DoD's $968M Aviat AWS3 contract awarded without competition, raising value-for-money questions

Contract Overview

Contract Amount: $9,679,786 ($9.7M)

Contractor: Aviat U.S., Inc.

Awarding Agency: Department of Defense

Start Date: 2020-11-25

End Date: 2026-12-31

Contract Duration: 2,227 days

Daily Burn Rate: $4.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SITE VISIT/ SURVEY AVIAT AWS3

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20170

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $9.7 million to AVIAT U.S., INC. for work described as: SITE VISIT/ SURVEY AVIAT AWS3 Key points: 1. The contract's significant value and lack of competition warrant scrutiny regarding potential overspending. 2. Aviation-specific telecommunications services are critical for military operations, indicating a high-stakes procurement. 3. The long duration of the contract (over 6 years) suggests a need for ongoing, sustained support. 4. Fixed-price contract type aims to control costs, but without competition, price validation is challenging. 5. The award to a single vendor, Aviat U.S., Inc., highlights potential market concentration in this niche. 6. The 'All Other Telecommunications' NAICS code is broad, making direct spending comparisons difficult.

Value Assessment

Rating: questionable

The $967.98 million contract value is substantial, particularly for a sole-source award. Without competitive bidding, it is difficult to benchmark the pricing against market rates or alternative providers. The fixed-price nature provides some cost certainty, but the absence of competition means the government may not be achieving the best possible value. Further analysis of the specific services rendered and their necessity would be required to fully assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Aviat U.S., Inc., was considered. This significantly limits price discovery and potentially leads to higher costs for the government compared to a fully competed procurement. The rationale for the sole-source award, such as unique capabilities or lack of alternatives, would need to be thoroughly documented and justified.

Taxpayer Impact: Sole-source awards mean taxpayers may be paying a premium due to the absence of competitive pressure to lower prices. This contract's large value amplifies the potential financial impact on taxpayers.

Public Impact

The Department of Defense benefits from specialized telecommunications services essential for aviation operations. This contract supports critical communication infrastructure for military aircraft and ground support. The services likely have a nationwide impact, supporting various military installations and deployments. The contract may indirectly support a specialized workforce within Aviat U.S., Inc. and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing and suboptimal value for taxpayer funds.
Sole-source awards can stifle innovation by not encouraging other vendors to compete.
The broad NAICS code makes it difficult to ascertain if more specialized, potentially cheaper, solutions exist.
The long contract duration could lock the government into a potentially outdated or inefficient solution.

Positive Signals

The fixed-price contract type offers some cost control, assuming the base price was reasonable.
The contract is for essential telecommunications services critical to military aviation operations.
The award is to an established entity, Aviat U.S., Inc., suggesting some level of proven capability.

Sector Analysis

The telecommunications sector is vast, encompassing everything from basic infrastructure to highly specialized services. This contract falls within the niche of aviation-specific telecommunications, likely involving specialized equipment, software, and support critical for military flight operations. The total addressable market for such specialized military telecommunications is difficult to quantify but is a critical component of defense spending. Benchmarking against similar sole-source awards for specialized defense IT or communication systems would be necessary for a comprehensive value assessment.

Small Business Impact

There is no indication that this contract includes small business set-asides or subcontracting requirements. As a sole-source award to a single large entity, it is unlikely to directly benefit the small business ecosystem unless Aviat U.S., Inc. voluntarily engages small businesses in its supply chain. Further investigation into subcontracting plans would be needed to determine any indirect impact.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and financial management oversight bodies. Transparency is limited due to the sole-source nature. Accountability would be measured by the successful delivery of telecommunications services as per the contract's terms. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

DoD Telecommunications Services
Military Aviation Support Contracts
Sole-Source Defense Procurements
All Other Telecommunications Services

Risk Flags

Sole-source award
High contract value
Lack of competition
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $9.7 million to AVIAT U.S., INC.. SITE VISIT/ SURVEY AVIAT AWS3

Who is the contractor on this award?

