DoD's $186M contract for communications-electronics services awarded to Harris Technical Services Corp. shows significant cost variance
Contract Overview
Contract Amount: $29,791,381 ($29.8M)
Contractor: Peraton Inc.
Awarding Agency: Department of Defense
Start Date: 2004-06-07
End Date: 2009-09-30
Contract Duration: 1,941 days
Daily Burn Rate: $15.3K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: TIME AND MATERIALS
Sector: IT
Official Description: 200410!005523!2100!W909MY!USA COMMUNICATIONS-ELECTRONICS !GS35F5202H !C!N! !Y!W909MY04F0048! !20040607!20050621!186006136!186006136!004203337!N!HARRIS TECHNICAL SERVICES CORP!1201 E ABINGDON DRIVE SUI!ALEXANDRIA !VA!22314!01000!510!51!ALEXANDRIA !ALEXANDRIA (CITY) !VIRGINIA !+000001198000!N!N!000000000000!R425!ENGINEERING TECHNICAL SERVICES !S1 !SERVICES !000 !* !238910!E! !6! ! ! ! ! !99990909!B!F!Y! ! !A! ! ! !000! ! ! ! ! ! ! !Y!C!N!N! ! ! ! ! ! !00 ! ! ! ! ! ! ! ! ! !0001! !
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20171
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $29.8 million to PERATON INC. for work described as: 200410!005523!2100!W909MY!USA COMMUNICATIONS-ELECTRONICS !GS35F5202H !C!N! !Y!W909MY04F0048! !20040607!20050621!186006136!186006136!004203337!N!HARRIS TECHNICAL SERVICES CORP!1201 E ABINGDON DRIVE SUI!ALEXANDRIA !VA!22314!01000!510!51!ALEXANDRIA !ALEX… Key points: 1. The contract's total value of $186,006,136 over its lifespan suggests a substantial investment in specialized technical services. 2. While awarded to Harris Technical Services Corp., the prime contractor listed is Peraton Inc., indicating a potential subcontracting or prime-sub relationship. 3. The contract's duration of 1941 days (over 5 years) points to a long-term need for these services within the Department of Defense. 4. The contract was awarded under full and open competition, suggesting a robust bidding process. 5. The use of 'TIME AND MATERIALS' pricing indicates that the final cost could fluctuate based on actual labor hours and material costs incurred. 6. The presence of a 'Delivery Order' award type suggests this contract may be part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle.
Value Assessment
Rating: questionable
Benchmarking this contract's value is challenging without specific details on the services rendered and the market rates for those specialized communications-electronics engineering technical services. The total award amount of $186,006,136 over approximately five years indicates a significant expenditure. However, the 'TIME AND MATERIALS' pricing structure introduces uncertainty regarding the final cost-effectiveness, as it is susceptible to variations in labor and material expenses. Without comparable contract data or a breakdown of labor categories and rates, a definitive value-for-money assessment is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'FULL AND OPEN COMPETITION,' which implies that all responsible sources were permitted to submit a bid. This suggests a competitive environment where multiple companies likely vied for the award. The number of bidders is not specified in the provided data, but the designation of full and open competition generally leads to better price discovery and potentially more favorable pricing for the government compared to sole-source or limited competition scenarios.
Taxpayer Impact: A full and open competition process is generally beneficial for taxpayers as it fosters a competitive environment, which can drive down prices and encourage innovation among contractors.
Public Impact
The primary beneficiaries are likely elements within the Department of Defense requiring advanced communications and electronics engineering support. The services delivered are categorized under 'ENGINEERING TECHNICAL SERVICES' and 'Custom Computer Programming Services,' indicating a focus on technical expertise and software development. The geographic impact is centered around Alexandria, Virginia, where the contractor Harris Technical Services Corp. is located, and potentially extends to wherever DoD communications-electronics operations are based. The contract supports a workforce skilled in engineering, technical services, and potentially custom software development within the defense sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The 'TIME AND MATERIALS' pricing model can lead to cost overruns if not carefully managed and monitored.
- The distinction between the awarded contractor (Harris Technical Services Corp.) and the listed prime contractor (Peraton Inc.) raises questions about the contractual structure and potential pass-through costs.
- Lack of specific performance metrics or deliverables in the provided data makes it difficult to assess the actual effectiveness and efficiency of the services provided.
- The contract's significant duration could indicate a long-term reliance that might warrant exploring more fixed-price or performance-based contracts for future procurements to better control costs.
Positive Signals
- Awarded under 'FULL AND OPEN COMPETITION,' suggesting a fair and transparent procurement process.
- The contract duration of over five years indicates a stable, long-term requirement, potentially leading to contractor efficiencies and specialized knowledge development.
- The contract supports critical defense functions related to communications and electronics, aligning with national security objectives.
- The award to a specific company suggests a recognized capability in providing the required engineering and technical services.
Sector Analysis
This contract falls within the Information Technology (IT) and Defense sectors, specifically focusing on engineering technical services and custom computer programming related to communications-electronics. The market for such specialized services within the defense industry is substantial, driven by the continuous need for advanced technological solutions. Comparable spending benchmarks would typically involve other large-scale IT and engineering support contracts awarded by the DoD or other federal agencies for similar complex systems integration and development.
