DoD's $338M contract for communication equipment to Harris Corp. shows long-term vendor relationship and potential for cost efficiencies
Contract Overview
Contract Amount: $337,935,500 ($337.9M)
Contractor: L3harris Technologies, Inc.
Awarding Agency: Department of Defense
Start Date: 1998-05-29
End Date: 2012-07-16
Contract Duration: 5,162 days
Daily Burn Rate: $65.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 199810!2100!2573!AB07 !USA COMM-ELECTRONICS COMMAND !DAAB0798CA515 !A!*!* !19980529!20081230!883465783!004203337!004203337!N!66948!HARRIS CORPORATION !P.O. BOX 91000 !MELBOURNE !FL!32906!54000!009!12!PALM BAY !BREVARD !FLORIDA !0001!+000022850000!N!N!000000000000!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION !1GVE!SATELLITE COMMUNICATIONS !3669!3!*!*!*!B!A!*!A !N!J!2!001!B!* !A!N!A!* !* !N!C!*!C!C!A!A!A!*!* !*!N!A!C!N!*!*!*!*!*!
Place of Performance
Location: PALM BAY, BREVARD County, FLORIDA, 32905
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $337.9 million to L3HARRIS TECHNOLOGIES, INC. for work described as: 199810!2100!2573!AB07 !USA COMM-ELECTRONICS COMMAND !DAAB0798CA515 !A!*!* !19980529!20081230!883465783!004203337!004203337!N!66948!HARRIS CORPORATION !P.O. BOX 91000 !MELBOURNE !FL!32906!54000!009!12!PALM BAY !BREVAR… Key points: 1. The contract, awarded in 1998, highlights a long-standing relationship with Harris Corporation for communication equipment. 2. A firm-fixed-price structure suggests predictable costs for the government over the contract's duration. 3. The significant duration of the contract (over 13 years) may indicate a critical, ongoing need for these specific communication systems. 4. While the initial award was substantial, the total value over its lifespan needs to be assessed against evolving technological needs and market prices. 5. The contract's focus on satellite communications places it within a key strategic area for defense operations. 6. The absence of small business set-asides suggests the primary contractor or its direct supply chain may not have prioritized subcontracting opportunities for smaller firms.
Value Assessment
Rating: fair
This contract, awarded in 1998 and lasting over 13 years, represents a significant investment in communication equipment. While the total value of $338 million over such a long period is substantial, direct comparisons to similar contracts are challenging due to the age of the award and the specific nature of satellite communication systems. The firm-fixed-price nature of the contract provides cost certainty, but without detailed breakdowns of unit costs or performance metrics, a precise value-for-money assessment is difficult. Benchmarking against current market rates for comparable technology would likely show a significant difference, but this contract predates much of that.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. However, the long duration and the specific nature of the required communication equipment might have limited the number of truly competitive bids. The fact that it was competed suggests an effort to secure the best available solution at the time of award.
Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to drive down prices through market forces. However, the long-term nature of this specific contract means that the initial competitive advantage may have diminished over time.
Public Impact
The U.S. Department of Defense benefits from reliable satellite communication capabilities, crucial for command and control, intelligence gathering, and operational coordination. This contract ensures the provision of miscellaneous communication equipment, likely including hardware and potentially related services, to support military operations. The geographic impact is national, supporting DoD operations across various theaters and bases. Workforce implications include support for personnel involved in the manufacturing, deployment, and maintenance of these communication systems, both within the contractor's organization and potentially within the DoD.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration may lead to technology obsolescence if not managed proactively.
- Lack of explicit small business subcontracting goals could limit opportunities for smaller innovative firms.
- Reliance on a single primary vendor for an extended period might reduce future negotiating leverage.
- The firm-fixed-price nature, while offering cost certainty, could lead to the contractor retaining significant profit if costs are lower than anticipated.
Positive Signals
- The contract's longevity suggests a successful and reliable performance history with the awarded vendor.
