DoD awards $5.6M for two radar systems to SRCTEC, LLC, bypassing competition for Latvia's international program

Contract Overview

Contract Amount: $5,630,134 ($5.6M)

Contractor: Srctec, LLC

Awarding Agency: Department of Defense

Start Date: 2024-08-22

End Date: 2029-03-31

Contract Duration: 1,682 days

Daily Burn Rate: $3.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TWO (2) AN/TPQ-50 MMR RADAR SYSTEMS FOR INTERNATIONAL PROGRAM CUSTOMER LATVIA.

Place of Performance

Location: SYRACUSE, ONONDAGA County, NEW YORK, 13212

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $5.6 million to SRCTEC, LLC for work described as: TWO (2) AN/TPQ-50 MMR RADAR SYSTEMS FOR INTERNATIONAL PROGRAM CUSTOMER LATVIA. Key points: 1. Contract awarded without competition, raising questions about potential cost savings and best value. 2. The contract's value appears reasonable for specialized defense equipment, but a competitive benchmark is absent. 3. Limited competition increases the risk of overpayment and reduced innovation. 4. The delivery order is for a significant duration, spanning over four years. 5. SRCTEC, LLC is the sole awardee, indicating a potential single-source relationship or specialized capability. 6. The systems are intended for an international customer, highlighting the global reach of US defense procurement.

Value Assessment

Rating: questionable

The contract value of $5.6 million for two AN/TPQ-50 MMR RADAR SYSTEMS is difficult to benchmark due to the lack of competitive bidding. Without comparable contract data or market analysis, it's challenging to definitively assess if this represents excellent value for money. The fixed-price nature of the contract offers some cost certainty, but the absence of competition means potential savings from a bidding process are foregone. Further analysis would require understanding the specific capabilities and market price for these specialized radar systems.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This approach is typically used when only one responsible source can provide the required supplies or services. The lack of competition means that SRCTEC, LLC was the only entity considered for this award. This limits the government's ability to explore alternative solutions or negotiate prices based on multiple offers, potentially impacting the final cost and the range of available technological options.

Taxpayer Impact: Taxpayers may not be receiving the best possible price for these radar systems due to the absence of a competitive bidding process. Without competing offers, there is less pressure on the contractor to offer the lowest possible price.

Public Impact

The primary beneficiaries are the Latvian Armed Forces, who will receive advanced radar systems to enhance their defense capabilities. The contract delivers two AN/TPQ-50 MMR RADAR SYSTEMS, crucial for search, detection, and navigation. The geographic impact is primarily in Latvia, strengthening a NATO ally's military infrastructure. The contract supports the defense industrial base, potentially involving specialized manufacturing and technical expertise.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Sole-source award limits opportunities for other qualified vendors.
Long contract duration could introduce risks if technology or requirements change.

Positive Signals

Awarding to SRCTEC, LLC leverages a specific contractor's expertise for specialized equipment.
The fixed-price contract provides cost predictability for the government.
The systems are for an international partner, supporting foreign military sales and alliance strengthening.

Sector Analysis

The contract falls within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector, a niche within the broader defense industry. This sector is characterized by high technological complexity and significant R&D investment. Spending in this area is often driven by national security requirements and international cooperation. Comparable spending benchmarks are difficult to establish without more specific details on the radar system's capabilities and the market for such specialized equipment.

Small Business Impact

This contract does not appear to involve a small business set-aside, as SRCTEC, LLC is the prime contractor. There is no information provided regarding subcontracting plans or opportunities for small businesses within this award. The focus is on a direct award for specialized equipment, suggesting that larger, established defense contractors are likely involved in the supply chain.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and procurement regulations. The Army Contracting Command would be responsible for monitoring performance and ensuring compliance with the contract terms. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Foreign Military Sales Program
DoD Radar Systems Procurement
NATO Cooperative Programs
Defense Equipment Manufacturing

Risk Flags

Sole-source award
Lack of competitive pricing data
Potential for cost overruns without competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $5.6 million to SRCTEC, LLC. TWO (2) AN/TPQ-50 MMR RADAR SYSTEMS FOR INTERNATIONAL PROGRAM CUSTOMER LATVIA.

