DoD directs $47.8M sole-source L3Harris radios for Ukraine, bypassing competition

Contract Overview

Contract Amount: $47,795,938 ($47.8M)

Contractor: L3harris Global Communications, Inc.

Awarding Agency: Department of Defense

Start Date: 2021-09-15

End Date: 2022-04-13

Contract Duration: 210 days

Daily Burn Rate: $227.6K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: DIRECTED SOLE SOURCE PROCUREMENT OF HARRIS RADIOS FOR THE COUNTRY OF UKRAINE FMS: DX-B-UEF, ARP: EX21047.

Place of Performance

Location: ROCHESTER, MONROE County, NEW YORK, 14623

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $47.8 million to L3HARRIS GLOBAL COMMUNICATIONS, INC. for work described as: DIRECTED SOLE SOURCE PROCUREMENT OF HARRIS RADIOS FOR THE COUNTRY OF UKRAINE FMS: DX-B-UEF, ARP: EX21047. Key points: 1. Procurement was a directed sole-source award, limiting price discovery and potentially increasing costs. 2. The contract value of $47.8 million is significant for specialized communications equipment. 3. Awarded to L3Harris Global Communications, Inc., a known entity in defense communications. 4. Delivery order for Ukraine FMS indicates a critical, time-sensitive need. 5. The contract duration of 210 days suggests a focused, short-term requirement. 6. Lack of competition raises questions about value for money and taxpayer risk. 7. The 'Other Communications Equipment Manufacturing' NAICS code suggests specialized, non-standard equipment.

Value Assessment

Rating: questionable

Benchmarking the value for this specific directed sole-source award is challenging due to the lack of competitive bids. However, the $47.8 million price tag for radios, even specialized ones, warrants scrutiny. Without competitive proposals, it's difficult to ascertain if the price reflects fair market value or if taxpayers are bearing a premium. The absence of a benchmark price or comparison to similar contracts makes a definitive value assessment difficult, but the sole-source nature inherently introduces risk.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was a directed sole-source procurement, meaning competition was explicitly bypassed. The justification for this approach is not detailed in the provided data, but it typically implies a unique capability, urgent need, or lack of other qualified sources. The absence of multiple bidders means there was no opportunity for price negotiation or comparison, which can lead to higher costs for the government.

Taxpayer Impact: Taxpayers may have paid a higher price than if the contract had been competed. The lack of transparency in pricing due to sole-sourcing reduces accountability.

Public Impact

The primary beneficiaries are the Ukrainian armed forces, receiving critical communication equipment. The services delivered are the provision of specialized radio equipment. The geographic impact is focused on Ukraine, supporting its defense capabilities. Workforce implications are likely within L3Harris, manufacturing and delivering the radios.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Directed sole-source awards reduce transparency and accountability.
Potential for overpayment without market-based price discovery.
Urgency of need may have overridden standard procurement best practices.

Positive Signals

Addresses a critical need for a partner nation.
Awarded to a known defense contractor with relevant expertise.
Fulfills a Foreign Military Sales (FMS) requirement.

Sector Analysis

The defense communications sector is characterized by high technological sophistication and significant government spending. Contracts often involve specialized equipment tailored to military requirements, with a limited number of prime contractors possessing the necessary expertise and security clearances. The market size for such specialized radios is substantial, driven by ongoing defense modernization and international security assistance programs. This contract fits within the broader category of defense electronics and communication systems, a critical component of national security spending.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to involve significant subcontracting opportunities for them based on the provided data. The award to a large prime contractor like L3Harris Global Communications, Inc. suggests that the primary focus was on fulfilling a specific, large-scale requirement rather than promoting small business participation. Without specific subcontracting plans, the direct impact on the small business ecosystem is likely minimal.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and financial management oversight mechanisms. Given it's a Foreign Military Sales (FMS) case, there are likely additional layers of oversight involving both the U.S. Department of State and the recipient nation's government. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse. Transparency is limited by the sole-source nature of the award.

Related Government Programs

Foreign Military Sales (FMS)
Department of Defense Communications Equipment Procurement
Ukraine Security Assistance
L3Harris Contracts

Risk Flags

Sole-source procurement
Lack of competition
Potential for inflated pricing
Urgent need justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $47.8 million to L3HARRIS GLOBAL COMMUNICATIONS, INC.. DIRECTED SOLE SOURCE PROCUREMENT OF HARRIS RADIOS FOR THE COUNTRY OF UKRAINE FMS: DX-B-UEF, ARP: EX21047.

