Homeland Security awards $50.3M for sustainment towers, with a significant portion for computer systems design

Contract Overview

Contract Amount: $50,268,326 ($50.3M)

Contractor: Anduril Industries, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2024-06-28

End Date: 2025-09-30

Contract Duration: 459 days

Daily Burn Rate: $109.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SUSTAINMENT TOWERS UNDER DO16

Place of Performance

Location: COSTA MESA, ORANGE County, CALIFORNIA, 92626

State: California Government Spending

Plain-Language Summary

Department of Homeland Security obligated $50.3 million to ANDURIL INDUSTRIES, INC. for work described as: SUSTAINMENT TOWERS UNDER DO16 Key points: 1. Contract value of $50.3M for sustainment towers indicates a substantial investment in border security technology. 2. The contract is for Computer Systems Design Services, suggesting a focus on integrated technological solutions. 3. A delivery order duration of 459 days points to a medium-term project with ongoing support needs. 4. The award to ANDURIL INDUSTRIES, INC. places a key technology provider in a critical national security role. 5. The contract's fixed-price nature aims to control costs and provide budget certainty for the agency. 6. The geographic focus on California suggests a specific operational need or deployment area for these towers.

Value Assessment

Rating: good

The contract value of $50.3 million for sustainment towers appears reasonable given the scope of computer systems design services required for border security. Benchmarking against similar technology procurements for surveillance and integrated systems suggests this falls within expected ranges. The firm fixed-price structure helps mitigate cost overruns, contributing to value for money. However, a more precise value assessment would require detailed cost breakdowns and comparisons to specific system functionalities.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES'. While this indicates some level of competition, the exclusion of certain sources suggests a specific justification was made, potentially limiting the breadth of competitive offers. The number of bidders is not explicitly stated, but the 'exclusion of sources' implies a more tailored competition than a completely open solicitation. This approach can sometimes lead to higher prices if the excluded sources represent significant competition.

Taxpayer Impact: The limited competition, due to the exclusion of sources, may mean taxpayers did not benefit from the lowest possible price that a fully open competition might have yielded. However, if the exclusion was justified by specialized capabilities, it could ensure the best-suited technology is acquired.

Public Impact

The primary beneficiaries are U.S. Customs and Border Protection, enhancing their operational capabilities at the border. The services delivered include the design and likely implementation of sustainment towers, crucial for surveillance and data management. The geographic impact is concentrated in California, indicating a specific area of enhanced border security operations. Workforce implications may include the need for specialized technical personnel for installation, maintenance, and operation of the systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if the chosen system is highly proprietary.
Dependence on a single contractor for critical sustainment and system design could pose risks.
The 'exclusion of sources' in the competition raises questions about the extent of true market competition.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to a known entity in the defense technology sector suggests potential for reliable performance.
The contract addresses a critical national security need for border surveillance.

Sector Analysis

The procurement falls within the broader IT and Defense technology sectors, specifically focusing on systems integration and design services for border security applications. The market for such solutions is competitive, with several established and emerging players offering advanced surveillance and data management technologies. This contract represents a significant investment in specialized hardware and software solutions designed to enhance physical and digital border monitoring capabilities. Comparable spending benchmarks in this area often relate to large-scale surveillance system upgrades and integrated command and control platforms.

Small Business Impact

The data indicates that small business participation (ss: false, sb: false) was not a primary set-aside consideration for this specific contract. This suggests the contract was likely awarded based on specialized capabilities and technical requirements that may be better met by larger, established firms. There is no explicit information on subcontracting plans for small businesses, which could be a missed opportunity to leverage the small business ecosystem for specific components or services.

Oversight & Accountability

Oversight for this contract would primarily fall under the U.S. Customs and Border Protection (CBP) within the Department of Homeland Security (DHS). Standard contract management processes, performance reviews, and financial audits would be in place. The Inspector General for DHS would have jurisdiction to investigate any potential fraud, waste, or abuse related to this award. Transparency is generally maintained through contract award databases, though specific performance metrics and detailed cost breakdowns may not always be publicly accessible.

Related Government Programs

Border Security Technology
Surveillance Systems
Information Technology Services
Department of Homeland Security Procurements
Computer Systems Design

Risk Flags

Limited competition due to source exclusion
Potential for vendor lock-in with specialized systems
Short contract duration for complex technology lifecycle

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $50.3 million to ANDURIL INDUSTRIES, INC.. SUSTAINMENT TOWERS UNDER DO16

Who is the contractor on this award?

The obligated recipient is ANDURIL INDUSTRIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $50.3 million.

What is the period of performance?

Start: 2024-06-28. End: 2025-09-30.

What is the track record of ANDURIL INDUSTRIES, INC. with Department of Homeland Security contracts, particularly for similar sustainment or surveillance systems?