Who is the contractor on this award?

The obligated recipient is SRCTEC, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $5.6 million.

What is the period of performance?

Start: 2024-08-22. End: 2029-03-31.

What is the specific capability and technological advantage of the AN/TPQ-50 MMR RADAR SYSTEM?

The AN/TPQ-50 MMR (Medium-range Multi-mission Radar) is a counter-battery radar system designed to detect and track incoming artillery shells, rockets, and mortars. Its primary function is to provide early warning and accurate targeting information to friendly forces, enabling them to respond effectively. The 'MMR' designation suggests a multi-mission capability, potentially allowing it to perform other radar functions beyond counter-battery, such as air surveillance or target tracking. Its technological advantage lies in its ability to provide rapid and precise threat detection in complex battlefield environments, contributing significantly to force protection and operational effectiveness.

Why was this contract awarded on a sole-source basis instead of being competed?

Sole-source awards are typically justified under specific circumstances outlined in federal acquisition regulations, such as when only one responsible source can provide the required supplies or services, or when there is a compelling urgency. For specialized defense equipment like advanced radar systems, it's possible that SRCTEC, LLC holds unique intellectual property, patents, or possesses manufacturing capabilities that are not replicated by other companies. Alternatively, the government might have determined that the time required for a competitive solicitation and award would be detrimental to national security interests or the needs of the international partner (Latvia). A detailed justification for the sole-source award would be required by regulation.

How does the $5.6 million cost compare to similar radar system procurements, either domestically or internationally?

Benchmarking the $5.6 million cost for two AN/TPQ-50 MMR RADAR SYSTEMS is challenging without access to proprietary pricing data or a robust database of comparable international sales. Radar systems, especially those with advanced military specifications, can vary significantly in price based on their capabilities, range, accuracy, mobility, and integrated software. If this represents the cost for the systems alone, or if it includes training, support, and integration, will heavily influence the perceived value. Given the sole-source nature, a direct comparison to competitively bid systems is not feasible. However, for context, advanced military radar systems can range from hundreds of thousands to several million dollars each, depending on complexity.

What are the potential risks associated with awarding a contract of this magnitude on a sole-source basis?

The primary risk of a sole-source award is the potential for inflated pricing, as the government lacks the leverage of competitive bidding to drive down costs. There's also a risk of reduced innovation, as the awarded contractor may face less pressure to offer cutting-edge solutions or efficiencies. Furthermore, it can create a dependency on a single supplier, which could be problematic if that supplier experiences financial difficulties or supply chain disruptions. For taxpayers, the risk is not receiving the best possible value for their investment. The long contract duration also introduces risks related to technological obsolescence and changing geopolitical needs.

What is SRCTEC, LLC's track record with the Department of Defense, particularly concerning radar systems?

SRCTEC, LLC, based in New York, is a defense contractor specializing in radar and electronic warfare systems. While specific details of their past performance on DoD contracts for AN/TPQ-50 systems are not publicly detailed in this data, they have a history of supplying advanced radar technology. Their involvement in international programs suggests established relationships and capabilities recognized by the DoD. A comprehensive assessment would require reviewing their contract history, past performance evaluations, and any reported issues or successes with similar procurements.

What are the implications of this contract for US foreign policy and military alliances?

This contract signifies continued US support for the defense capabilities of its allies, specifically Latvia, a NATO member. By providing advanced radar systems, the US is helping to bolster Latvia's national security and its ability to contribute to collective defense efforts within NATO. Such procurements strengthen bilateral military ties and demonstrate a commitment to regional security. It also reinforces the US defense industrial base's role in supporting allied military modernization, potentially leading to interoperability benefits and shared security objectives.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5801 E TAFT RD STE 7, SYRACUSE, NY, 13212

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: $5,630,134

Exercised Options: $5,630,134

Current Obligation: $5,630,134

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $49,450

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56KGY23D0002

IDV Type: IDC

Timeline