Who is the contractor on this award?

The obligated recipient is L3HARRIS GLOBAL COMMUNICATIONS, 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 $47.8 million.

What is the period of performance?

Start: 2021-09-15. End: 2022-04-13.

What is the track record of L3Harris Global Communications, Inc. in fulfilling similar sole-source defense contracts, particularly for international partners?

L3Harris Global Communications, Inc. has a significant track record in providing advanced communication systems to military and government clients, both domestically and internationally. They are a frequent recipient of sole-source contracts, often justified by unique technological capabilities, existing system integration, or urgent operational requirements. For international partners, especially within NATO or allied nations, L3Harris has historically supplied radios and communication suites through various channels, including Foreign Military Sales (FMS). While specific data on prior sole-source radio procurements for Ukraine is not detailed here, their broader history suggests a capacity to deliver such specialized equipment under demanding conditions. However, the frequency of sole-source awards necessitates ongoing scrutiny to ensure fair pricing and competitive alternatives are considered whenever feasible.

How does the $47.8 million contract value compare to L3Harris's typical pricing for similar radio systems in competitive environments?

Directly comparing the $47.8 million value to L3Harris's competitive pricing for similar radio systems is challenging without access to detailed product specifications, quantities, and market benchmarks. Sole-source awards, by their nature, lack the price discovery mechanism inherent in competitive bidding. If this contract were competed, multiple vendors would submit proposals, allowing the government to compare prices and negotiate. The absence of competition means the government relies on L3Harris's proposed price, which may not reflect the lowest possible cost. Historical data on similar FMS procurements or domestic sales of comparable L3Harris radio systems, if available and adjusted for inflation and specific features, would be needed for a more robust comparison. However, the lack of competition inherently introduces a risk of a higher price point.

What specific risks are associated with a directed sole-source procurement of critical communication equipment for a partner nation in a conflict zone?

Directed sole-source procurements, especially for critical equipment in a conflict zone like Ukraine, carry several risks. Firstly, the lack of competition can lead to inflated prices, meaning taxpayer funds may not be used as efficiently as possible. Secondly, it bypasses the standard vetting process that competition provides, potentially overlooking alternative solutions or suppliers that might offer better value, faster delivery, or superior technology. Thirdly, reliance on a single source can create supply chain vulnerabilities. In a conflict zone, the urgency often cited for sole-sourcing can sometimes mask a lack of adequate planning or market research. Finally, it can set a precedent for future sole-source awards, potentially eroding competitive principles within defense procurement.

What is the expected program effectiveness and impact of these radios on Ukraine's defense capabilities, considering the procurement method?

The expected program effectiveness hinges on the radios meeting the specific operational requirements of the Ukrainian armed forces. L3Harris is a reputable provider of military-grade communication systems, suggesting the equipment itself is likely to be technologically sound and reliable. The primary impact will be enhancing battlefield communication, which is crucial for command and control, coordination, and overall operational effectiveness. However, the sole-source procurement method introduces a layer of uncertainty regarding the *value* delivered. While the equipment may be effective, the cost incurred might be higher than necessary. The urgency of the situation in Ukraine likely drove the decision to bypass competition, prioritizing rapid delivery of potentially life-saving communication tools over cost optimization, though this trade-off warrants careful consideration.

How does this $47.8 million expenditure fit into the broader historical spending patterns for communication equipment provided to Ukraine by the U.S. Department of Defense?

This $47.8 million expenditure represents a significant, albeit specific, component of the broader U.S. security assistance to Ukraine. Historical spending patterns for Ukraine have involved a wide array of military hardware, including Javelin missiles, HIMARS, drones, and various other support equipment. Communication systems are a critical, though sometimes less publicized, element of this aid. While specific figures for communication equipment alone are not readily available in this dataset, the total U.S. security assistance to Ukraine has amounted to tens of billions of dollars. This particular contract, focused on radios, fits within the category of essential tactical equipment needed to enhance Ukraine's operational capabilities. Its value is substantial in the context of communication systems but represents a fraction of the overall security aid package.

Industry Classification

NAICS: Manufacturing › Communications Equipment Manufacturing › Other Communications Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 1350 JEFFERSON RD, ROCHESTER, NY, 14623

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: $47,795,938

Exercised Options: $47,795,938

Current Obligation: $47,795,938

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W91CRB21D5003

IDV Type: IDC

Timeline