Small Business Impact
The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications specifically related to small business set-asides for this particular award. The primary focus appears to be on large-scale prime contracting. Any involvement of small businesses would likely be through the prime contractor's own subcontracting decisions, which are not detailed here.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of Defense's contract management and oversight bodies, such as the Defense Contract Management Agency (DCMA), which is listed as the 'Servicing Agency Name'. Accountability measures would be tied to the terms and conditions of the contract, including performance standards and reporting requirements. Transparency is facilitated by the contract's award under full and open competition, making its existence public. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Defense Communications Systems
- Information Technology Services
- Engineering and Technical Services
- Custom Computer Programming
- Federal IT Procurement
- Department of Defense Contracts
Risk Flags
- Potential for cost overruns due to Time and Materials pricing.
- Unclear prime contractor vs. awarded contractor relationship.
- Lack of specific performance metrics in summary data.
- Long contract duration may mask inefficiencies.
Tags
department-of-defense, communications-electronics, engineering-services, it-services, custom-computer-programming, time-and-materials, full-and-open-competition, delivery-order, virginia, large-contract, defense-contract-management-agency
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $29.8 million to PERATON INC.. 200410!005523!2100!W909MY!USA COMMUNICATIONS-ELECTRONICS !GS35F5202H !C!N! !Y!W909MY04F0048! !20040607!20050621!186006136!186006136!004203337!N!HARRIS TECHNICAL SERVICES CORP!1201 E ABINGDON DRIVE SUI!ALEXANDRIA !VA!22314!01000!510!51!ALEXANDRIA !ALEXANDRIA (CITY) !VIRGINIA !+000001198000!N!N!000000000000!R425!ENGINEERING TECHNICAL SERVICES !S1 !SERVICES !000 !* !238910!E! !6! ! ! ! ! !999
Who is the contractor on this award?
The obligated recipient is PERATON INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $29.8 million.
What is the period of performance?
Start: 2004-06-07. End: 2009-09-30.
What specific types of communications-electronics engineering services were procured under this contract?
The contract data specifies 'ENGINEERING TECHNICAL SERVICES' and 'Custom Computer Programming Services' (NAICS 541511). This suggests a broad scope encompassing the design, development, integration, testing, and maintenance of complex communications and electronic systems. It could include areas like radio communications, satellite systems, network infrastructure, signal processing, cybersecurity for communications, and software development for command and control systems. Without a detailed statement of work, the precise nature of the services remains generalized, but the focus is clearly on high-level technical expertise within the defense communications domain.
How does the 'TIME AND MATERIALS' pricing structure impact the government's ability to control costs for this contract?
The 'TIME AND MATERIALS' (T&M) pricing structure allows the contractor to bill the government for the actual cost of labor hours expended and the materials used, plus a fixed fee or நிர்ணயிக்கப்பட்ட rate. While this can be flexible for requirements that are not well-defined upfront, it places a significant burden on the government to closely monitor and control labor hours and material costs to prevent overspending. Unlike fixed-price contracts, there is less incentive for the contractor to control costs, as higher costs directly translate to higher revenue. Effective oversight, detailed timesheets, and robust auditing are crucial to ensure value for money under a T&M contract.
What is the significance of Peraton Inc. being listed as the prime contractor while Harris Technical Services Corp. received the award?
The data lists 'PERATON INC.' as the prime contractor ('co') and 'HARRIS TECHNICAL SERVICES CORP' as the contractor receiving the award ('contractor name'). This discrepancy suggests a subcontracting relationship where Peraton Inc. may hold a master contract or IDIQ vehicle, and Harris Technical Services Corp. is performing the work under a delivery order issued against that master contract. Alternatively, there might be a corporate acquisition or a change in prime contractor status that is reflected differently in various data fields. Understanding the exact relationship is key to assessing responsibility and performance accountability.
What is the historical spending pattern for similar communications-electronics engineering services within the Department of Defense?
Historical spending on communications-electronics engineering services within the DoD is substantial and consistently high, reflecting the critical nature of these capabilities for national security. Agencies like the Defense Information Systems Agency (DISA) and various service branches (Army, Navy, Air Force) regularly procure services for network modernization, secure communications, electronic warfare systems, and command and control systems. Spending often occurs through large IDIQ contracts and specific delivery orders, with values frequently in the tens to hundreds of millions of dollars, similar to the scale of this contract. Trends show a continuous investment in upgrading legacy systems and adopting new technologies like 5G and AI-enabled communications.
Are there any specific performance risks associated with this contract based on the provided data?
Based solely on the provided data, specific performance risks are difficult to pinpoint. However, general risks associated with large, long-duration T&M contracts include potential cost overruns due to scope creep or inefficient labor utilization. The complexity of communications-electronics systems also presents inherent technical risks, such as integration challenges or obsolescence. The potential disconnect between the listed prime contractor (Peraton Inc.) and the awarded contractor (Harris Technical Services Corp.) could introduce administrative or communication risks if not managed properly. A thorough review of past performance and specific contract clauses would be needed for a comprehensive risk assessment.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Pricing Type: TIME AND MATERIALS (Y)
Contractor Details
Parent Company: L3harris Technologies, Inc (UEI: 004203337)
Address: 2235 MONROE ST, HERNDON, VA, 20171
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: GS35F5202H
IDV Type: FSS
Timeline
Start Date: 2004-06-07
Current End Date: 2009-09-30
Potential End Date: 2009-09-30 00:00:00
Last Modified: 2021-11-25
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