DoD awards $33.1M contract for optical instruments to L3 Technologies, Inc. under sole-source justification

Contract Overview

Contract Amount: $33,121,440 ($33.1M)

Contractor: L3 Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-09-30

End Date: 2026-06-30

Contract Duration: 1,369 days

Daily Burn Rate: $24.2K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: F-PANO

Place of Performance

Location: TAUNTON, BRISTOL County, MASSACHUSETTS, 02780

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $33.1 million to L3 TECHNOLOGIES, INC. for work described as: F-PANO Key points: 1. Contract awarded on a sole-source basis, raising questions about potential price overruns and limited market engagement. 2. The fixed-price contract structure aims to control costs, but the lack of competition may hinder optimal value. 3. Performance period extends over three years, suggesting a need for sustained delivery of specialized optical equipment. 4. The award falls within the optical instrument manufacturing sector, indicating a focus on specialized defense capabilities. 5. No small business set-aside was applied, potentially limiting opportunities for smaller firms in this specialized market.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the sole-source award and lack of publicly available comparable pricing. The firm fixed-price structure provides some cost certainty, but without competitive bids, it's difficult to ascertain if the government secured the best possible price. The duration of the contract suggests a significant scope of work, and the absence of competition means the government relies heavily on L3 Technologies' pricing integrity.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning L3 Technologies, Inc. was the only vendor considered. The justification for this approach is not detailed in the provided data, but it typically implies that only one source is capable of meeting the requirement. This significantly limits price discovery and competitive pressure, potentially leading to higher costs for the government.

Taxpayer Impact: Taxpayers may be paying a premium for this contract due to the absence of a competitive bidding process. The lack of multiple offers means the government could not leverage competition to drive down prices.

Public Impact

The Department of the Army benefits from the acquisition of specialized optical instruments essential for its operations. This contract supports the delivery of advanced optical equipment, likely for surveillance, targeting, or reconnaissance purposes. The contract's geographic impact is primarily tied to the operations of the Department of the Army, wherever these instruments are deployed. Workforce implications may include specialized manufacturing and technical roles within L3 Technologies, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potentially increases costs for taxpayers.
Lack of transparency regarding the sole-source justification raises concerns about procurement fairness.
Absence of small business participation may limit opportunities for smaller, innovative firms in this sector.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to an established contractor like L3 Technologies, Inc. may indicate a reliance on proven capabilities.
Contract duration suggests a long-term need for these specialized optical instruments.

Sector Analysis

This contract falls within the Optical Instrument and Lens Manufacturing sector (NAICS 333314). This industry is characterized by high technological barriers to entry and often serves specialized markets, including defense, medical, and scientific research. The total federal spending in this sector can fluctuate based on defense procurement cycles and technological advancements. Comparable spending benchmarks are difficult to establish without more specific details on the type of optical instruments procured.

Small Business Impact

This contract was not set aside for small businesses, nor does it indicate any subcontracting requirements for small businesses. This means that opportunities for small businesses to participate in this specific procurement are likely minimal. The absence of small business involvement in sole-source awards can sometimes be a point of concern, as it may overlook potential contributions from smaller, agile companies within the sector.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. As a sole-source award, the justification and pricing are critical areas for review. Transparency is limited by the nature of the sole-source procurement, but internal DoD oversight mechanisms and potentially the Inspector General's office would be responsible for ensuring compliance and value for money.

Related Government Programs

Department of Defense Optical and Electro-Optical Systems Procurement
Army Intelligence, Surveillance, and Reconnaissance (ISR) Equipment
Advanced Manufacturing Contracts
Sole-Source Defense Procurements

Risk Flags

Sole-source award raises concerns about competition and potential overpricing.
Lack of detailed justification for sole-source award limits transparency.
No small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.1 million to L3 TECHNOLOGIES, INC.. F-PANO

Who is the contractor on this award?

The obligated recipient is L3 TECHNOLOGIES, 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 $33.1 million.

What is the period of performance?

Start: 2022-09-30. End: 2026-06-30.

What is the specific justification for awarding this contract on a sole-source basis to L3 Technologies, Inc.?

The provided data indicates the contract was awarded under a 'NOT COMPETED' (CT: NOT COMPETED) status, which is synonymous with a sole-source award. Specific justifications for sole-source procurements typically include reasons such as only one responsible source being available, urgent and compelling needs, or specific national security requirements that only a particular contractor can fulfill. Without further documentation from the Department of the Army, the precise rationale remains undisclosed in this dataset. Such justifications are crucial for ensuring fair competition and taxpayer value, and their absence in summary data limits a full assessment.

How does the $33.1 million contract value compare to historical spending on similar optical instruments by the Department of the Army?

Directly comparing this $33.1 million contract value to historical spending on 'similar' optical instruments is challenging without precise definitions of 'similar.' The Department of the Army procures a wide array of optical equipment, from basic binoculars to highly sophisticated targeting and surveillance systems. L3 Technologies, Inc. is a major defense contractor known for advanced systems. If this contract is for complex, high-technology optical systems, $33.1 million over approximately three years might be within a reasonable range for specialized, sole-source acquisitions. However, without knowing the exact nature of the instruments and the competitive landscape for those specific items, a definitive value comparison is not feasible.

What are the primary risks associated with a sole-source contract of this magnitude?

The primary risks associated with a sole-source contract of this magnitude ($33.1 million) include potential overpricing due to the lack of competitive pressure, reduced incentive for the contractor to innovate or improve efficiency, and a lack of transparency in the procurement process. Taxpayers may not receive the best value for their money. Furthermore, reliance on a single source can create supply chain vulnerabilities if the contractor experiences production issues or financial instability. The government also misses opportunities to foster competition and potentially discover new, more capable suppliers in the market.

What is the expected performance period and what does it imply about the nature of the optical instruments?

The contract has an estimated start date of September 30, 2022, and an estimated end date of June 30, 2026, resulting in a performance period of approximately 1,369 days (around 3.75 years). This extended duration suggests that the optical instruments being procured are not simple, off-the-shelf items. It implies a need for sustained production, potential integration into larger systems, ongoing support, or the delivery of complex, specialized equipment that requires significant manufacturing lead times and potentially development or customization.

Does L3 Technologies, Inc. have a track record with the Department of the Army for similar optical instrument contracts?

While the provided data confirms L3 Technologies, Inc. as the awardee, it does not detail their specific track record with the Department of the Army for similar optical instrument contracts. However, L3 Technologies (now part of L3Harris Technologies) is a well-established defense contractor with extensive experience in aerospace and defense electronics, including electro-optical and infrared systems. It is highly probable that they have a significant history of supplying various components and systems to the DoD, including the Army. A deeper dive into contract databases would likely reveal past performance and relevant experience.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Optical Instrument and Lens Manufacturing

Product/Service Code: FIRE CONTROL EQPT.

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 9 AKIRA WAY, LONDONDERRY, NH, 03053

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: $33,121,440

Exercised Options: $33,121,440

Current Obligation: $33,121,440

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W911QY22D0012

IDV Type: IDC

Timeline