DoD awards $15.95M for Army's CENTAUR III sustainment and modernization to Raytheon Company

Contract Overview

Contract Amount: $15,951,261 ($16.0M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2024-07-08

End Date: 2025-08-08

Contract Duration: 396 days

Daily Burn Rate: $40.3K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: TASK ORDER W56KGY24F0006 IS ISSUED ON CROSS-DOMAIN ENTERPRISE ALL-SOURCE USER REPOSITORY (CENTAUR III) SUSTAINMENT & MODERNIZATION SERVICES.

Place of Performance

Location: RICHARDSON, COLLIN County, TEXAS, 75082

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $16.0 million to RAYTHEON COMPANY for work described as: TASK ORDER W56KGY24F0006 IS ISSUED ON CROSS-DOMAIN ENTERPRISE ALL-SOURCE USER REPOSITORY (CENTAUR III) SUSTAINMENT & MODERNIZATION SERVICES. Key points: 1. Contract awarded as a delivery order under an existing contract. 2. Focus on sustainment and modernization of the CENTAUR III system. 3. Cost Plus Fixed Fee pricing structure. 4. Contract duration of 396 days. 5. Performance located in Texas. 6. No small business set-aside indicated.

Value Assessment

Rating: fair

The contract value of $15.95 million for a 396-day period suggests a significant investment in sustainment and modernization. Without comparable contract data for the CENTAUR III system or similar enterprise repositories, a precise value-for-money assessment is challenging. The Cost Plus Fixed Fee (CPFF) structure can lead to cost overruns if not managed diligently, but it allows for flexibility in evolving modernization requirements. Benchmarking against other large-scale IT sustainment and modernization contracts would be necessary for a more robust comparison.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a delivery order under an existing contract and was not competed. The data indicates a 'NOT COMPETED' status, suggesting it was likely awarded on a sole-source basis or as a follow-on to a previous sole-source effort. The lack of competition means there was no opportunity for multiple vendors to bid, potentially limiting price discovery and the government's ability to secure the most competitive pricing.

Taxpayer Impact: The absence of competition for this significant award means taxpayers may not have benefited from the cost savings that could arise from a competitive bidding process.

Public Impact

The Department of the Army benefits from continued sustainment and modernization of its CENTAUR III system. Ensures the operational readiness and enhanced capabilities of a critical intelligence repository. Workforce in Texas will be engaged in high-tech engineering and sustainment services. Supports national security objectives by maintaining advanced intelligence infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost Plus Fixed Fee contract type carries inherent risk of cost escalation if not closely monitored.
Limited transparency into the specific modernization efforts and their expected outcomes.

Positive Signals

Award to Raytheon Company, a known defense contractor with extensive experience.
Focus on sustainment and modernization indicates a commitment to maintaining critical capabilities.
Delivery order structure suggests it's part of a larger, established program.

Sector Analysis

This contract falls within the Engineering Services sector, specifically related to IT infrastructure sustainment and modernization. The Department of Defense, particularly the Army, invests heavily in maintaining and upgrading complex data repositories and intelligence systems like CENTAUR III. The market for such services is dominated by large defense contractors with specialized expertise. Comparable spending benchmarks would involve looking at other large-scale IT modernization efforts within the DoD, which often run into tens or hundreds of millions of dollars.

Small Business Impact

The contract was not competed and there is no indication of a small business set-aside. This suggests that small businesses are unlikely to be direct recipients of this award. Subcontracting opportunities for small businesses may exist, but this is not explicitly stated and would depend on Raytheon's subcontracting plan. The overall impact on the small business ecosystem for this specific award appears minimal based on the provided data.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. As a delivery order under an existing contract, it inherits the oversight framework of the parent contract. Transparency is often limited for sole-source or non-competed awards. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse, but specific proactive oversight mechanisms are not detailed in the provided data.

Related Government Programs

Intelligence Information Systems
Defense Enterprise IT
Cloud Computing Services
Data Management Systems
Cybersecurity Services

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Lack of detailed modernization goals in provided data

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.0 million to RAYTHEON COMPANY. TASK ORDER W56KGY24F0006 IS ISSUED ON CROSS-DOMAIN ENTERPRISE ALL-SOURCE USER REPOSITORY (CENTAUR III) SUSTAINMENT & MODERNIZATION SERVICES.

