORANGE County, CALIFORNIA, 92834

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $171.9 million to RAYTHEON COMPANY for work described as: THE PURPOSE OF THIS ACTION IS TO AWARD SERVICE IN SUPPORT OF SENTINEL LIFE CYCLE CONTRACTOR SUPPORT. Key points: 1. Contract awarded to Raytheon Company for Sentinel Life Cycle Contractor Support. 2. Significant value of $171.9 million over its duration. 3. Contract type is Cost Plus Fixed Fee, indicating potential for cost overruns. 4. Engineering Services sector, NAICS 541330, suggests specialized technical support. 5. No small business participation noted.

Value Assessment

Rating: questionable

The Cost Plus Fixed Fee contract type can lead to higher costs than fixed-price contracts if not managed carefully. Benchmarking against similar engineering support contracts is difficult without more detailed cost breakdowns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, suggesting a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive process.

Taxpayer Impact: The lack of competition may result in the government paying more than necessary for these engineering services.

Public Impact

Taxpayers may be overpaying due to the sole-source nature of the award. The long duration (2018-2024) suggests critical, ongoing support for the Sentinel program. Lack of small business involvement means missed opportunities for smaller, innovative firms.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Cost Plus Fixed Fee contract type
No small business participation

Positive Signals

Essential life cycle support for a critical defense asset

Sector Analysis

This contract falls within the Engineering Services sector, which is crucial for the development, maintenance, and sustainment of complex defense systems like the Sentinel. Spending in this sector is often high due to the specialized nature of the work.

Small Business Impact

The contract data indicates no small business participation (sb: false). This suggests that the prime contractor, Raytheon Company, is handling the entirety of the work, potentially missing opportunities for subcontracting to smaller, specialized firms.

Oversight & Accountability

The 'st' field is 'CA', which might refer to a specific type of contract action or oversight mechanism within the Department of the Army. Further investigation into this code would clarify the oversight applied.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Sole-source award limits competition and price discovery.
Cost Plus Fixed Fee structure carries inherent risk of cost overruns.
No small business participation noted.
Long contract duration requires sustained oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $171.9 million to RAYTHEON COMPANY. THE PURPOSE OF THIS ACTION IS TO AWARD SERVICE IN SUPPORT OF SENTINEL LIFE CYCLE CONTRACTOR SUPPORT.

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 Army).

What is the total obligated amount?

The obligated amount is $171.9 million.

What is the period of performance?

Start: 2018-12-28. End: 2024-06-30.

What specific engineering services are being provided under this contract, and how do they contribute to the Sentinel program's operational readiness?

The contract is for 'Sentinel Life Cycle Contractor Support,' implying comprehensive services including maintenance, upgrades, logistics, and technical assistance throughout the Sentinel system's operational life. These services are critical for ensuring the platform remains effective, safe, and mission-capable against evolving threats.

Given the sole-source nature, what mechanisms are in place to ensure Raytheon Company is providing services at a fair and reasonable price?

As a Cost Plus Fixed Fee contract, the government pays the contractor's allowable costs plus a fixed fee representing profit. Oversight typically involves rigorous auditing of costs, negotiation of the fixed fee, and performance monitoring to ensure efficiency and prevent unnecessary expenditures.

What is the long-term strategy for the Sentinel program, and how does this contract align with future sustainment and modernization plans?

This contract covers support through June 2024, suggesting it's a key component of the current sustainment strategy. Future plans would likely involve follow-on contracts, potentially competitive, for continued sustainment, upgrades, or eventual replacement, depending on the program's lifecycle and modernization roadmap.

Industry Classification

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

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W31P4Q18R0016

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rockwell Collins Australia PTY Limited

Address: 1801 HUGHES DR, FULLERTON, CA, 92834

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: $232,379,253

Exercised Options: $171,910,488

Current Obligation: $171,910,488

Subaward Activity

Number of Subawards: 117

Total Subaward Amount: $34,555,728

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline