DoD's $24.4M Ophthalmic Goods Contract Awarded to Harris Corporation for 3 Years

Contract Overview

Contract Amount: $24,445,810 ($24.4M)

Contractor: Harris Corporation

Awarding Agency: Department of Defense

Start Date: 2008-05-28

End Date: 2011-07-29

Contract Duration: 1,157 days

Daily Burn Rate: $21.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: PY2 ENVG

Place of Performance

Location: ROANOKE, ROANOKE County, VIRGINIA, 24019

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $24.4 million to HARRIS CORPORATION for work described as: PY2 ENVG Key points: 1. Contract value represents a significant investment in specialized ophthalmic goods. 2. Competition dynamics suggest a potentially competitive bidding environment for this type of specialized manufacturing. 3. The fixed-price contract structure aims to control costs and provide predictability. 4. Performance duration of over three years indicates a sustained need for these goods. 5. The award to a single, established contractor warrants scrutiny for potential long-term value. 6. Sector positioning within Defense highlights the critical nature of these supplies for military readiness.

Value Assessment

Rating: fair

The contract value of $24.4 million over three years for ophthalmic goods manufacturing appears within a reasonable range for specialized defense procurement. However, without specific per-unit cost data or direct comparisons to similar, recent contracts for identical items, a definitive value-for-money assessment is challenging. The firm-fixed-price structure suggests an attempt to manage cost overruns, but the overall efficiency and cost-effectiveness would depend on the contractor's production capabilities and the specific technical requirements of the ophthalmic goods.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely solicited. The presence of two bids suggests a degree of competition, which is generally positive for price discovery and potentially for achieving better value. However, the specific number of bidders (two) is on the lower side for a full and open competition, which could imply that the market for this specialized manufacturing is limited or that other potential bidders did not find the opportunity sufficiently attractive.

Taxpayer Impact: A competitive bidding process, even with two bidders, is beneficial for taxpayers as it encourages contractors to offer more competitive pricing. This helps ensure that government funds are used efficiently and that the contract price reflects market realities rather than being inflated due to a lack of alternatives.

Public Impact

Military personnel requiring specialized ophthalmic equipment and supplies will benefit from this contract. The contract ensures the availability of critical vision-related goods for defense operations. The geographic impact is primarily national, supporting defense logistics and readiness across various military branches. Workforce implications include support for manufacturing jobs within the defense industrial base, specifically in the ophthalmic goods sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (two bidders) could potentially lead to higher prices than a more robust bidding environment.
The long-term nature of the contract might reduce flexibility if technology or needs change significantly.
Reliance on a single contractor for a critical supply chain component could pose a risk if performance issues arise.

Positive Signals

Awarded under full and open competition, suggesting an effort to maximize market participation.
Firm-fixed-price contract type provides cost certainty for the government.
Contractor's established presence in defense contracting may indicate reliability and experience.

Sector Analysis

The ophthalmic goods manufacturing sector is a niche but critical part of the broader healthcare and defense industrial base. This contract falls under the manufacturing of medical equipment and supplies, specifically focusing on vision-related products. The market size for specialized defense ophthalmic goods is difficult to quantify precisely but is driven by military readiness requirements and the unique specifications demanded by defense applications. Comparable spending benchmarks would typically be found within other defense contracts for medical devices and optical equipment, though direct comparisons are often limited by proprietary specifications.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' (small business subcontracting) is also false. This suggests that the primary contractor, Harris Corporation, is not obligated to meet specific small business subcontracting goals under this award. Consequently, the direct impact on the small business ecosystem for this particular contract is likely minimal, with opportunities for small businesses primarily arising if they are direct suppliers to Harris Corporation.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified goods. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected or reported during the contract's performance or closeout.

Related Government Programs

Department of Defense Medical Supplies
Ophthalmic Equipment Procurement
Defense Health Agency Contracts
Medical Manufacturing Contracts

Risk Flags

Limited Competition
Potential for Price Escalation (FFP Risk)
Long-Term Commitment

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.4 million to HARRIS CORPORATION. PY2 ENVG

Who is the contractor on this award?

The obligated recipient is HARRIS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $24.4 million.

What is the period of performance?

Start: 2008-05-28. End: 2011-07-29.

