DoD Awards $71.8M Engineering Services Contract to L3Harris for LRU-2/3 Redesign
Contract Overview
Contract Amount: $71,761,512 ($71.8M)
Contractor: L3harris Technologies, Inc.
Awarding Agency: Department of Defense
Start Date: 2019-05-14
End Date: 2024-08-30
Contract Duration: 1,935 days
Daily Burn Rate: $37.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: ENGINEERING SERVICES FOR LRU-2 AND LRU-3 REDESIGN
Place of Performance
Location: CLIFTON, PASSAIC County, NEW JERSEY, 07014
Plain-Language Summary
Department of Defense obligated $71.8 million to L3HARRIS TECHNOLOGIES, INC. for work described as: ENGINEERING SERVICES FOR LRU-2 AND LRU-3 REDESIGN Key points: 1. Contract awarded to L3Harris Technologies, Inc. for critical engineering services. 2. The contract focuses on redesigning LRU-2 and LRU-3 components. 3. This is a sole-source award, raising questions about competition. 4. The sector is Engineering Services, a common area for DoD spending.
Value Assessment
Rating: fair
The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. The awarded amount of $71.8M is substantial for engineering services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition may result in a higher cost to taxpayers than if the services had been competitively procured.
Public Impact
Essential military hardware redesign impacts readiness and modernization efforts. Taxpayer funds are allocated for critical defense engineering services. Potential for cost overruns due to the contract type and sole-source nature.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost Plus Fixed Fee contract type
- Lack of small business participation
Positive Signals
- Essential defense system upgrade
- Long-term contract duration
Sector Analysis
This contract falls within the Engineering Services sector, which is a significant area of spending for the Department of Defense. Benchmarks for similar engineering services contracts can vary widely based on complexity and scope.
Small Business Impact
The data indicates no specific small business set-aside or participation. This suggests that small businesses may not have had an opportunity to compete for or participate in this significant contract.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure fair pricing and effective execution of the redesign services. Accountability for cost management under the Cost Plus Fixed Fee structure is crucial.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- No apparent small business involvement
- Contract type may incentivize higher costs
Tags
engineering-services, department-of-defense, nj, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $71.8 million to L3HARRIS TECHNOLOGIES, INC.. ENGINEERING SERVICES FOR LRU-2 AND LRU-3 REDESIGN
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 Air Force).
What is the total obligated amount?
The obligated amount is $71.8 million.
What is the period of performance?
Start: 2019-05-14. End: 2024-08-30.
What is the justification for the sole-source award of this engineering services contract?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent requirements that only one contractor can meet. Without further details, it's difficult to assess the validity of this justification. However, sole-source contracts often bypass competitive bidding, potentially leading to higher costs and reduced innovation.
What are the potential risks associated with the Cost Plus Fixed Fee contract type for this redesign effort?
Cost Plus Fixed Fee contracts can incentivize contractors to increase costs to maximize their profit margin, as the fee is a fixed percentage of the total cost. For a complex redesign, this structure may lead to cost overruns if not rigorously monitored. The government bears the risk of cost escalation, while the contractor has less incentive to control expenses.
How will the effectiveness of the LRU-2 and LRU-3 redesign be measured and ensured?
Effectiveness will likely be measured through rigorous testing, performance validation against specified requirements, and successful integration into the existing systems. The Department of the Air Force should establish clear performance metrics and milestones within the contract. Independent verification and validation processes are essential to ensure the redesign meets its intended objectives and enhances operational capabilities.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: FA852218R0009
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: L3harris Technologies, Inc
Address: 77 RIVER RD, CLIFTON, NJ, 07014
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $71,761,512
Exercised Options: $71,761,512
Current Obligation: $71,761,512
Subaward Activity
Number of Subawards: 2
Total Subaward Amount: $442,644
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2019-05-14
Current End Date: 2024-08-30
Potential End Date: 2024-08-30 00:00:00
Last Modified: 2023-06-08
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