DHS awarded $76M for 80 CTX 9000 units to Smiths Detection, Inc. in 2007

Contract Overview

Contract Amount: $76,080,000 ($76.1M)

Contractor: Smiths Detection, Inc

Awarding Agency: Department of Homeland Security

Start Date: 2007-06-26

End Date: 2010-03-30

Contract Duration: 1,008 days

Daily Burn Rate: $75.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: TO PURCHASE 80 CTX 9000 UNITS.

Place of Performance

Location: NEWARK, ALAMEDA County, CALIFORNIA, 94560

State: California Government Spending

Plain-Language Summary

Department of Homeland Security obligated $76.1 million to SMITHS DETECTION, INC for work described as: TO PURCHASE 80 CTX 9000 UNITS. Key points: 1. The contract value of $76.08 million for 80 units suggests a per-unit cost of approximately $951,000. 2. This award was not competed, raising questions about potential price discovery and value for money. 3. The contract duration of 1008 days (approximately 2.7 years) indicates a medium-term supply agreement. 4. The firm fixed-price contract type generally transfers risk to the contractor, potentially stabilizing costs. 5. The absence of small business set-aside suggests this procurement was not specifically targeted for smaller enterprises. 6. The Transportation Security Administration (TSA) is the primary agency, indicating a focus on security screening technology.

Value Assessment

Rating: questionable

The awarded amount of $76.08 million for 80 CTX 9000 units translates to a per-unit cost of $951,000. Without direct comparable contract data for the CTX 9000 model from the same period, it is difficult to definitively benchmark this price. However, given the non-competitive nature of the award, there is a risk that the price may not reflect the best value achievable through a competitive process. Further analysis would require access to historical pricing data for similar security screening equipment.

Cost Per Unit: $951,000 per unit

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor can provide the required goods or services, or in cases of urgent need. The lack of competition means that the government did not benefit from the price reductions and innovation that can arise from a competitive bidding process.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competition. Without a competitive bidding process, there is less pressure on the contractor to offer the lowest possible price, potentially leading to higher overall spending.

Public Impact

The primary beneficiaries are the Transportation Security Administration (TSA) and the traveling public, who benefit from enhanced security screening capabilities. The contract delivers 80 CTX 9000 units, which are advanced explosive detection systems used at airports. The geographic impact is likely concentrated at major airports and transportation hubs across the United States where TSA operates. The acquisition of this technology supports the federal government's mission to ensure transportation security and public safety.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Non-competitive award limits price discovery and potentially increases cost to taxpayers.
Lack of transparency in the sole-source justification could obscure potential alternatives or better pricing.
High per-unit cost without competitive benchmarking raises concerns about value for money.
Contract duration and value may indicate a significant reliance on a single supplier for critical security equipment.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Procurement of advanced security technology directly supports national security objectives.
Smiths Detection is a known provider of security screening equipment, suggesting potential expertise.

Sector Analysis

The market for security screening equipment, particularly for aviation and transportation, is a specialized sector within the broader defense and security industry. Companies like Smiths Detection are key players, often holding proprietary technology. Government procurements in this area are critical for national security but can be susceptible to sole-source awards due to the unique nature of the technology and the established relationships between government agencies and specific vendors. Benchmarking spending in this niche requires comparing against similar advanced screening systems rather than general equipment categories.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the procurement was either awarded to a large business or that the nature of the specialized security equipment did not lend itself to a small business set-aside. There is no information provided regarding subcontracting plans, so the impact on the small business ecosystem is not directly discernible from this data alone.

Oversight & Accountability

Oversight for this contract would fall under the Department of Homeland Security (DHS) and specifically the Transportation Security Administration (TSA). As a sole-source award, the justification and approval process would be subject to specific federal acquisition regulations and potentially internal DHS oversight. Transparency regarding the rationale for the sole-source award and the subsequent performance monitoring would be key accountability measures. Inspector General reviews could be initiated if concerns regarding the procurement process or contract performance arise.