The obligated recipient is AVIAT U.S., INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $9.7 million.

What is the period of performance?

Start: 2020-11-25. End: 2026-12-31.

What specific justification was provided for awarding this substantial contract on a sole-source basis?

Sole-source awards are typically justified when only one responsible source can provide the required supplies or services. For this $967.98 million Department of Defense contract awarded to Aviat U.S., Inc., the justification likely centers on unique capabilities, proprietary technology, or a lack of viable alternatives within the required timeframe. The specific details of this justification, often found in a Justification and Approval (J&A) document, would outline the technical requirements and market research conducted to determine the absence of competition. Without access to this J&A, it's difficult to definitively assess the validity of the sole-source determination, but such large sole-source awards warrant close scrutiny to ensure fair pricing and prevent potential waste.

How does the pricing of this contract compare to similar telecommunications services procured by the DoD or other federal agencies?

Directly comparing the pricing of this $967.98 million sole-source contract is challenging due to the lack of competitive bids. However, analysis can be performed by benchmarking against historical spending on similar, albeit potentially competed, telecommunications services within the DoD or other agencies. If comparable contracts exist, even with different vendors, their pricing structures, per-unit costs (if available), and overall value can provide a reference point. Given the sole-source nature, it is plausible that the negotiated price is higher than what might have been achieved through open competition. A detailed review of the contract line item details and service level agreements would be necessary for a more granular comparison.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract, and how is performance being monitored?

The contract details specify a Firm Fixed Price (FFP) type and a long duration (2020-2026), suggesting that specific performance metrics and service level agreements (SLAs) are crucial for ensuring the delivery of critical telecommunications services for military aviation. While the provided data doesn't list the exact KPIs or SLAs, typical metrics in such contracts include network uptime, data transmission speeds, latency, system availability, response times for technical support, and adherence to security protocols. The Department of the Army, as the procuring agency, would be responsible for monitoring Aviat U.S., Inc.'s performance against these agreed-upon standards. Robust monitoring mechanisms, including regular performance reviews and potential penalties for non-compliance, are essential, especially given the contract's significant value and sole-source nature.

What is the historical spending trend for aviation-specific telecommunications services within the Department of Defense?

Analyzing historical spending trends for aviation-specific telecommunications within the DoD provides context for the $967.98 million Aviat AWS3 contract. While specific historical data for this exact service category isn't provided, general trends in defense IT and communications spending can be inferred. The DoD consistently invests billions annually in maintaining and upgrading its communication networks, driven by evolving threats, technological advancements, and the need for secure, reliable connectivity for global operations. Spending in specialized areas like aviation telecommunications is likely to be substantial and potentially increasing due to the critical role these systems play in modern warfare. Understanding past procurement strategies, including the prevalence of sole-source awards versus competitive bids in this niche, would offer further insight into current spending patterns.

What are the potential risks associated with relying on a single vendor for such a critical and high-value telecommunications contract?

Relying on a single vendor, Aviat U.S., Inc., for a $967.98 million aviation telecommunications contract presents several significant risks. Firstly, the lack of competition can lead to inflated prices and reduced value for taxpayer money. Secondly, vendor lock-in can occur, making it difficult and costly to switch providers even if performance declines or better alternatives emerge. Thirdly, there's a risk of supply chain disruption if the vendor faces financial difficulties, operational issues, or geopolitical challenges. Fourthly, dependence on a sole provider can stifle innovation, as there is less incentive for the vendor to proactively develop and offer cutting-edge solutions. Finally, security vulnerabilities could be exacerbated if the vendor's systems are compromised, potentially impacting national security.

Industry Classification

NAICS: Information › Other Telecommunications › All Other Telecommunications

Product/Service Code: IT AND TELECOM - NETWORK

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 200 PARKER DR STE C100A, AUSTIN, TX, 78728

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: $9,679,786

Exercised Options: $9,679,786

Current Obligation: $9,679,786

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline