DoD's $15.8M order for ENVG-B prototypes awarded to L3 Technologies, Inc. without competition

Contract Overview

Contract Amount: $15,768,406 ($15.8M)

Contractor: L3 Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2018-05-31

End Date: 2021-12-31

Contract Duration: 1,310 days

Daily Burn Rate: $12.0K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: DELIVERY ORDER FOR THREE (3) ENVG-B SYSTEM PROTOTYPES AND UNIVERSAL HELMET MOUNT ASSEMBLIES (UHMA)

Place of Performance

Location: LONDONDERRY, ROCKINGHAM County, NEW HAMPSHIRE, 03053

State: New Hampshire Government Spending

Plain-Language Summary

Department of Defense obligated $15.8 million to L3 TECHNOLOGIES, INC. for work described as: DELIVERY ORDER FOR THREE (3) ENVG-B SYSTEM PROTOTYPES AND UNIVERSAL HELMET MOUNT ASSEMBLIES (UHMA) Key points: 1. The contract awarded to L3 Technologies, Inc. for ENVG-B system prototypes and helmet mounts represents a significant investment in advanced soldier technology. 2. The absence of competition for this delivery order raises questions about potential price discovery and value for money. 3. The fixed-price contract type offers some cost certainty, but the lack of competitive bidding limits benchmarking opportunities. 4. The delivery period spans over three years, indicating a substantial development and integration timeline for the prototypes. 5. The procurement falls under optical instrument and lens manufacturing, a specialized sector crucial for defense capabilities. 6. The contract's value, while substantial, needs to be assessed against the specific capabilities and technological advancements delivered by the ENVG-B system.

Value Assessment

Rating: questionable

The contract value of approximately $15.8 million for three prototype systems and associated assemblies is difficult to benchmark due to the sole-source nature of the award. Without competitive bids, it's challenging to determine if this price represents fair market value or if alternative solutions could have been procured at a lower cost. The fixed-price nature of the contract provides some cost control, but the lack of competition limits the ability to assess cost-effectiveness against industry standards or other potential suppliers.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a sole-source procurement, meaning it was not competed. This approach suggests that the Department of the Army identified L3 Technologies, Inc. as the only capable source for these specific ENVG-B system prototypes and universal helmet mount assemblies. The lack of competition means there were no other bidders, and therefore, no direct price comparison or negotiation leverage that typically arises from a competitive bidding process.

Taxpayer Impact: For taxpayers, a sole-source award means there is a reduced opportunity to benefit from cost savings that often result from competitive bidding. The government may not have secured the lowest possible price for these critical prototypes.

Public Impact

The primary beneficiaries of this contract are the soldiers who will eventually be equipped with the advanced ENVG-B systems, enhancing their situational awareness and combat effectiveness. The contract delivers three prototype ENVG-B systems and universal helmet mount assemblies, crucial for testing and evaluation of next-generation soldier technology. The geographic impact is primarily within the Department of Defense, specifically the Army, with potential future deployment across various Army units. Workforce implications include specialized roles in engineering, manufacturing, and testing within L3 Technologies, Inc. and potentially supporting industries.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Sole-source award limits transparency in pricing and value assessment.
Dependence on a single contractor for critical prototype development.
Potential for scope creep or cost overruns without competitive pressure.

Positive Signals

Award to a single, potentially specialized contractor can expedite development of advanced technology.
Fixed-price contract type provides some cost predictability.
Focus on delivering specific prototype systems for critical soldier enhancement.

Sector Analysis

The procurement falls within the optical instrument and lens manufacturing sector, a niche but critical area for defense technology. This sector is characterized by high research and development costs, specialized expertise, and often long product development cycles. The market size for advanced soldier systems is significant within the defense industry, driven by continuous efforts to enhance warfighter capabilities. This contract represents a specific investment in a key component of modern soldier modernization programs.

Small Business Impact

This contract was not awarded to a small business, nor does it appear to include specific small business set-aside provisions. The prime contractor, L3 Technologies, Inc., is a large defense contractor. There is no explicit information provided regarding subcontracting plans to small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, though large prime contractors often engage small businesses for various components and services.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Army's contracting and program management offices. Accountability measures are inherent in the fixed-price contract type, requiring delivery of specified prototypes. Transparency is limited due to the sole-source nature of the award, making public scrutiny of pricing and justification more challenging. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Enhanced Night Vision Goggles (ENVG)
Soldier Modernization Programs
Advanced Combat Systems
Department of Defense Research and Development Contracts
Optical and Electro-Optical Systems

Risk Flags

Sole-source award
Lack of competitive bidding
High per-unit prototype cost
Limited public cost-benefit analysis

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.8 million to L3 TECHNOLOGIES, INC.. DELIVERY ORDER FOR THREE (3) ENVG-B SYSTEM PROTOTYPES AND UNIVERSAL HELMET MOUNT ASSEMBLIES (UHMA)

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 $15.8 million.