- Firm-fixed-price contracts provide budget predictability for the government.
- Awarding under full and open competition indicates an initial effort to maximize value and choice.
- The specific nature of the equipment likely addresses a critical and enduring defense requirement.
Sector Analysis
This contract falls within the Electronics and Communication sector, specifically focusing on Satellite Communications. The defense industry heavily relies on advanced communication systems for global operations. Spending in this area is critical for maintaining situational awareness and command and control. Comparable spending benchmarks would typically involve other large-scale defense communication system procurements, often characterized by long development cycles and substantial investment.
Small Business Impact
The data indicates this contract was not set aside for small businesses (sb: false). This suggests that the primary procurement was aimed at large defense contractors capable of fulfilling the extensive requirements for communication equipment. There is no explicit information on subcontracting plans, but the absence of a small business set-aside often implies limited direct opportunities for small businesses unless they are part of the larger contractor's supply chain.
Oversight & Accountability
Oversight for this contract would have been managed by the Defense Contract Management Agency (DCMA), responsible for ensuring contractor performance and compliance. As a definitive contract, it would be subject to standard government oversight procedures, including audits and performance reviews. Transparency is generally maintained through contract databases, though specific performance details and financial breakdowns may be less publicly accessible for older contracts.
Related Government Programs
- DoD Satellite Communications Systems
- Defense Communications Infrastructure
- Tactical Communication Equipment
- Command and Control Systems
- Electronic Warfare Systems
Risk Flags
- Long contract duration may indicate potential for technology obsolescence.
- Lack of small business subcontracting focus.
- Limited transparency on specific equipment and performance metrics.
- Potential for vendor lock-in due to long-term relationship.
Tags
defense, department-of-defense, communication-equipment, satellite-communications, harris-corporation, definitive-contract, firm-fixed-price, full-and-open-competition, florida, 1998-award, long-term-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $337.9 million to L3HARRIS TECHNOLOGIES, INC.. 199810!2100!2573!AB07 !USA COMM-ELECTRONICS COMMAND !DAAB0798CA515 !A!*!* !19980529!20081230!883465783!004203337!004203337!N!66948!HARRIS CORPORATION !P.O. BOX 91000 !MELBOURNE !FL!32906!54000!009!12!PALM BAY !BREVARD !FLORIDA !0001!+000022850000!N!N!000000000000!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION !1GVE!SATELLITE COMMUNICATIONS !3669!3!*!*!*!B!A!*!A !N!J!2!0
Who is the contractor on this award?
The obligated recipient is L3HARRIS TECHNOLOGIES, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $337.9 million.
What is the period of performance?
Start: 1998-05-29. End: 2012-07-16.
What was the specific type and quantity of communication equipment procured under this contract?
The contract specifies "MISCELLANEOUS COMMUNICATION EQUIPMENT" under the Product Service Code (PSC) 5895. While the exact quantity is not detailed in the provided data, the total contract value of $338 million over approximately 14 years suggests a substantial volume of equipment. This could range from satellite terminals and modems to related infrastructure components necessary for robust military communication networks. The broad categorization indicates a need for a variety of communication assets rather than a single, highly specialized item.
How does the per-unit cost of this equipment compare to contemporary market rates at the time of award?
Determining the precise per-unit cost is not feasible with the provided data, as it lacks specific quantity breakdowns for individual equipment types. However, given the contract's firm-fixed-price nature and its award in 1998, the pricing would have been negotiated based on market conditions and anticipated production costs at that time. Without detailed line-item information, a direct comparison to contemporary market rates is speculative. Generally, large-volume government contracts aim for favorable pricing, but specialized defense equipment often carries a premium due to stringent requirements and limited production runs compared to commercial off-the-shelf items.
What were the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract?
The provided data does not include specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. Typically, for defense communication equipment, KPIs would focus on reliability (e.g., uptime percentages), transmission speeds, security compliance, environmental resilience (operating temperature, shock resistance), and interoperability with existing military networks. SLAs might cover delivery timelines, maintenance response times, and technical support availability. The absence of this detail in the summary data means a thorough assessment of performance against expectations is not possible from this record alone.
