DoD Awards $60M+ for Engineering Services to L3 Technologies, Inc. with Limited Competition

Contract Overview

Contract Amount: $60,147,033 ($60.1M)

Contractor: L3 Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2003-06-30

End Date: 2009-12-30

Contract Duration: 2,375 days

Daily Burn Rate: $25.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: 200310!000514!5700!GJ05 !WR-ALC/LRK !F0960403D0090 !A!N! !Y!0010 !20030630!20060630!008983355!008898884!008898843!N!L 3 COMMUNICATIONS CORPORATION!640 N 2200 W !SALT LAKE CITY !UT!84116!67000!035!49!SALT LAKE CITY !SALT LAKE !UTAH !+000004029402!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !C9E!ALL OTHER SUPPLIES AND EQUIPME!3000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!B!S! ! !D!20071031!B! ! !N!Z!D!N!R!1!001!N!6A!A!Y!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: SALT LAKE CITY, SALT LAKE County, UTAH, 84116

State: Utah Government Spending

Plain-Language Summary

Department of Defense obligated $60.1 million to L3 TECHNOLOGIES, INC. for work described as: 200310!000514!5700!GJ05 !WR-ALC/LRK !F0960403D0090 !A!N! !Y!0010 !20030630!20060630!008983355!008898884!008898843!N!L 3 COMMUNICATIONS CORPORATION!640 N 2200 W !SALT LAKE CITY !UT!84116!67000!035!49!SALT LAKE CITY !SALT LAKE !UTAH !+000004029402!N!N!000000000000!R414!SYSTEMS ENGI… Key points: 1. The contract awarded to L3 Technologies, Inc. is for Engineering Services, with a total value exceeding $60 million. 2. The procurement method was 'NOT COMPETED', indicating limited or no competition, which can impact price discovery. 3. The contract type is 'COST PLUS AWARD FEE', which can incentivize performance but also carries inherent cost risks. 4. The primary sector is Engineering Services (NAICS 541330), a critical area for defense operations.

Value Assessment

Rating: questionable

The contract value of $60,147,032.71 for engineering services needs further benchmarking against similar contracts. The Cost Plus Award Fee structure introduces variability in the final cost.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was not competed, suggesting potential limitations in the competitive process. This approach may not yield the best possible pricing for the government.

Taxpayer Impact: The lack of robust competition raises concerns about whether taxpayers received the best value for the $60M+ expenditure.

Public Impact

Significant taxpayer funds allocated for essential engineering services. Potential for increased costs due to limited competition and cost-plus contract type. Impact on national defense capabilities reliant on these engineering services. Need for transparency in how award fees are determined and justified.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition
Cost Plus Award Fee contract type
Lack of detailed cost breakdown (NOT DISCERNABLE OR CLASSIFIED)

Positive Signals

Award to established contractor (L3 Technologies, Inc.)
Services critical to Department of Defense operations

Sector Analysis

Engineering services are crucial for the Department of Defense, encompassing design, development, and testing of complex systems. Spending in this sector can vary widely based on defense priorities and technological advancements.

Small Business Impact

The data does not indicate any specific provisions or set-asides for small businesses in this contract award. Further analysis would be needed to determine if small businesses were involved as subcontractors.

Oversight & Accountability

The 'NOT COMPETED' status warrants scrutiny to ensure proper justification and adherence to procurement regulations. Oversight is needed to confirm the necessity of limited competition and the fairness of the pricing.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Lack of competition may lead to higher costs.
Cost Plus Award Fee structure can incentivize cost growth.
Limited transparency on specific services and cost breakdowns.
Long contract duration could mask inefficiencies.
Potential for contractor to maximize profit through award fees.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $60.1 million to L3 TECHNOLOGIES, INC.. 200310!000514!5700!GJ05 !WR-ALC/LRK !F0960403D0090 !A!N! !Y!0010 !20030630!20060630!008983355!008898884!008898843!N!L 3 COMMUNICATIONS CORPORATION!640 N 2200 W !SALT LAKE CITY !UT!84116!67000!035!49!SALT LAKE CITY !SALT LAKE !UTAH !+000004029402!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !C9E!ALL OTHER SUPPLIES AND EQUIPME!3000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!B!S! ! !D!20071031!B! ! !N!Z!D!N!R!1!001!N!6A!A!Y!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

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 Air Force).

What is the total obligated amount?

The obligated amount is $60.1 million.

What is the period of performance?

Start: 2003-06-30. End: 2009-12-30.

What specific engineering services were provided under this contract, and how do they align with the stated needs of the Department of the Air Force?

The contract specifies 'SYSTEMS ENGINEERING SERVICES' under NAICS code 541330. These services are generally broad and can include technical advice, analysis, and support for complex systems. Without further details on the specific tasks performed, it's difficult to definitively assess their alignment with the Air Force's precise requirements. However, the award suggests these services were deemed essential for ongoing operations or specific projects.

Given the limited competition, what measures were in place to ensure the 'Cost Plus Award Fee' structure resulted in a fair and reasonable price for the government?

The Cost Plus Award Fee (CPAF) structure inherently involves negotiation and oversight. The government likely established specific performance objectives and criteria for the award fee. However, the lack of competition means there was no baseline from other bidders to compare against. Robust government oversight, including detailed audits and performance evaluations, would be critical to ensuring the contractor's costs were reasonable and the award fee was justified.

How does the $60M+ expenditure for engineering services compare to typical spending benchmarks for similar services within the Department of Defense or the broader federal government?

Benchmarking this $60M+ expenditure requires access to a database of similar engineering services contracts. Factors like contract duration (nearly 6 years), scope of services, and specific agency needs influence pricing. Without comparative data, it's challenging to definitively state if this is high or low. However, large-value, long-duration contracts in specialized areas like defense engineering often represent significant investments.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: L-3 Communications Holdings, Inc. (UEI: 008898843)

Address: 640 N 2200 W, SALT LAKE CITY, UT, 84116

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: F0960403D0090

IDV Type: IDC

Timeline