What is the period of performance?

Start: 2018-05-31. End: 2021-12-31.

What is the specific technological advancement offered by the ENVG-B system compared to previous generations?

The ENVG-B (Family of Weapon Sights - Individual) system represents a significant leap in soldier-worn electro-optical technology. While specific details of the prototype's advancements are often proprietary, ENVG systems generally aim to provide soldiers with superior night vision, thermal imaging, and augmented reality capabilities integrated directly into their weapon sights and helmet-mounted displays. This allows for enhanced target acquisition, improved situational awareness in various lighting and weather conditions, and the ability to share sensor data. Compared to older generations, ENVG-B likely incorporates higher resolution sensors, improved image processing, reduced size and weight, and potentially more advanced networking and data fusion capabilities, enabling soldiers to 'see' more and react faster on the battlefield.

Why was this contract awarded on a sole-source basis, and what was the justification?

Sole-source awards are typically justified when only one responsible source is available or capable of meeting the government's requirements. For advanced technology prototypes like the ENVG-B system, this could be due to unique intellectual property, specialized manufacturing capabilities, prior development investment by the contractor, or specific integration requirements with existing platforms that only one company possesses. The Department of the Army would have conducted a market research analysis to determine if other companies could meet the need. If L3 Technologies, Inc. held patents, unique tooling, or had already invested heavily in developing the specific ENVG-B technology, it could lead to a sole-source justification, ensuring the government could acquire the desired system without extensive re-development or integration challenges by another firm.

How does the $15.8 million cost for three prototypes compare to similar advanced soldier system developments?

Benchmarking the cost of $15.8 million for three ENVG-B prototypes is challenging without detailed specifications and comparable programs. However, advanced soldier systems, especially those involving sophisticated optics, thermal imaging, and integrated electronics, are inherently expensive. Prototypes often carry a higher per-unit cost than production runs due to non-recurring engineering, specialized tooling, and limited production quantities. If these prototypes represent cutting-edge technology with significant R&D investment, the cost per unit (around $5.3 million) might be within the expected range for highly specialized defense prototypes. However, without access to detailed cost breakdowns or data from similar sole-source prototype awards, a definitive value-for-money assessment is difficult.

What are the potential risks associated with awarding a sole-source contract for critical soldier technology?

The primary risk of a sole-source award for critical soldier technology like the ENVG-B is the potential for inflated costs due to the lack of competitive pressure. The government may end up paying more than if the contract had been competed. Another risk is contractor complacency; without the threat of losing future business to competitors, the sole-source provider might be less motivated to innovate, control costs, or adhere strictly to delivery schedules. Furthermore, it can stifle broader industry innovation by limiting opportunities for other companies to develop and mature competing technologies. Dependence on a single supplier also creates a supply chain risk if that contractor faces financial difficulties or production issues.

What is L3 Technologies, Inc.'s track record with Department of Defense contracts, particularly in electro-optical systems?

L3 Technologies, Inc. (now part of L3Harris Technologies) has a substantial track record with the Department of Defense, holding numerous contracts across various defense sectors. They are well-known for their expertise in electro-optical and infrared (EO/IR) systems, including night vision devices, targeting pods, and sensor systems. Their history includes developing and supplying advanced technologies for various military branches. While specific details of past performance on similar ENVG-type systems would require deeper analysis of contract databases, L3Harris's overall portfolio indicates significant experience and capability in this domain, suggesting they are a qualified entity for such procurements.

What are the long-term implications for the Army's soldier modernization strategy if these ENVG-B prototypes are successful?

If the ENVG-B prototypes prove successful and meet or exceed expectations, it could significantly accelerate the Army's soldier modernization strategy. Successful prototypes pave the way for full-rate production and fielding, equipping soldiers with a critical technological advantage. This could lead to revised operational tactics, improved soldier survivability, and enhanced mission effectiveness. The success of this program might also influence future investments in integrated soldier systems, driving further innovation in areas like augmented reality, networked communications, and advanced sensing. Conversely, failure or significant delays could necessitate a re-evaluation of the strategy and potentially lead to seeking alternative solutions.

Industry Classification

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

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: $15,768,406

Exercised Options: $15,768,406

Current Obligation: $15,768,406

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W91CRB18D0003

IDV Type: IDC

Timeline