DoD Awards BAE Systems $21.6M for AN/ARC-231 System Software Support

Contract Overview

Contract Amount: $21,627,414 ($21.6M)

Contractor: BAE Systems Information and Electronic Systems Integration Inc.

Awarding Agency: Department of Defense

Start Date: 2022-06-09

End Date: 2027-02-08

Contract Duration: 1,705 days

Daily Burn Rate: $12.7K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: THE PURPOSE OF THIS TASK ORDER (TO) IS TO PROVIDE TECHNICAL AND ENGINEERING SERVICES IN SUPPORT OF SOFTWARE ENHANCEMENTS, TESTING, STUDIES, EXPERT SERVICES, AND DOCUMENTATION REVISIONS FOR THE AN/ARC-231 SYSTEM.

Place of Performance

Location: FORT WAYNE, ALLEN County, INDIANA, 46818

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $21.6 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC. for work described as: THE PURPOSE OF THIS TASK ORDER (TO) IS TO PROVIDE TECHNICAL AND ENGINEERING SERVICES IN SUPPORT OF SOFTWARE ENHANCEMENTS, TESTING, STUDIES, EXPERT SERVICES, AND DOCUMENTATION REVISIONS FOR THE AN/ARC-231 SYSTEM. Key points: 1. Contract focuses on software enhancements, testing, and documentation for the AN/ARC-231 system. 2. BAE Systems is the sole awardee, raising questions about competition. 3. The contract spans nearly five years, indicating a long-term need for these services. 4. Spending is concentrated in the Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing sector.

Value Assessment

Rating: questionable

The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. Without comparable contracts, assessing the value for money is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This is a sole-source award, meaning there was no competition. This significantly limits price discovery and may result in a higher price than if multiple vendors had bid.

Taxpayer Impact: The lack of competition for this $21.6 million contract means taxpayers may not have received the best possible price.

Public Impact

Ensures continued operational readiness and modernization of critical communication systems. Supports advanced software features and testing for military communication hardware. Potential for cost increases due to sole-source nature of the award. Long-term engagement with BAE Systems for system sustainment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price discovery.
Cost Plus Fixed Fee contract type can incentivize higher costs.
Long contract duration increases exposure to potential cost escalations.

Positive Signals

Addresses critical technical and engineering needs for a key system.
Ensures continuity of services for system enhancements and maintenance.

Sector Analysis

This contract falls within the Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing sector, specifically supporting military communication systems. Benchmarks for similar specialized engineering services for defense systems are difficult to ascertain without more specific data.

Small Business Impact

The awardee, BAE Systems, is a large business. There is no indication that small businesses were involved in this specific task order, either as prime contractors or subcontractors.

Oversight & Accountability

The sole-source nature of this award warrants close oversight to ensure the government is receiving fair value and that costs are managed effectively throughout the contract's duration.

Related Government Programs

Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Long contract duration
Lack of small business participation noted

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.6 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC.. THE PURPOSE OF THIS TASK ORDER (TO) IS TO PROVIDE TECHNICAL AND ENGINEERING SERVICES IN SUPPORT OF SOFTWARE ENHANCEMENTS, TESTING, STUDIES, EXPERT SERVICES, AND DOCUMENTATION REVISIONS FOR THE AN/ARC-231 SYSTEM.

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION 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 $21.6 million.

What is the period of performance?

Start: 2022-06-09. End: 2027-02-08.

What is the justification for awarding this contract on a sole-source basis, 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 a lack of other qualified sources. Without access to the specific justification documentation, it's impossible to detail the steps taken. However, agencies are generally required to perform price analyses, compare to historical data, or use other methods to ensure the price is fair and reasonable, even in sole-source situations.

What are the potential risks associated with a Cost Plus Fixed Fee contract for software development and engineering services?

Cost Plus Fixed Fee (CPFF) contracts carry risks for the government, primarily the potential for cost overruns. While the fee is fixed, the contractor is reimbursed for actual costs incurred. If costs escalate beyond initial estimates due to scope creep, inefficiencies, or unforeseen technical challenges, the total contract value can increase significantly, potentially exceeding the government's budget or the value derived from the services.

How does the long duration of this contract impact the government's ability to adapt to evolving technological requirements?

A long contract duration, like the 1705 days (approx. 4.6 years) for this task order, can pose a risk of technological obsolescence. While it provides stability, it may limit the government's agility to incorporate newer technologies or pivot to different solutions if requirements change rapidly. Flexibility clauses or regular reviews within the contract can mitigate this, but a lengthy commitment inherently reduces immediate adaptability.

Industry Classification

NAICS: Manufacturing › Communications Equipment Manufacturing › Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 5001 US HIGHWAY 30 W, FORT WAYNE, IN, 46818

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: $21,627,414

Exercised Options: $21,627,414

Current Obligation: $21,627,414

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56JSR19D0014

IDV Type: IDC

Timeline