What is the historical spending pattern for ophthalmic goods by the Department of Defense?

Historical spending on ophthalmic goods by the Department of Defense (DoD) can be substantial, driven by the medical needs of service members and the operational requirements for specialized vision equipment. While specific aggregate data for 'ophthalmic goods' alone is not always readily available, it is often bundled within broader categories like 'medical equipment and supplies' or 'optical instruments.' Analyzing past contract awards for similar items reveals a consistent demand, with significant investments made over multiple fiscal years. For instance, prior awards for vision correction, protective eyewear, and diagnostic equipment for military personnel underscore a sustained commitment. The total spending fluctuates based on modernization efforts, troop deployment levels, and specific medical technology advancements. The $24.4 million awarded to Harris Corporation represents a portion of this ongoing investment, reflecting the continuous need for these critical supplies within the defense health system.

How does the price of these ophthalmic goods compare to commercial market rates?

Benchmarking the price of these ophthalmic goods against commercial market rates is challenging without detailed specifications of the items procured. Defense-specific ophthalmic goods often incorporate specialized features, materials, or durability standards that exceed those found in standard commercial products. These enhancements, such as resistance to extreme conditions, specific optical precision for tactical use, or integration with other military equipment, can significantly increase production costs. While the firm-fixed-price contract aims for cost efficiency, the unique requirements of military applications mean that direct price-to-price comparisons with civilian-grade equivalents may not be entirely accurate. A thorough analysis would require comparing the technical specifications and performance requirements of the contracted items against similar, albeit potentially less robust, commercial alternatives.

What is Harris Corporation's track record with similar defense contracts?

Harris Corporation, now part of L3Harris Technologies, has a substantial and long-standing track record of providing goods and services to the Department of Defense and other government agencies. Their portfolio includes a wide range of advanced technologies, communication systems, and electronic warfare capabilities. Within the realm of medical and optical equipment, Harris has historically been involved in supplying various components and systems. Their experience in defense contracting suggests a familiarity with stringent quality standards, complex procurement processes, and the operational demands of military applications. While specific details on their past performance for ophthalmic goods contracts of this exact nature would require deeper database analysis, their overall profile as a major defense contractor indicates a capacity to manage and deliver on such requirements, though performance can vary across individual contracts.

What are the potential risks associated with this contract award?

Several potential risks are associated with this contract award. Firstly, the limited competition, with only two bids received, could indicate a constrained market or potential barriers to entry for other qualified suppliers, which might lead to less favorable pricing over the contract's duration. Secondly, the firm-fixed-price (FFP) structure, while offering cost certainty, can pose a risk if unforeseen technical challenges or material cost escalations arise that are not adequately accounted for in the initial bid; the contractor might face financial strain or attempt to reduce quality to maintain profitability. Thirdly, the duration of the contract (over three years) means the government is committed for an extended period, potentially limiting its ability to adapt to rapidly evolving technological needs or to capitalize on more competitive pricing that might emerge later in the market. Finally, as with any single-source or limited-source award, there's an inherent risk of contractor performance issues, supply chain disruptions, or a decline in responsiveness over time.

How does this contract contribute to the overall readiness of the U.S. military?

This contract directly contributes to the overall readiness of the U.S. military by ensuring the supply of essential ophthalmic goods. These goods are critical for maintaining the vision health and operational effectiveness of service members across all branches. This includes providing corrective lenses, protective eyewear, and potentially diagnostic equipment necessary for eye care. Proper vision is fundamental for performing a wide range of military duties, from operating complex machinery and engaging in combat to conducting reconnaissance and maintaining equipment. By securing a reliable supply of these specialized items, the Department of Defense mitigates risks associated with vision impairment impacting mission success and personnel safety. The contract ensures that service members have access to the necessary visual aids and protection, thereby supporting their ability to execute their duties effectively in diverse and demanding environments.

Industry Classification

NAICS: Manufacturing › Medical Equipment and Supplies Manufacturing › Ophthalmic Goods Manufacturing

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W91CRB05R0006

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: ITT Corporation (UEI: 001216845)

Address: 7635 PLANTATION RD, ROANOKE, VA, 24019

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $24,445,810

Exercised Options: $24,445,810

Current Obligation: $24,445,810

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W91CRB05D0012

IDV Type: IDC

Timeline