DHS Coast Guard Spends $259M on HH-65 Engine Replacement with Integrated Coast Guard Systems LLC
Contract Overview
Contract Amount: $259,076,658 ($259.1M)
Contractor: Integrated Coast Guard Systems LLC
Awarding Agency: Department of Homeland Security
Start Date: 2004-03-12
End Date: 2005-11-18
Contract Duration: 616 days
Daily Burn Rate: $420.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: HH-65 ENGINE REPLACEMENT
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20003
Plain-Language Summary
Department of Homeland Security obligated $259.1 million to INTEGRATED COAST GUARD SYSTEMS LLC for work described as: HH-65 ENGINE REPLACEMENT Key points: 1. Significant investment in critical aviation asset maintenance. 2. Sole-source award raises questions about price discovery and competition. 3. Long-term contract duration suggests ongoing operational reliance. 4. Focus on Search, Detection, Navigation, and Guidance systems highlights core mission support.
Value Assessment
Rating: questionable
The total award amount of $259,076,658 for engine replacement is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar aviation component contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This lack of competition limits price discovery and may result in higher costs for taxpayers.
Taxpayer Impact: The absence of competition in this large contract could lead to suboptimal pricing, impacting the efficient use of taxpayer funds.
Public Impact
Ensures continued operational readiness of Coast Guard HH-65 helicopters. Supports critical search and rescue, law enforcement, and national security missions. Potential for increased costs due to sole-source procurement. Impacts the availability of specialized aviation parts and services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source procurement
- Lack of competitive pricing benchmarks
- Long contract duration
Positive Signals
- Supports critical Coast Guard aviation assets
- Addresses essential engine replacement needs
Sector Analysis
The contract falls under the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector. Spending in this area is crucial for national defense and security operations, often involving specialized and high-value components.
Small Business Impact
The data indicates this contract was awarded to Integrated Coast Guard Systems LLC and does not specify any small business participation. Sole-source contracts often bypass opportunities for small businesses to compete.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure the government received the best possible value and that the contractor's pricing is justified. Further review of the justification for sole-sourcing is recommended.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Homeland Security Contracting
- U.S. Coast Guard Programs
Risk Flags
- Sole-source award
- Potential for inflated pricing
- Limited transparency in price negotiation
- Missed opportunities for small business participation
Tags
search-detection-navigation-guidance-aer, department-of-homeland-security, dc, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Homeland Security awarded $259.1 million to INTEGRATED COAST GUARD SYSTEMS LLC. HH-65 ENGINE REPLACEMENT
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 $259.1 million.
What is the period of performance?
Start: 2004-03-12. End: 2005-11-18.
What was the justification for awarding this contract on a sole-source basis, and were alternative procurement methods considered?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. Without specific documentation, it's unclear if alternatives were explored. This lack of competition raises concerns about potential overpayment and reduced value for taxpayer money.
How does the per-unit cost of these engine replacements compare to industry benchmarks or previous procurements for similar helicopter models?
As this was a sole-source award, direct comparison to industry benchmarks or previous competitive procurements is challenging. A thorough cost analysis by the agency would be necessary to validate the pricing. Without this, it's difficult to ascertain if the government secured a fair and reasonable price.
What is the long-term impact of this sole-source contract on the Coast Guard's ability to maintain and upgrade its HH-65 fleet effectively?
Sole-source contracts can limit future flexibility and potentially increase long-term costs if the incumbent contractor does not face competitive pressure to innovate or offer competitive pricing. This could impact the Coast Guard's ability to secure cost-effective maintenance and upgrades over the lifecycle of the HH-65 fleet.
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: $624,926,848
Exercised Options: $562,586,238
Current Obligation: $259,076,658
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: DTCG2302C2DW001
IDV Type: IDC
Timeline
Start Date: 2004-03-12
Current End Date: 2005-11-18
Potential End Date: 2005-11-18 00:00:00
Last Modified: 2025-06-02
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