DHS awards $421M for CT systems to Smiths Detection, impacting checkpoint screening

Contract Overview

Contract Amount: $42,149,100 ($42.1M)

Contractor: Smiths Detection Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2023-04-10

End Date: 2034-04-09

Contract Duration: 4,017 days

Daily Burn Rate: $10.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: COMPUTED TOMOGRAPHY (CT) SYSTEMS AND ALL ASSOCIATED SERVICES AND SUPPLIES TO SUPPORT THE CHECKPOINT PROPERTY SCREENING SYSTEM (CPSS)

Place of Performance

Location: EDGEWOOD, HARFORD County, MARYLAND, 21040

State: Maryland Government Spending

Plain-Language Summary

Department of Homeland Security obligated $42.1 million to SMITHS DETECTION INC. for work described as: COMPUTED TOMOGRAPHY (CT) SYSTEMS AND ALL ASSOCIATED SERVICES AND SUPPLIES TO SUPPORT THE CHECKPOINT PROPERTY SCREENING SYSTEM (CPSS) Key points: 1. Significant investment in advanced screening technology for transportation security. 2. Sole awardee Smiths Detection Inc. dominates this niche market. 3. Long-term contract (10 years) suggests potential for sustained demand and pricing. 4. Focus on checkpoint screening highlights critical infrastructure security needs.

Value Assessment

Rating: fair

The total award value of $421.5M over 10 years averages to $42.15M annually. Without specific per-unit cost data or comparison points for similar CT systems, a precise value assessment is difficult. However, the long duration and single awardee may indicate less aggressive pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

Despite being listed as full and open competition, the award was a delivery order to a single contractor, Smiths Detection Inc. This suggests that while the initial contract vehicle allowed for broad competition, the specific requirement was met by one entity, potentially limiting price discovery for this particular order.

Taxpayer Impact: Taxpayers are funding critical security infrastructure. The long-term nature of the contract and the specific vendor chosen warrant scrutiny to ensure cost-effectiveness over the contract's life.

Public Impact

Enhances security at transportation checkpoints, potentially improving passenger experience through more efficient screening. Supports the Department of Homeland Security's mission to protect national infrastructure. The technology may be deployed across numerous airports and other transportation hubs nationwide. Long-term commitment could lead to technology standardization and integration benefits.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in due to specialized technology.
Limited competition for this specific delivery order despite full and open contract.
Long contract duration may reduce flexibility to adopt newer technologies.

Positive Signals

Addresses a critical national security need for advanced screening.
Long-term contract provides stability for technology deployment and support.
Potential for economies of scale in procurement and maintenance.

Sector Analysis

The Transportation Security Administration (TSA) operates within the broader federal IT and security sector. Spending on advanced screening technologies like CT systems is crucial for maintaining national security and facilitating travel. Benchmarks for similar large-scale technology procurements are often in the tens to hundreds of millions of dollars.

Small Business Impact

The contract was awarded to Smiths Detection Inc., a large corporation. There is no indication that small businesses were significantly involved in this specific delivery order, either as prime contractors or subcontractors, based on the provided data.

Oversight & Accountability

The Department of Homeland Security, through the TSA, is responsible for overseeing this contract. Regular performance reviews and audits would be essential to ensure the contractor meets all requirements and that taxpayer funds are used efficiently over the 10-year period.

Related Government Programs

Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Department of Homeland Security Contracting
Transportation Security Administration Programs

Risk Flags

Sole awardee for this delivery order.
Long contract duration (10 years).
Lack of specific per-unit cost data for benchmarking.
Potential for vendor lock-in.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $42.1 million to SMITHS DETECTION INC.. COMPUTED TOMOGRAPHY (CT) SYSTEMS AND ALL ASSOCIATED SERVICES AND SUPPLIES TO SUPPORT THE CHECKPOINT PROPERTY SCREENING SYSTEM (CPSS)

Who is the contractor on this award?

The obligated recipient is SMITHS DETECTION INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Transportation Security Administration).

What is the total obligated amount?

The obligated amount is $42.1 million.

What is the period of performance?

Start: 2023-04-10. End: 2034-04-09.

What is the specific per-unit cost of the CT systems being procured, and how does it compare to industry benchmarks for similar equipment?

The provided data does not include specific per-unit cost information for the CT systems. To assess value, a comparison with industry benchmarks for comparable Computed Tomography (CT) systems used in security screening would be necessary. Without this, it's difficult to determine if the pricing reflects fair market value or if there's an opportunity for cost savings through further negotiation or competitive bidding on future orders.

Given the long-term nature of the contract, what mechanisms are in place to mitigate the risk of technological obsolescence or the emergence of superior screening technologies?

The contract's 10-year duration presents a risk of technological obsolescence. Mitigation strategies should include performance-based requirements that allow for upgrades or replacements, periodic reviews of emerging technologies, and potentially phased procurements. The contract structure should ideally incentivize the contractor to propose and integrate advancements, rather than simply maintaining the status quo.

How effectively does this contract support the TSA's overall mission to ensure the security and efficiency of transportation screening operations?

This contract directly supports the TSA's mission by providing advanced CT systems, which are crucial for detecting threats at transportation checkpoints. The long-term commitment suggests a strategic investment in enhancing screening capabilities. However, the effectiveness will ultimately depend on the system's reliability, throughput, and the TSA's ability to integrate and operate the technology seamlessly across its network.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: ALARM, SIGNAL, SECURITY DETECTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2202 LAKESIDE BLVD, EDGEWOOD, MD, 21040

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $702,494,420

Exercised Options: $43,984,800

Current Obligation: $42,149,100

Actual Outlays: $30,295,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70T04023G7672N001

IDV Type: BOA

Timeline