DoD awards L3Harris Technologies $112.9M for enterprise terminal modernization, impacting wireless communications equipment manufacturing
Contract Overview
Contract Amount: $112,923,602 ($112.9M)
Contractor: L3harris Technologies, Inc.
Awarding Agency: Department of Defense
Start Date: 2017-04-21
End Date: 2023-04-22
Contract Duration: 2,192 days
Daily Burn Rate: $51.5K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: IGF::CL,CT::IGF AWARD OF THE MODERNIZATION OF ENTERPRISE TERMINALS DEPOT FOLLOW-ON TASK ORDER.
Place of Performance
Location: PALM BAY, BREVARD County, FLORIDA, 32905
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $112.9 million to L3HARRIS TECHNOLOGIES, INC. for work described as: IGF::CL,CT::IGF AWARD OF THE MODERNIZATION OF ENTERPRISE TERMINALS DEPOT FOLLOW-ON TASK ORDER. Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. Task order is a follow-on, indicating a continuation of existing services or a phased approach. 3. The contract duration of approximately 6 years suggests a long-term need for these services. 4. The North American Industry Classification System (NAICS) code 334220 points to the wireless communications equipment manufacturing sector. 5. The contract's primary location is Florida, a state with a significant defense industry presence. 6. The cost-plus-fixed-fee (CPFF) pricing structure can lead to cost overruns if not managed carefully.
Value Assessment
Rating: fair
Benchmarking the value of this specific task order is challenging without more detailed cost breakdowns and comparisons to similar modernization efforts. The CPFF structure inherently carries risk for cost control. However, the award amount of over $112 million for a multi-year modernization project in a specialized sector like wireless communications equipment manufacturing suggests a significant investment. Further analysis would require comparing the unit costs of specific terminal components or services against industry standards and other government contracts for similar equipment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. This typically fosters a competitive environment, which can lead to better pricing and innovation. The number of bidders is not specified, but the 'full and open' designation suggests a robust competition was intended.
Taxpayer Impact: A competitive award process generally benefits taxpayers by driving down costs and ensuring the government receives the best value for its investment.
Public Impact
The Department of the Army benefits from modernized enterprise terminals, likely enhancing communication capabilities. Services delivered are related to the manufacturing of wireless communications equipment, supporting military operational readiness. The primary geographic impact is in Florida, where the contractor is located and likely where work will be performed. The contract supports jobs within the wireless communications equipment manufacturing sector, potentially including engineering, production, and support roles.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts can incentivize contractors to increase costs to maximize profit, requiring diligent oversight.
- Follow-on task orders can sometimes lack the same level of scrutiny as initial contract awards.
- The specific nature of 'enterprise terminal modernization' requires detailed understanding to ensure scope creep is managed.
Positive Signals
- Awarded under full and open competition, suggesting a competitive process that should yield fair pricing.
- The long duration of the task order (approx. 6 years) indicates a sustained need and potential for stable service delivery.
- The contract is for modernization, implying an upgrade to existing capabilities, which is generally a positive investment.
Sector Analysis
This contract falls within the broader Information Technology and Defense sectors, specifically focusing on the manufacturing of radio and television broadcasting and wireless communications equipment. The market for such specialized equipment is driven by technological advancements and the evolving needs of defense and public safety agencies. Comparable spending benchmarks would involve analyzing other DoD contracts for communication systems, terminal upgrades, and related manufacturing services, considering the scale and technological complexity.
Small Business Impact
The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside requirement. However, the prime contractor, L3Harris Technologies, Inc., may engage small businesses as subcontractors for specialized components or services, which would be detailed in their subcontracting plan, if applicable.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. As a cost-plus-fixed-fee contract, rigorous financial oversight is crucial to monitor expenditures and ensure the fixed fee remains appropriate. Transparency is typically managed through contract reporting mechanisms and performance reviews. The Inspector General's office for the Department of Defense would have jurisdiction for audits and investigations related to potential fraud, waste, or abuse.
Related Government Programs
- Defense Communications Systems
- Tactical Communication Equipment
- Wireless Network Infrastructure
- Military Electronics Manufacturing
- Enterprise IT Modernization
Risk Flags
- Cost Overrun Risk (CPFF)
- Scope Creep Potential
- Follow-on Order Scrutiny
Tags
department-of-defense, department-of-the-army, l3harris-technologies, wireless-communications-equipment-manufacturing, radio-and-television-broadcasting-equipment-manufacturing, delivery-order, cost-plus-fixed-fee, full-and-open-competition, follow-on-task-order, florida, modernization, enterprise-terminals
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $112.9 million to L3HARRIS TECHNOLOGIES, INC.. IGF::CL,CT::IGF AWARD OF THE MODERNIZATION OF ENTERPRISE TERMINALS DEPOT FOLLOW-ON TASK ORDER.
