DoD Awards $32.8M for Engineering Services to Raytheon Company under Full and Open Competition

Contract Overview

Contract Amount: $32,835,371 ($32.8M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2012-04-06

End Date: 2013-04-30

Contract Duration: 389 days

Daily Burn Rate: $84.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SRP GEOGRAPHICAL CENTERS

Place of Performance

Location: COLORADO SPRINGS, EL PASO County, COLORADO, 80913, UNITED STATES OF AMERICA

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $32.8 million to RAYTHEON COMPANY for work described as: SRP GEOGRAPHICAL CENTERS Key points: 1. Significant contract value of $32.8 million awarded to a major defense contractor. 2. Full and open competition was utilized, suggesting a potentially competitive bidding process. 3. The contract duration is 389 days, indicating a medium-term project. 4. The specific engineering services (NAICS 541330) are critical for defense operations.

Value Assessment

Rating: fair

The award amount of $32.8M for engineering services is substantial. Benchmarking against similar contracts for specialized engineering support is difficult without more granular data on the specific services provided. However, the presence of competition suggests pricing was likely scrutinized.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which typically allows all responsible sources to submit offers. This method is designed to foster price discovery and ensure the government receives competitive pricing.

Taxpayer Impact: The use of full and open competition aims to maximize taxpayer value by encouraging multiple bids and potentially lowering the overall cost of the services.

Public Impact

Ensures critical engineering support for Department of the Army operations. Raytheon Company, a large defense contractor, will provide the services. The contract's success impacts the operational readiness of specific Army units. Transparency in the bidding process through full and open competition is maintained.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed service description makes precise value assessment challenging.
Potential for cost overruns if scope creep occurs.
Dependence on a single large contractor for critical services.

Positive Signals

Awarded through full and open competition.
Contract is firm fixed price, providing cost certainty.
Significant value indicates important project.

Sector Analysis

This contract falls within the Engineering Services sector, which is crucial for defense infrastructure and operational support. Spending in this sector can fluctuate based on geopolitical events and modernization needs. Benchmarks for similar large-scale engineering contracts are highly variable.

Small Business Impact

The contract was awarded to Raytheon Company, a large business. There is no indication that small businesses were involved as prime contractors or significant subcontractors in this specific award, which is common for large, complex defense contracts.

Oversight & Accountability

The Department of Defense and Department of the Army are responsible for oversight. The firm fixed-price nature of the contract provides some cost control, but monitoring performance and adherence to scope will be key for accountability.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Contract awarded to a single large entity.
Limited transparency on specific service details.
Potential for scope creep impacting final cost.
Dependence on contractor performance for critical functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.8 million to RAYTHEON COMPANY. SRP GEOGRAPHICAL CENTERS

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $32.8 million.

What is the period of performance?

Start: 2012-04-06. End: 2013-04-30.

What specific engineering services are included under NAICS code 541330 for this contract, and how do they align with current Army modernization priorities?

NAICS code 541330 encompasses 'Engineering Services,' which can range from architectural and engineering design to specialized consulting for military systems and infrastructure. For this contract, the specific services would detail the technical expertise required by the Army, potentially including areas like systems engineering, technical support for weapon platforms, or infrastructure development. Alignment with modernization priorities would depend on whether these services directly contribute to upgrading existing capabilities or developing new ones.

Given the $32.8M award value and firm fixed-price structure, what is the estimated profit margin for Raytheon Company, and how does it compare to industry averages for defense engineering contracts?

Estimating the exact profit margin without knowing Raytheon's cost structure is speculative. However, firm fixed-price contracts typically aim for a balance where the contractor assumes risk for potential cost overruns in exchange for a potentially higher profit if costs are managed well. Industry averages for defense engineering contracts can vary, but profit margins often fall within the 7-15% range, influenced by contract complexity, competition, and specific service value.

What mechanisms are in place to ensure the quality and effectiveness of the engineering services provided by Raytheon, especially considering the 389-day duration?

Quality and effectiveness are typically ensured through performance metrics, delivery schedules, and acceptance criteria outlined in the contract. The Army will likely have contracting officers' representatives (CORs) or technical monitors to oversee Raytheon's performance, conduct regular reviews, and approve deliverables. For a 389-day contract, phased milestones and regular progress reports would be crucial for ongoing assessment and ensuring the services meet the required standards throughout the project lifecycle.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2603 CHALLENGER CT STE150, ORLANDO, FL, 32826

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $32,835,371

Exercised Options: $32,835,371

Current Obligation: $32,835,371

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W900KK07D0001

IDV Type: IDC

Timeline