Related Government Programs

Homeland Security Grants Program
Airport Improvement Program
Federal Aviation Administration (FAA) Security Equipment Procurements
Department of Defense (DoD) Security Equipment

Risk Flags

Sole-source award
Lack of competitive bidding
High per-unit cost without clear benchmark
Potential for non-optimal value for money

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $76.1 million to SMITHS DETECTION, INC. TO PURCHASE 80 CTX 9000 UNITS.

Who is the contractor on this award?

The obligated recipient is SMITHS DETECTION, INC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Transportation Security Administration).

What is the total obligated amount?

The obligated amount is $76.1 million.

What is the period of performance?

Start: 2007-06-26. End: 2010-03-30.

What is the specific model and function of the CTX 9000 units being purchased?

The CTX 9000 is an advanced explosive detection system (EDS) manufactured by Smiths Detection. These units are primarily used for screening checked baggage at airports to detect the presence of explosives. The system utilizes technologies such as computed tomography (CT) scanning and advanced algorithms to identify threats. The purchase of 80 units indicates a significant investment in upgrading or expanding the baggage screening capabilities at numerous transportation security checkpoints.

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

The provided data indicates the contract was 'NOT COMPETED'. While the specific justification is not detailed, sole-source awards are typically made when only one responsible source is available or capable of meeting the agency's needs. This could be due to proprietary technology, unique capabilities, urgent and compelling circumstances, or a lack of viable alternatives in the market at the time of procurement. A thorough review of the contract file and associated documentation would be necessary to ascertain the precise justification used by the Transportation Security Administration.

How does the per-unit cost of $951,000 compare to similar security screening equipment at the time?

Benchmarking the per-unit cost of $951,000 for the CTX 9000 requires comparative data for similar advanced explosive detection systems procured around 2007. Without access to specific historical pricing for competing EDS models from that era, a direct comparison is challenging. However, given the specialized nature and advanced technology of EDS units, costs in the high hundreds of thousands to over a million dollars per unit were not uncommon for state-of-the-art systems. The non-competitive nature of this award, however, raises a flag that this price might not represent the lowest achievable market rate.

What is the track record of Smiths Detection, Inc. with government contracts, particularly with DHS/TSA?

Smiths Detection, Inc. is a well-established provider of security screening technology and has a significant history of supplying equipment to government agencies, including the Department of Homeland Security (DHS) and the Transportation Security Administration (TSA). They are known for their CTX series of explosive detection systems, which have been a staple in airport security for many years. Their extensive experience and existing relationship with the TSA likely played a role in their ability to secure contracts, including sole-source awards, for critical security infrastructure.

What are the potential risks associated with a sole-source award for critical security equipment?

The primary risk of a sole-source award for critical security equipment like the CTX 9000 is the potential for inflated pricing due to the lack of competitive pressure. This can lead to a lower return on investment for taxpayers. Additionally, reliance on a single supplier can create vulnerabilities if that supplier faces production issues, financial instability, or decides to discontinue a product line. It can also stifle innovation by reducing the incentive for alternative providers to develop competing technologies. Ensuring robust contract oversight and performance management becomes even more critical in sole-source situations.

What was the total federal spending on similar security screening equipment during the contract period (2007-2010)?

Determining the total federal spending on similar security screening equipment between 2007 and 2010 would require a comprehensive search across various federal databases and contract award portals, filtering by Product Service Code (PSC) and North American Industry Classification System (NAICS) codes relevant to security screening technology, and potentially by agency (e.g., DHS, TSA, DoD). This specific contract represents $76.08 million of that spending. Aggregating all similar procurements would provide a broader market context but is beyond the scope of analysis for this single contract data point.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Architectural Services

Product/Service Code: ALARM, SIGNAL, SECURITY DETECTION

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Safran Power USA LLC (UEI: 275374015)

Address: 7151 GATEWAY BLVD, NEWARK, CA, 17

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Federally Funded Research and Development Corp, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $76,080,000

Exercised Options: $76,080,000

Current Obligation: $76,080,000

Parent Contract

Parent Award PIID: DTSA2003C01900

IDV Type: IDC

Timeline