FAA Awards $60.7M Raytheon Contract for Aviation System Upgrade, Extending to 2026
Contract Overview
Contract Amount: $60,754,310 ($60.8M)
Contractor: Raytheon Company
Awarding Agency: Department of Transportation
Start Date: 2017-08-31
End Date: 2026-06-30
Contract Duration: 3,225 days
Daily Burn Rate: $18.8K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE
Sector: IT
Official Description: IGF::CL,CT::IGF MODE 5 ATCBI-6M UPGRADE
Place of Performance
Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73125
State: Oklahoma Government Spending
Plain-Language Summary
Department of Transportation obligated $60.8 million to RAYTHEON COMPANY for work described as: IGF::CL,CT::IGF MODE 5 ATCBI-6M UPGRADE Key points: 1. Significant contract value of $60.7 million awarded to a single large business. 2. Limited competition due to 'NOT COMPETED' status raises questions about price discovery. 3. Long contract duration (2017-2026) suggests a critical, ongoing need for the system. 4. The sector is vital for national airspace safety and efficiency.
Value Assessment
Rating: questionable
The contract type is Cost Plus Incentive Fee, which can lead to cost overruns if not managed tightly. Without competitive bidding, it's difficult to assess if the $60.7 million price represents fair value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was 'NOT COMPETED', indicating a sole-source or limited competition approach. This significantly restricts price discovery and may result in higher costs for taxpayers compared to a fully open competition.
Taxpayer Impact: The lack of competition could lead to inflated costs, meaning taxpayers may be paying more than necessary for this aviation system upgrade.
Public Impact
Impacts the safety and efficiency of air traffic control and navigation systems. Affects airlines, airports, and the flying public through improved or maintained operational capabilities. Supports critical infrastructure for national defense and civilian aviation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost-plus contract type
- Long contract duration
Positive Signals
- Essential aviation system upgrade
- Long-term commitment to safety
Sector Analysis
This contract falls within the aerospace and defense sector, specifically focusing on IT systems for aviation. Spending in this area is critical for national infrastructure and safety, with benchmarks often driven by technological complexity and security requirements.
Small Business Impact
The contract was awarded to Raytheon Company, a large business. There is no indication that small businesses were involved as subcontractors or partners in this specific award, missing an opportunity for small business participation.
Oversight & Accountability
The 'NOT COMPETED' status warrants further oversight to ensure the justification for limited competition was sound and that the pricing is reasonable. Ongoing monitoring of the Cost Plus Incentive Fee structure is crucial for accountability.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Transportation Contracting
- Federal Aviation Administration Programs
Risk Flags
- Potential for cost overruns due to Cost Plus Incentive Fee structure.
- Lack of competitive bidding may lead to suboptimal pricing.
- Long contract duration increases exposure to changing technologies and market conditions.
- No clear indication of small business participation.
Tags
search-detection-navigation-guidance-aer, department-of-transportation, ok, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Transportation awarded $60.8 million to RAYTHEON COMPANY. IGF::CL,CT::IGF MODE 5 ATCBI-6M UPGRADE
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Transportation (Federal Aviation Administration).
What is the total obligated amount?
The obligated amount is $60.8 million.
What is the period of performance?
Start: 2017-08-31. End: 2026-06-30.
What was the specific justification for not competing this contract, and were alternative solutions considered?
The justification for not competing this contract is not provided in the data. Typically, reasons include unique capabilities, urgent needs, or lack of viable alternatives. A thorough review would involve examining the agency's documentation to confirm if alternatives were explored and why they were deemed unsuitable, ensuring the decision served the best interest of the government and taxpayers.
How does the cost performance of this Cost Plus Incentive Fee contract compare to similar aviation system upgrades?
Without access to detailed cost performance data and benchmarks for similar aviation system upgrades, a direct comparison is difficult. However, cost-plus contracts inherently carry a higher risk of cost overruns. The FAA's oversight would be critical in managing incentives and ensuring Raytheon meets performance targets efficiently to control final costs.
What are the key performance indicators (KPIs) for this contract, and how is the FAA measuring the effectiveness of the MODE 5 ATCBI-6M UPGRADE?
The provided data does not specify the Key Performance Indicators (KPIs) for this contract. Effectiveness is likely measured by system reliability, operational uptime, successful integration with existing air traffic control infrastructure, and adherence to safety standards. The FAA's contracting officers and technical representatives are responsible for monitoring these metrics.
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
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: DTFASA-17-R-00605
Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Rockwell Collins Australia PTY Limited
Address: 1001 BOSTON POST RD E, MARLBOROUGH, MA, 01752
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: $60,754,310
Exercised Options: $60,754,310
Current Obligation: $60,754,310
Actual Outlays: $35,427,434
Subaward Activity
Number of Subawards: 6
Total Subaward Amount: $6,031,277
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2017-08-31
Current End Date: 2026-06-30
Potential End Date: 2026-06-30 00:00:00
Last Modified: 2024-12-20
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