Who is the contractor on this award?
The obligated recipient is L3HARRIS TECHNOLOGIES, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $112.9 million.
What is the period of performance?
Start: 2017-04-21. End: 2023-04-22.
What is the historical spending pattern for enterprise terminal modernization within the Department of Defense, and how does this award compare?
Analyzing historical spending for enterprise terminal modernization within the DoD requires access to comprehensive contract databases and budget allocations. Generally, modernization efforts are cyclical, driven by technological obsolescence and evolving operational requirements. Awards in this category can range from tens of millions to billions of dollars, depending on the scope, number of units, and technological sophistication. This specific $112.9 million award for L3Harris Technologies appears to be a significant, multi-year investment for a specific task order. Without granular data on previous, comparable modernization programs (e.g., specific terminal types, quantities, and contract vehicles), a precise comparison is difficult. However, the duration and value suggest it represents a substantial portion of the DoD's current focus on upgrading its terminal infrastructure within the specified wireless communications equipment manufacturing domain.
What specific risks are associated with Cost Plus Fixed Fee (CPFF) contracts in the context of wireless communications equipment manufacturing?
Cost Plus Fixed Fee (CPFF) contracts, like the one awarded to L3Harris Technologies, present specific risks. The primary risk is that the contractor has less incentive to control costs compared to fixed-price contracts, as their profit (the fixed fee) is predetermined. If costs escalate beyond initial projections, the government bears the additional expense, potentially leading to budget overruns. For wireless communications equipment manufacturing, this could manifest in unexpected material costs, labor rate increases, or unforeseen technical challenges during development or production. Effective risk mitigation requires robust government oversight, detailed cost tracking, regular audits, and clear definition of allowable costs to prevent contractor over-expenditure and ensure the fixed fee remains a fair compensation for the defined scope of work.
How does the NAICS code 334220 (Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing) typically perform in terms of contract awards and competition within the DoD?
The NAICS code 334220 encompasses a critical segment of the defense industrial base, supplying essential communication hardware. Contracts within this sector awarded by the DoD often involve high technological complexity and significant value, driven by the need for secure, reliable, and advanced communication systems. Competition can vary; while large, established defense contractors like L3Harris Technologies often dominate major programs, there can be opportunities for specialized small and medium-sized businesses in niche areas or as subcontractors. Awards under 'full and open competition' suggest a desire for broad market engagement, but the specialized nature of the equipment can sometimes limit the pool of highly qualified bidders. Historical data would likely show a consistent demand from the DoD for equipment in this category, reflecting its ongoing importance for military operations.
What is L3Harris Technologies' track record with the Department of the Army for similar modernization or manufacturing contracts?
L3Harris Technologies, Inc. has a substantial track record with the Department of Defense, including the Department of the Army, across various technology and defense systems. They are a significant player in areas such as communications, electronic warfare, and space systems. For modernization and manufacturing contracts specifically related to communication equipment, L3Harris has historically secured numerous awards. Assessing their specific performance on 'enterprise terminal modernization' would require a deep dive into their past performance evaluations, on-time delivery rates, and cost performance on prior Army contracts. Generally, as a large, established defense contractor, they are expected to meet stringent performance requirements, but like any major supplier, past performance reviews on specific contracts would provide the most accurate picture of their reliability and effectiveness in this domain.
What are the potential implications of this contract being a 'follow-on task order' for cost and performance?
A 'follow-on task order' implies that this contract builds upon or continues work previously performed under an existing contract, potentially with the same contractor. This can have several implications. On the positive side, it suggests continuity of service and potentially reduced startup time and costs, as the contractor is already familiar with the requirements and systems. However, it can also pose risks. If the original contract was not competitively bid or if its performance was suboptimal, a follow-on order might perpetuate those issues. From a cost perspective, follow-on orders can sometimes be less scrutinized than new awards, potentially leading to less aggressive pricing if not managed carefully. For performance, familiarity can breed efficiency, but it can also lead to complacency. Robust oversight is still essential to ensure that the work continues to meet evolving requirements and represents good value for taxpayers.
Industry Classification
NAICS: Manufacturing › Communications Equipment Manufacturing › Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: L3harris Technologies, Inc
Address: 2400 PALM BAY RD NE, PALM BAY, FL, 32905
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $112,923,602
Exercised Options: $112,923,602
Current Obligation: $112,923,602
Subaward Activity
Number of Subawards: 6
Total Subaward Amount: $361,858
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W15P7T09DH001
IDV Type: IDC
Timeline
Start Date: 2017-04-21
Current End Date: 2023-04-22
Potential End Date: 2023-04-22 00:00:00
Last Modified: 2024-10-09
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