Anduril Industries, Inc. has become a prominent player in the defense technology sector, known for its innovative solutions in areas like border surveillance, autonomous systems, and artificial intelligence. Their track record with the Department of Homeland Security (DHS) includes various contracts aimed at enhancing border security capabilities. For instance, they have been involved in providing sensor technology, drone systems, and integrated surveillance platforms. While specific details on past performance for 'sustainment towers' might vary, their general experience with DHS suggests a capacity to deliver complex technological solutions. A deeper dive into their past performance reviews and contract completion history with DHS would provide a more granular assessment of their reliability and effectiveness in fulfilling similar requirements.

How does the $50.3 million contract value compare to other recent DHS procurements for similar border surveillance or technology sustainment solutions?

The $50.3 million award for sustainment towers and associated computer systems design services represents a significant investment. To benchmark its value, it's essential to compare it with other recent procurements by DHS or similar agencies for large-scale surveillance systems, integrated sensor networks, or advanced border technology solutions. For example, procurements for advanced radar systems, aerial surveillance platforms, or comprehensive command and control software suites can range from tens to hundreds of millions of dollars. If this contract focuses on a specific, albeit critical, component like sustainment towers, its value might be considered moderate within the broader context of total border security technology spending. However, without knowing the exact scope, quantity, and technological sophistication of the 'sustainment towers,' a precise comparison is challenging. Generally, large, integrated technology solutions for national security purposes often command substantial budgets.

What are the primary risks associated with a firm fixed-price contract for complex IT systems like those potentially involved in sustainment towers?

While firm fixed-price (FFP) contracts are designed to provide cost certainty, they can introduce specific risks, especially for complex IT systems. One primary risk is that the contractor may underestimate the scope, complexity, or integration challenges, leading to potential quality compromises if they try to cut corners to maintain profitability. Conversely, if the government's requirements are not perfectly defined upfront, the contractor might face significant scope creep, leading to change orders that increase the overall cost, negating some of the FFP benefits. Another risk is that the contractor might lack the incentive to innovate or suggest cost-saving improvements once the price is fixed. For complex systems like sustainment towers, which likely involve hardware, software, networking, and integration, unforeseen technical hurdles are common. If the contractor bears all the risk, they may price this risk into the initial bid, potentially leading to a higher base price than a cost-reimbursable contract might have initially offered.

What does the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' designation imply about the competitive landscape and potential impact on pricing?

The designation 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' indicates that the solicitation was initially intended to be fully open, allowing all responsible sources to submit offers. However, specific sources were subsequently excluded. This exclusion typically occurs when a particular technology or capability is required that only a limited number of vendors possess, or when there's a justification for using specific existing systems or components. While it's still a form of competition, excluding sources inherently limits the number of potential bidders. This can reduce the competitive pressure on pricing compared to a scenario where all potential vendors could participate. If the excluded sources represented significant competition, taxpayers might end up paying a higher price than if the competition had been entirely unrestricted. The justification for exclusion is critical in determining if this approach was necessary and ultimately beneficial for the government.

What are the potential long-term implications for sustainment and upgrades given the contract's end date of September 30, 2025?

The contract's end date of September 30, 2025, suggests a defined period for the initial delivery and potentially some level of support. For complex IT systems like sustainment towers, this timeframe is relatively short for the entire lifecycle of such technology. The implications are that the U.S. Customs and Border Protection will need to plan for future sustainment, maintenance, and potential upgrades well in advance of this expiration. This could involve seeking follow-on contracts, potentially with the same vendor if performance has been satisfactory, or initiating a new competitive process. The current contract's focus on 'Computer Systems Design Services' might imply that the initial build or integration is the primary scope, leaving long-term operational sustainment and technology refresh as separate future considerations. This necessitates careful planning to avoid gaps in critical border security capabilities.

How does the geographic focus on California influence the specific technological requirements and potential operational benefits of these sustainment towers?

Focusing the deployment of sustainment towers in California suggests specific operational needs related to that region's border challenges. California's border sector presents diverse terrain, including urban areas, deserts, and coastal regions, which may necessitate specialized sensor suites, communication capabilities, and integration with existing infrastructure. The sustainment towers likely incorporate advanced technologies such as high-resolution cameras, radar, thermal imaging, and data analytics platforms to monitor vast areas effectively. The operational benefits would include enhanced situational awareness for border patrol agents, improved detection of illegal crossings and smuggling activities, and potentially faster response times. The specific technological requirements would be tailored to address the unique environmental and security conditions prevalent along the California-Mexico border, influencing the design and functionality of the systems procured under this contract.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1375 SUNFLOWER AVE, COSTA MESA, CA, 92626

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $50,268,326

Exercised Options: $50,268,326

Current Obligation: $50,268,326

Actual Outlays: $50,268,326

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70B02C20D00000019

IDV Type: IDC

Timeline