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 $16.0 million.

What is the period of performance?

Start: 2024-07-08. End: 2025-08-08.

What is the historical spending on the CENTAUR III system by the Department of the Army?

Historical spending data for the CENTAUR III system is not directly provided in the given information. However, the issuance of a $15.95 million delivery order for sustainment and modernization suggests a significant ongoing investment. To understand historical spending patterns, one would need to access contract databases and search for previous awards related to CENTAUR III sustainment, modernization, or similar services provided by Raytheon Company or other contractors to the Department of the Army. Analyzing trends over several fiscal years would reveal the total investment and potential fluctuations in spending based on program needs and budget allocations.

How does the pricing structure (Cost Plus Fixed Fee) compare to industry standards for similar IT modernization contracts?

Cost Plus Fixed Fee (CPFF) is a common contract type in the federal government, particularly for research and development or services where the scope is not fully defined at the outset, allowing for flexibility. For IT modernization contracts, CPFF is often used when requirements are expected to evolve. While it offers flexibility, it carries a risk of cost overruns if not managed stringently, as the contractor is reimbursed for all allowable costs plus a fixed fee. Industry standards vary, but competitive bidding often favors Fixed Price contracts for well-defined scopes. When CPFF is used, robust government oversight and detailed cost tracking are crucial to ensure value for money and prevent excessive spending compared to what might be achieved under a fixed-price arrangement.

What are the specific modernization goals for the CENTAUR III system under this contract?

The provided data indicates the contract is for 'CENTAUR III SUSTAINMENT & MODERNIZATION SERVICES' but does not detail the specific modernization goals. These goals would typically be outlined in the contract's Statement of Work (SOW) or Performance Work Statement (PWS). Modernization efforts for an enterprise all-source user repository could encompass a wide range of improvements, such as enhancing data processing capabilities, upgrading security features, improving user interface and accessibility, integrating new data sources, migrating to cloud infrastructure, or increasing scalability and performance. Without access to the SOW/PWS, the precise objectives remain unspecified.

What is Raytheon Company's track record with the Department of Defense for similar IT sustainment and modernization contracts?

Raytheon Company, now part of RTX, is a major defense contractor with a substantial history of performing IT sustainment and modernization services for the Department of Defense (DoD). They have experience with large-scale enterprise systems, data management, and intelligence platforms. Their track record typically involves managing complex projects, adhering to security protocols, and delivering technological upgrades. Specific performance metrics and past issues related to similar contracts would require a deeper dive into contract performance reports, past performance evaluations, and potentially Inspector General reports, which are not included in the provided data.

What are the potential risks associated with a sole-source award for critical IT infrastructure like CENTAUR III?

The primary risk associated with a sole-source award for critical IT infrastructure like CENTAUR III is the potential for inflated costs due to the lack of competitive pressure. Without competing bids, the government may pay a premium compared to what could be achieved in an open market. Other risks include reduced innovation, as there's less incentive for the sole provider to explore novel solutions, and potential vendor lock-in, making it difficult and costly to switch providers in the future. Furthermore, a sole-source award can sometimes indicate a lack of market research or a failure to plan for competitive procurement, which can be a systemic risk.

How does the duration of this contract (396 days) align with typical sustainment and modernization cycles for enterprise IT systems?

A contract duration of 396 days (approximately 13 months) for sustainment and modernization of an enterprise IT system like CENTAUR III is relatively short for a complete overhaul but reasonable for a defined phase of work or a specific task order. Enterprise IT systems often require continuous sustainment and periodic modernization efforts that span multiple years. This 396-day period likely represents a specific increment of work, such as upgrading a particular module, enhancing a specific capability, or addressing immediate sustainment needs. Longer-term modernization strategies would typically involve multiple contract actions or longer-duration contracts.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1727 CITYLINE DR, RICHARDSON, TX, 75082

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: $15,951,261

Exercised Options: $15,951,261

Current Obligation: $15,951,261

Actual Outlays: $-17,257

Subaward Activity

Number of Subawards: 7

Total Subaward Amount: $3,831,381

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56KGY23D0005

IDV Type: IDC

Timeline