Coast Guard's $39.8M contract for navigation systems awarded without competition

Contract Overview

Contract Amount: $39,836,045 ($39.8M)

Contractor: Integrated Coast Guard Systems LLC

Awarding Agency: Department of Homeland Security

Start Date: 2003-03-15

End Date: 2007-01-30

Contract Duration: 1,417 days

Daily Burn Rate: $28.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20003

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $39.8 million to INTEGRATED COAST GUARD SYSTEMS LLC for work described as: Key points: 1. Contract awarded on a firm-fixed-price basis, indicating defined costs. 2. The contract was not competed, raising questions about potential price efficiencies. 3. A long performance period of 1417 days suggests a significant, ongoing need. 4. The award was a delivery order, implying it's part of a larger framework. 5. The contractor, INTEGRATED COAST GUARD SYSTEMS LLC, received the full value. 6. The product service code suggests a focus on specialized navigation instruments.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the lack of competitive bidding. Without comparison to other offers or market rates for similar navigation systems, it's difficult to definitively assess if the $39.8 million represents excellent value for the U.S. Coast Guard. The firm-fixed-price structure provides cost certainty but doesn't inherently guarantee optimal pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competition from multiple vendors. This approach can be justified for specialized needs or existing systems, but it limits the government's ability to leverage market competition to drive down prices and ensure the best possible value. The absence of bidders means there's no direct comparison of capabilities or pricing.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from the cost savings typically achieved through competitive bidding processes, potentially leading to higher overall expenditures for the government.

Public Impact

The U.S. Coast Guard benefits from the acquisition of essential search, detection, navigation, guidance, aeronautical, and nautical systems. These systems are critical for maritime safety, security operations, and search and rescue missions. The contract supports the operational readiness of Coast Guard vessels and aircraft. The primary geographic impact is within the operational areas of the U.S. Coast Guard, likely nationwide and potentially international.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may have resulted in a higher price than a competed award.
Sole-source awards can reduce transparency in pricing and value assessment.
Long contract duration without competition warrants scrutiny for continued necessity and fair pricing.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Award to a specific contractor suggests a potentially specialized capability meeting a defined need.
The contract supports critical national security and safety functions for the Coast Guard.

Sector Analysis

This contract falls within the "Manufacturing" sector, specifically focusing on "Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing." This is a niche area within defense and public safety technology. Comparable spending benchmarks would typically involve other government procurements for similar advanced navigation and sensor systems, often characterized by high research and development costs and specialized production requirements.

Small Business Impact

There is no indication that this contract involved small business set-asides or subcontracting requirements. As a sole-source award, the focus was likely on meeting a specific technical requirement rather than broader economic goals related to small business participation. This contract does not appear to directly impact the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Homeland Security's procurement regulations and the U.S. Coast Guard's program management. Accountability measures would be tied to the delivery of specified systems and adherence to the firm-fixed-price terms. Transparency is limited due to the sole-source nature of the award, making detailed public scrutiny of the procurement process challenging.

Related Government Programs

Department of Homeland Security Procurement
U.S. Coast Guard Equipment Procurement
Navigation Systems Manufacturing
Defense and Security Technology Contracts

Risk Flags

Sole-source award
Lack of competition
Potential for overpricing
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $39.8 million to INTEGRATED COAST GUARD SYSTEMS LLC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is INTEGRATED COAST GUARD SYSTEMS LLC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $39.8 million.

What is the period of performance?

Start: 2003-03-15. End: 2007-01-30.

What specific navigation systems were procured under this contract, and what are their key functionalities?

The contract, NA 334511, was for 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing.' While the specific system details are not provided in the abbreviated data, this broad description suggests the procurement of advanced equipment critical for the U.S. Coast Guard's operations. These systems likely include radar, GPS, sonar, communication equipment, and potentially integrated command and control displays used for maritime surveillance, search and rescue coordination, vessel traffic management, and operational navigation in diverse environmental conditions. The 'Manufacturing' aspect indicates the contract covered the production or assembly of these instruments.

Why was this contract awarded on a sole-source basis instead of being competed?

The provided data indicates the contract was 'NOT COMPETED' and awarded as a 'sole-source' action. Specific justifications for sole-source awards typically include situations where only one responsible source can provide the required supply or service, such as when the item is unique, proprietary, or essential for interoperability with existing systems. Without further documentation, the exact reason for this sole-source designation remains unclear, but it implies that the Department of Homeland Security determined that INTEGRATED COAST GUARD SYSTEMS LLC was the only viable option at the time of award, potentially due to specialized technology, existing infrastructure integration, or urgent need.

How does the $39.8 million contract value compare to similar procurements for navigation systems?

Direct comparison of the $39.8 million contract value is difficult without knowing the exact specifications and quantities of the navigation systems procured. However, the duration of the contract (1417 days, approximately 3.8 years) suggests a substantial procurement. Given that it was a sole-source award, it is plausible that the price may be higher than if it had undergone competitive bidding. To establish a benchmark, one would need to analyze other government contracts for similar navigation and sensor suites, considering factors like technological sophistication, system integration, and the number of units acquired.

What is the track record of INTEGRATED COAST GUARD SYSTEMS LLC in fulfilling government contracts, particularly for the U.S. Coast Guard?

The provided data identifies INTEGRATED COAST GUARD SYSTEMS LLC as the contractor for this $39.8 million award. To assess their track record, a deeper dive into their contract history with the U.S. Coast Guard and other federal agencies would be necessary. This would involve examining past performance evaluations, on-time delivery rates, adherence to contract terms, and any history of disputes or contract modifications. Without this additional information, it's challenging to provide a specific assessment of their reliability and performance quality for this particular contract.

What are the potential risks associated with a sole-source award of this magnitude and duration?

The primary risks associated with a sole-source award of this magnitude ($39.8 million) and duration (1417 days) include potential overpricing due to the lack of competitive pressure, reduced innovation from the vendor (as there's no competitive incentive), and a lack of transparency in the procurement process. Taxpayers may not be receiving the best possible value for their money. Furthermore, a long-term sole-source relationship can create vendor lock-in, making it difficult and costly to switch to alternative solutions in the future. There's also a risk that the government's needs might evolve, and the sole-source vendor may not be able to adapt as effectively as a more competitive market.

How does this spending align with overall U.S. Coast Guard spending on navigation and detection systems?

This $39.8 million contract represents a significant investment in navigation and detection systems for the U.S. Coast Guard. To understand its alignment with overall spending, one would need to analyze historical and projected budgets for the Coast Guard's C4IT (Command, Control, Communications, Computers, and Information Technology) or similar operational systems categories. This single contract's value should be compared against the total annual expenditure for such equipment across the entire fleet and shore installations. Without broader budget context, it's difficult to determine if this represents a typical, increased, or decreased level of investment for this specific capability.

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: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 300 M ST SE STE 685, WASHINGTON, DC, 20003

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $70,560,400

Exercised Options: $70,188,684

Current Obligation: $39,836,045

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: DTCG2302C2DW001

IDV Type: IDC

Timeline