DoD Awards Raytheon $14M for ITAS CLS, Lacking Competition for 2025-2027
Contract Overview
Contract Amount: $14,086,348 ($14.1M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2025-07-01
End Date: 2027-03-01
Contract Duration: 608 days
Daily Burn Rate: $23.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: FOLLOW-ON OF CONTRACTOR LOGISTIC SUPPORT (CLS) TUBE-LAUNCHED OPTICALLY-TRACKED WIRELESS-GUIDED IMPROVED TARGET ACQUISITION SYSTEMS (ITAS) PROGRAM YEARS 2025-2027 (PY25-PY27)
Place of Performance
Location: MCKINNEY, COLLIN County, TEXAS, 75071
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $14.1 million to RAYTHEON COMPANY for work described as: FOLLOW-ON OF CONTRACTOR LOGISTIC SUPPORT (CLS) TUBE-LAUNCHED OPTICALLY-TRACKED WIRELESS-GUIDED IMPROVED TARGET ACQUISITION SYSTEMS (ITAS) PROGRAM YEARS 2025-2027 (PY25-PY27) Key points: 1. Contract value of $14.09M for 608 days of support. 2. Sole-source award to Raytheon Company for ITAS CLS. 3. Risk of inflated pricing due to lack of competition. 4. Engineering services sector, with PSC code 541330.
Value Assessment
Rating: questionable
The contract value of $14.09M for 608 days of support is difficult to assess without specific unit costs or detailed scope. However, the lack of competition raises concerns about potential overpricing compared to what might be achieved in a competitive environment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Raytheon Company. This limits price discovery and may result in higher costs for the government as there is no market pressure to offer competitive pricing.
Taxpayer Impact: The absence of competition could lead to taxpayers paying more than necessary for these critical engineering services.
Public Impact
Ensures continued logistical support for the ITAS program, vital for Army operations. Potential for higher costs due to sole-source nature impacts overall defense budget. Lack of competitive bidding may stifle innovation from other potential providers.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
Positive Signals
- Ensures continuity of essential services
- Firm fixed price contract type
Sector Analysis
This contract falls under Engineering Services (NAICS 541330), a sector often characterized by specialized expertise. Benchmarks for CLS contracts in this sector can vary widely based on system complexity and duration.
Small Business Impact
The data indicates this is a sole-source award to a large contractor, Raytheon Company. There is no indication of small business participation in this specific contract award.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure fair and reasonable pricing. Further oversight may be needed to justify the lack of competition and confirm value for taxpayer dollars.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Lack of competition
- Potential for price gouging
- Limited market research evident
- Dependency on incumbent contractor
Tags
engineering-services, department-of-defense, tx, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $14.1 million to RAYTHEON COMPANY. FOLLOW-ON OF CONTRACTOR LOGISTIC SUPPORT (CLS) TUBE-LAUNCHED OPTICALLY-TRACKED WIRELESS-GUIDED IMPROVED TARGET ACQUISITION SYSTEMS (ITAS) PROGRAM YEARS 2025-2027 (PY25-PY27)
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 $14.1 million.
What is the period of performance?
Start: 2025-07-01. End: 2027-03-01.
What is the justification for awarding this contract sole-source, and what steps were taken to ensure fair and reasonable pricing?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or the absence of other responsible sources. The government should have conducted a price analysis, potentially using historical data or cost breakdowns, to validate the reasonableness of the firm fixed price. Documentation of this analysis is crucial for accountability.
What are the long-term risks associated with repeatedly awarding sole-source contracts for CLS to the same vendor?
Long-term sole-source awards can lead to vendor lock-in, reduced innovation, and potentially escalating costs as competition is eliminated. It may also prevent the development of organic government capabilities or the emergence of alternative solutions from other companies, ultimately diminishing strategic flexibility and increasing reliance on a single entity.
How does the firm fixed price structure mitigate risks for the government in this sole-source scenario?
A firm fixed price (FFP) contract shifts most of the risk to the contractor, obligating them to complete the work for a predetermined price regardless of their actual costs. While this protects the government from cost overruns, it does not inherently guarantee a fair price, especially in a sole-source situation where the contractor may have less incentive to be cost-efficient.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W31P4Q24R0005
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp
Address: 2501 W UNIVERSITY DR, MCKINNEY, TX, 75071
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: $72,459,245
Exercised Options: $14,086,348
Current Obligation: $14,086,348
Actual Outlays: $1,154,918
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2025-07-01
Current End Date: 2027-03-01
Potential End Date: 2027-03-01 00:00:00
Last Modified: 2026-01-09
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