DoD's $59.3M sole-source radio purchase for Ukraine highlights urgent needs over competition

Contract Overview

Contract Amount: $59,334,692 ($59.3M)

Contractor: L3harris Global Communications, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-05-04

End Date: 2022-11-30

Contract Duration: 210 days

Daily Burn Rate: $282.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: DIRECTED SOLE SOURCE ACQUISITION OF HARRIS GLOBAL COMMUNICATIONS RADIOS AND ACCESSORIES FOR THE COUNTRY OF UKRAINE.

Place of Performance

Location: ROCHESTER, MONROE County, NEW YORK, 14623

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $59.3 million to L3HARRIS GLOBAL COMMUNICATIONS, INC. for work described as: DIRECTED SOLE SOURCE ACQUISITION OF HARRIS GLOBAL COMMUNICATIONS RADIOS AND ACCESSORIES FOR THE COUNTRY OF UKRAINE. Key points: 1. Acquisition prioritized rapid delivery of essential communication tools to a partner nation in crisis. 2. Sole-source nature suggests limited market alternatives or specific interoperability requirements. 3. Contract duration of 210 days indicates a focused, short-term need. 4. The purchase falls under the 'Other Communications Equipment Manufacturing' NAICS code. 5. Delivery to New York suggests a staging or logistical hub for onward shipment. 6. No small business participation noted, typical for urgent, specialized foreign military sales.

Value Assessment

Rating: fair

Benchmarking the value of this specific acquisition is challenging due to its unique context as foreign military aid and the urgency of the situation. However, the firm fixed-price contract type provides some cost certainty. Without competitive bids or detailed cost breakdowns, a precise value-for-money assessment is difficult. The price appears to reflect the specialized nature of the equipment and the expedited delivery requirements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This acquisition was a directed sole-source purchase, meaning it was not competed. This approach was likely chosen to expedite the delivery of critical communication equipment to Ukraine during an active conflict, prioritizing speed and specific product availability over a competitive bidding process. The lack of competition means there was no opportunity for price discovery through market forces.

Taxpayer Impact: Taxpayers bear the full cost without the potential savings that competition might have offered. The justification for sole-source procurement in this instance appears to be driven by national security and foreign policy objectives rather than standard procurement efficiency.

Public Impact

The primary beneficiaries are the Ukrainian armed forces, receiving vital communication equipment. Essential communication services will be delivered to support military operations. The geographic impact is focused on Ukraine, with logistical support potentially originating from New York. Workforce implications are minimal within the US, primarily related to the manufacturing and logistics of the equipment by L3Harris.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition limits price transparency and potential cost savings for taxpayers.
Sole-source awards can sometimes lead to higher prices compared to competitive procurements.
Dependence on a single supplier for critical equipment can pose long-term supply chain risks.

Positive Signals

Rapid fulfillment of an urgent need for a key international partner.
Ensures delivery of specialized, potentially interoperable communication systems.
Firm fixed-price contract provides cost certainty for this specific order.

Sector Analysis

The defense communications sector is characterized by high technological sophistication and significant government investment. Companies like L3Harris are major players, often securing contracts through sole-source negotiations or competitive bids for specialized systems. This acquisition fits within the broader context of US foreign military sales and security assistance, where rapid deployment of critical capabilities is often prioritized, sometimes at the expense of traditional competitive procurement processes.

Small Business Impact

This contract was awarded directly to L3Harris Global Communications, Inc., and there is no indication of small business set-asides or subcontracting requirements. Urgent foreign military sales of specialized equipment often bypass small business participation goals due to the specific technical requirements and the need for rapid, direct procurement from established prime contractors.

Oversight & Accountability

As a Department of Defense contract, this acquisition is subject to oversight from the Department of Defense Office of Inspector General and potentially congressional committees. The justification for a directed sole-source award would typically be documented and reviewed to ensure compliance with procurement regulations, although the urgency of the situation may influence the extent of pre-award review.

Related Government Programs

Foreign Military Sales Program
Department of Defense Communications Equipment Procurements
Ukraine Security Assistance Initiative

Risk Flags

Sole-source justification
Urgent need procurement
Foreign military sales context

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $59.3 million to L3HARRIS GLOBAL COMMUNICATIONS, INC.. DIRECTED SOLE SOURCE ACQUISITION OF HARRIS GLOBAL COMMUNICATIONS RADIOS AND ACCESSORIES FOR THE COUNTRY OF UKRAINE.

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 $59.3 million.

What is the period of performance?

Start: 2022-05-04. End: 2022-11-30.

What is the specific type of Harris Global Communications radio and its intended use in Ukraine?

The data provided does not specify the exact model of Harris Global Communications radios. However, given the context of military operations in Ukraine, these are likely advanced tactical communication systems designed for secure, reliable voice and data transmission in challenging environments. They could include manpack radios, vehicular radios, or man-portable radios intended for use by infantry units, special forces, or command elements to maintain situational awareness and coordinate operations effectively. The 'Global Communications' designation suggests capabilities for long-range or networked communication.

Why was this acquisition deemed a directed sole-source acquisition rather than competed?

Directed sole-source acquisitions are typically justified when there is a compelling urgency, a lack of acceptable competitive alternatives, or when the acquisition is for a specific system that only one source can provide, often due to proprietary technology or existing infrastructure. In this case, the urgent need to equip Ukrainian forces during active conflict, coupled with the potential need for specific interoperability with existing systems or rapid availability from a known supplier like L3Harris, likely drove the sole-source decision. This prioritizes speed and immediate capability over the time-consuming process of competitive bidding.

How does the $59.3 million cost compare to similar DoD procurements for communication equipment?

Directly comparing this $59.3 million cost is difficult without knowing the exact quantity and specifications of the radios. However, for large-scale foreign military sales or domestic procurements of advanced tactical communication systems, this figure is within a plausible range. The DoD frequently procures communication suites costing tens to hundreds of millions of dollars. The 'fair' value assessment reflects the difficulty in benchmarking without competitive data, but the price is not inherently outside the expected spectrum for such specialized, urgent acquisitions.

What are the potential risks associated with a sole-source acquisition of critical communication equipment?

The primary risks of a sole-source acquisition include a lack of price competition, potentially leading to higher costs for the government. There's also a risk of reduced innovation if suppliers face less pressure to improve their offerings. Furthermore, reliance on a single supplier can create vulnerabilities in the supply chain, especially if that supplier faces production issues or geopolitical challenges. For this specific case, the risk is mitigated by the urgency and the strategic importance of equipping Ukraine, but long-term sustainment and future upgrades might require careful planning.

What is L3Harris Global Communications, Inc.'s track record with the Department of Defense and foreign military sales?

L3Harris Technologies (formed by the merger of L3 Technologies and Harris Corporation) is a major defense contractor with a long history of providing advanced communication systems, electronic warfare equipment, and other defense technologies to the U.S. Department of Defense and allied nations. They are a frequent recipient of DoD contracts, including those for tactical radios, satellite communications, and networking solutions. Their involvement in foreign military sales is extensive, supporting numerous international partners with critical defense capabilities, making them a well-established and experienced supplier for such urgent requirements.

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: $59,334,692

Exercised Options: $59,334,692

Current Obligation: $59,334,692

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W91CRB21D5003

IDV Type: IDC

Timeline