Coast Guard's $120M contract for navigation systems awarded without competition

Contract Overview

Contract Amount: $120,000,000 ($120.0M)

Contractor: Integrated Coast Guard Systems LLC

Awarding Agency: Department of Homeland Security

Start Date: 2004-09-28

End Date: 2008-09-30

Contract Duration: 1,463 days

Daily Burn Rate: $82.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: EPA ADJUSTMENT INDICES

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 $120.0 million to INTEGRATED COAST GUARD SYSTEMS LLC for work described as: EPA ADJUSTMENT INDICES Key points: 1. The contract was awarded on a sole-source basis, raising questions about potential cost efficiencies. 2. The duration of the contract (over 4 years) suggests a long-term need for these systems. 3. The lack of competition may limit opportunities for innovation and cost reduction. 4. The specific systems procured are critical for search, detection, and navigation operations. 5. The contract's value of $120 million indicates a significant investment in maritime safety and security.

Value Assessment

Rating: questionable

Without a competitive bidding process, it is difficult to benchmark the value for money. The firm fixed-price contract type suggests cost certainty for the government, but the absence of competition means there was no external pressure to achieve the lowest possible price. Further analysis would require comparing the unit costs or overall price to similar systems procured competitively by other agencies or in the private sector.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded without competition, meaning only one vendor was considered. This approach is typically used when a unique capability is required or when only one source can fulfill the requirement. The lack of multiple bidders means the government did not benefit from the price discovery that occurs in a competitive environment.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure to lower prices. The government missed an opportunity to explore potentially more cost-effective solutions from a wider range of suppliers.

Public Impact

The U.S. Coast Guard benefits from enhanced capabilities in search, detection, navigation, and guidance. Maritime safety and security operations are improved through the deployment of advanced systems. Personnel operating in maritime environments will have access to more reliable and sophisticated equipment. The contract supports the operational readiness of the Coast Guard, a key component of homeland security.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Sole-source awards can stifle innovation by limiting market entry for new technologies.
Dependence on a single contractor can create supply chain risks.
The long contract duration without re-competition could lead to complacency in performance.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
The procurement addresses critical operational needs for the U.S. Coast Guard.
The contractor, Integrated Coast Guard Systems LLC, is likely specialized in these systems.

Sector Analysis

This contract falls within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector. This industry is characterized by specialized technology development and manufacturing, often serving government and defense clients. The market size can be substantial, driven by national security and safety requirements. Comparable spending benchmarks would involve looking at other procurements for similar navigation and sensor systems by agencies like the Navy, NOAA, or international maritime authorities.

Small Business Impact

The data indicates this contract was not competed and does not specify any small business set-aside or subcontracting goals. As a sole-source award, it is unlikely that small businesses were directly involved in the primary contract. However, the prime contractor may engage small businesses for specific components or services, but this is not evident from the provided data. The impact on the small business ecosystem is likely minimal unless subcontracting opportunities arise.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Homeland Security's Inspector General. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver specified goods or services for an agreed-upon price. Transparency is limited due to the sole-source nature of the award; details of the justification for not competing would be crucial for a full assessment.

Related Government Programs

Maritime Domain Awareness Systems
Navigation and Guidance Systems
Search and Detection Equipment
Coast Guard Modernization Programs
Homeland Security Technology Procurements

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns
Limited innovation incentives

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $120.0 million to INTEGRATED COAST GUARD SYSTEMS LLC. EPA ADJUSTMENT INDICES

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 $120.0 million.

What is the period of performance?

Start: 2004-09-28. End: 2008-09-30.

What was the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was awarded as 'NOT COMPETED'. Typically, sole-source awards are justified when only one responsible source is available to provide the required supplies or services. This could be due to unique capabilities, proprietary technology, or urgent and compelling circumstances. Without access to the specific justification documentation (e.g., a Justification and Approval document), the precise reasons remain unknown. However, the nature of specialized navigation and detection systems often involves complex, integrated technologies that may be held by a limited number of entities.

How does the contract's value compare to similar procurements for navigation systems?

Direct comparison is challenging without knowing the exact specifications and quantities of the systems procured under this $120 million contract. However, the value suggests a significant investment in advanced maritime navigation and detection technology. To benchmark, one would need to identify comparable contracts for similar systems awarded by the U.S. Coast Guard, Department of Defense, or other maritime agencies. Factors like system complexity, technological sophistication, and the number of units procured would heavily influence price. The absence of competition here makes a direct value-for-money assessment difficult without further data.

What are the potential risks associated with a sole-source award for critical navigation systems?

The primary risk of a sole-source award is the potential for inflated costs due to the lack of competitive pressure. Without competing bids, the government may not achieve the best possible price. Another risk is contractor complacency; a sole-source provider might have less incentive to innovate or maintain high service levels compared to a contractor facing market competition. Furthermore, reliance on a single supplier can create vulnerabilities in the supply chain, making the Coast Guard susceptible to disruptions if the contractor faces production issues, financial instability, or other unforeseen problems.

What is the track record of Integrated Coast Guard Systems LLC in delivering similar systems?

Information on the specific track record of 'Integrated Coast Guard Systems LLC' for delivering these particular navigation, detection, and guidance systems is not provided in the data. As this was a sole-source award, it implies the government identified this entity as the most suitable or only capable provider. A deeper dive would involve reviewing past performance evaluations, contract history, and any publicly available information on the company's experience with U.S. Coast Guard or similar federal procurements to assess their reliability and past success.

How does the duration of this contract (over 4 years) impact its overall value and risk?

A contract duration of approximately 1463 days (over 4 years) for a $120 million award indicates a substantial, long-term requirement for these systems. For the government, a longer contract can provide stability and ensure continuous availability of critical technology. However, it also locks the government into a specific solution and contractor for an extended period. This extended duration, especially without competition, increases the risk of the government overpaying if market prices for similar technologies decrease over time. It also reduces flexibility to adopt newer, potentially superior technologies that emerge during the contract period.

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: $120,000,000

Exercised Options: $120,000,000

Current Obligation: $120,000,000

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: DTCG2302C2DW001

IDV Type: IDC

Timeline