Army awards $37.8M for optical instruments, with Harris Corp. securing the deal

Contract Overview

Contract Amount: $37,856,160 ($37.9M)

Contractor: Harris Corporation

Awarding Agency: Department of Defense

Start Date: 2008-06-11

End Date: 2010-10-31

Contract Duration: 872 days

Daily Burn Rate: $43.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ARMY FUNDING

Place of Performance

Location: ROANOKE, ROANOKE County, VIRGINIA, 24019

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $37.9 million to HARRIS CORPORATION for work described as: ARMY FUNDING Key points: 1. Value for money assessed against similar contracts and market rates. 2. Competition dynamics indicate a full and open process. 3. Risk indicators are moderate, given the firm-fixed-price contract type. 4. Performance context relies on contractor's historical delivery. 5. Sector positioning within optical instrument manufacturing. 6. Spending context shows this as a moderate-sized award for the category.

Value Assessment

Rating: good

The contract value of $37.8 million for optical instruments appears reasonable when benchmarked against similar procurements. The firm-fixed-price structure suggests that the contractor bears the primary risk for cost overruns, which can be advantageous for the government. However, a more precise value-for-money assessment would require detailed cost breakdowns and comparisons to industry benchmarks for specific optical components or systems.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of two bidders suggests a competitive environment, though the exact number of interested parties and the rigor of the evaluation process would provide further insight into the strength of the competition.

Taxpayer Impact: A full and open competition generally leads to better price discovery and potentially lower costs for taxpayers compared to sole-source or limited competition awards.

Public Impact

The Department of the Army is the primary beneficiary, receiving advanced optical instruments. Services delivered include the manufacturing and supply of specialized optical equipment. Geographic impact is primarily within the defense supply chain, with potential for broader technological application. Workforce implications include employment in manufacturing and technical roles within the optical industry.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if scope creep occurs, despite fixed-price terms.
Dependence on a single contractor for delivery could pose supply chain risks.
Ensuring the delivered optical instruments meet stringent military specifications requires robust quality assurance.

Positive Signals

Firm-fixed-price contract type mitigates cost escalation risks for the government.
Full and open competition suggests a competitive pricing environment.
The award to a known entity like Harris Corporation may indicate a track record of successful delivery.

Sector Analysis

The optical instrument and lens manufacturing sector is critical for defense, aerospace, and scientific research. This contract falls within a niche but vital segment of advanced manufacturing. Spending in this sector can range from small, specialized component orders to large, integrated system procurements. Benchmarking this award against other defense contracts for similar optical systems would provide further context on its relative size and value.

Small Business Impact

The contract details do not indicate any specific small business set-asides. Given the nature of advanced optical manufacturing, it is possible that subcontracting opportunities may exist for specialized small businesses, but this is not explicitly detailed in the award information. Further analysis would be needed to determine the extent of small business participation.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program management within the Department of the Army. Accountability measures are inherent in the firm-fixed-price contract, requiring delivery of specified goods. Transparency is facilitated by the public nature of contract awards, though detailed performance metrics are often internal.

Related Government Programs

Department of Defense Procurement
Optical and Electro-Optical Equipment Manufacturing
Army Weapon Systems Support
Advanced Manufacturing Contracts

Risk Flags

Potential for quality issues if contractor prioritizes cost savings over performance.
Risk of delivery delays if unforeseen technical challenges arise.
Dependence on a single source for critical components could impact supply chain resilience.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.9 million to HARRIS CORPORATION. ARMY FUNDING

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 $37.9 million.

What is the period of performance?

Start: 2008-06-11. End: 2010-10-31.

What is Harris Corporation's track record with similar Department of Defense contracts?

Harris Corporation, now part of L3Harris Technologies, has a long history of supplying advanced technology solutions to the Department of Defense. Their portfolio includes a wide range of electronic systems, communications, and sensor technologies. For optical instruments specifically, their track record would need to be examined for prior awards of similar scale and complexity. Past performance evaluations, if publicly available, would indicate their reliability in meeting delivery schedules, quality standards, and technical specifications. Analyzing their history with firm-fixed-price contracts would also reveal their experience in managing costs and risks associated with such agreements, providing insight into their capability to successfully execute this particular award.

How does the $37.8 million award compare to the average cost of similar optical instrument procurements?

Benchmarking the $37.8 million award requires comparing it to the average contract values for similar optical instruments procured by the Department of Defense or other federal agencies. Factors such as the specific type of optical instrument (e.g., targeting systems, surveillance optics, scientific imaging equipment), the complexity of the technology, the quantity ordered, and the contract duration all influence cost. Without detailed specifications of the instruments procured under this award, a precise comparison is difficult. However, if this award represents a significant deviation from historical averages for comparable systems, it could warrant further investigation into the pricing structure and justification. Data from contract databases and industry reports can provide a basis for such comparisons.

What are the primary risks associated with this firm-fixed-price contract for optical instruments?

While firm-fixed-price (FFP) contracts are generally favored for mitigating cost escalation for the government, they do present certain risks. For this $37.8 million award, risks include the potential for the contractor, Harris Corporation, to cut corners on quality or performance to maintain profitability if their cost estimates were too low. There's also a risk of scope creep, where the government may request modifications or additions that are not adequately captured in the original FFP terms, potentially leading to disputes or change orders. Furthermore, if the technology is highly specialized or rapidly evolving, the FFP might not adequately account for unforeseen technical challenges, potentially impacting delivery timelines or the final product's capabilities. Robust government oversight and clear contract specifications are crucial to managing these risks.

What is the expected program effectiveness and impact of these optical instruments?

The effectiveness and impact of the optical instruments procured under this $37.8 million contract are directly tied to their intended military application. Assuming these instruments are for critical functions such as surveillance, targeting, reconnaissance, or navigation, their successful delivery and performance are vital for mission success. Enhanced optical capabilities can improve situational awareness, increase accuracy, and reduce risks to personnel. The program's effectiveness will be measured by the instruments' reliability, durability in operational environments, and their ability to meet or exceed specified performance metrics. The ultimate impact is the contribution to the Department of the Army's overall operational readiness and effectiveness.

How does this award fit into the historical spending patterns for optical instruments by the Department of the Army?

To assess how this $37.8 million award fits into historical spending patterns, one would need to analyze the Department of the Army's procurement data for optical instruments over several fiscal years. This analysis would involve identifying the total annual spending on such equipment, the average award size, and the frequency of contracts awarded to major defense contractors like Harris Corporation. If this award represents a typical or average expenditure for this category, it suggests consistent demand and budgeting for optical technologies. Conversely, if it is unusually large or small compared to historical norms, it might indicate a shift in strategic priorities, technological advancements, or changes in procurement strategies. Understanding these patterns provides context for the current award's significance.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Optical Instrument and Lens Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

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, 06

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $37,856,160

Exercised Options: $37,856,160

Current Obligation: $37,856,160

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W9124Q05D0821

IDV Type: IDC

Timeline