What is the track record of Harris Corporation (now L3Harris Technologies) in fulfilling similar large-scale defense communication contracts?
Harris Corporation, now L3Harris Technologies, has a long and established history of delivering complex communication systems and technologies to the U.S. military and other government agencies. They are a major player in defense electronics, including satellite communications, tactical radios, and electronic warfare systems. Their track record includes numerous large-scale contracts for various branches of the DoD, often involving advanced technology development and integration. The longevity and value of this specific contract suggest a successful partnership, indicative of their capability to meet demanding defense requirements over extended periods.
Were there any significant contract modifications or change orders throughout the contract's lifecycle?
The provided data does not detail specific contract modifications or change orders. However, for a contract spanning over 13 years (from May 1998 to July 2012), it is highly probable that modifications occurred. These could have been related to adjustments in quantities, incorporation of new technologies, changes in delivery schedules, or updates to specifications based on evolving operational needs or technological advancements. Such modifications are common in long-term defense procurements to ensure the equipment remains relevant and effective.
How does this contract's spending compare to overall U.S. defense spending on communication systems during the period it was active?
This contract's total value of approximately $338 million represents a portion of the U.S. defense budget allocated to communication systems. During the active period of this contract (1998-2012), overall U.S. defense spending saw significant fluctuations, particularly with increased expenditures during the post-9/11 era. While $338 million is a substantial sum for a single contract, it would be a fraction of the total annual defense spending on communications, which encompasses a wide array of technologies, research and development, and global network infrastructure. Specific comparisons would require detailed analysis of historical defense budget allocations for communication and information technology.
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Contractor Details
Parent Company: L3harris Technologies, Inc (UEI: 004203337)
Address: 2400 PALM BAY RD NE, PALM BAY, FL, 32905
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $286,588,091
Exercised Options: $286,588,091
Current Obligation: $337,935,500
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 1998-05-29
Current End Date: 2012-07-16
Potential End Date: 2012-07-16 00:00:00
Last Modified: 2021-07-29
More Contracts from L3harris Technologies, Inc.
- 200204!000024!5700!GV59 !esc/Ndk !F1962802C0010 !A!N! !N! !20020130!20020930!052819732!052819732!001216845!n!itt Industries, Inc , Systems !4410 E Fountain Blvd !colorado Sprin !co!80916!16000!041!08!colorado Springs !EL Paso !colorado !+000003175920!n!n!000519009204!j099!maint & Repair of Eq/Miscellaneous Equipment !A7 !electronics and Communication !3gwq!474l Bmews !541512!E! !3! ! ! ! ! !99990909!B! ! !B! !a!n!r!2!002!b! !Z!N!Z! ! !N!C!N! ! ! !a!a!a!a!000!a!d!n! ! ! ! ! ! !0001! — $2.2B (Department of Defense)
- THE Purpose of This Contract IS to Develop the Ground System That Will Support Noaa S Next Generation Geostationary Satellite Series, Goes-R. This NEW Series of Spacecraft, SET to Begin Launching in 2015, IS Expected to Double the Clarity of Today S Satellite Imagery and Provide AT Least 20 Times More Atmospheric Observations From Space. the Contractor IS to Design, Develop, Test and Implement the Goes-R Ground System. the Ground System Will Capture Data From the Goes-R Satellites, and Process and Distribute the Information to Operational Users — $1.8B (Department of Commerce)
- Requisition for MOD - Incrementally Funded - This PR Provides Funding for Ads-B National Contract Support for SBS Program Office — $1.3B (Department of Transportation)
- Award of Maintenance of Space Surveillence and Integrated Capabilities Contract — $1.2B (Department of Defense)
- TAS::80 0122::TAS Development, Manufacturing and Support to Weather Observing Instrument — $1.0B (National Aeronautics and Space Administration)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)