DHS awards $66.5M for Electronic Equipment Repair, highlighting potential value concerns with sole-source contract
Contract Overview
Contract Amount: $66,465,892 ($66.5M)
Contractor: Leidos Security Detection & Automation, Inc.
Awarding Agency: Department of Homeland Security
Start Date: 2012-07-01
End Date: 2013-06-30
Contract Duration: 364 days
Daily Burn Rate: $182.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: TIME AND MATERIALS
Sector: Other
Official Description: L-3 COMMUNICATIONS HSTS04-11-R-CT3006
Place of Performance
Location: ARLINGTON, LOUDOUN County, VIRGINIA, 20598
State: Virginia Government Spending
Plain-Language Summary
Department of Homeland Security obligated $66.5 million to LEIDOS SECURITY DETECTION & AUTOMATION, INC. for work described as: L-3 COMMUNICATIONS HSTS04-11-R-CT3006 Key points: 1. Contract value of $66.5M for repair services. 2. Sole-source award to Leidos Security Detection & Automation, Inc. 3. Potential risk due to lack of competition. 4. Services fall under 'Other Electronic and Precision Equipment Repair and Maintenance'.
Value Assessment
Rating: questionable
The contract's Time and Materials (T&M) pricing structure, combined with a sole-source award, raises questions about cost efficiency. Without competitive bidding, it's difficult to benchmark against market rates for similar repair services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning no other vendors were considered. This significantly limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition in this sole-source award may result in taxpayers paying more than necessary for the electronic equipment repair services.
Public Impact
Taxpayers may be overpaying for essential repair services due to the absence of competitive bidding. Reliance on a single vendor could impact service quality and responsiveness over time. Lack of transparency in pricing due to sole-source nature.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Time and Materials pricing
- Lack of competition
Positive Signals
- Essential service for TSA operations
Sector Analysis
This contract falls within the 'Other Electronic and Precision Equipment Repair and Maintenance' sector. Spending in this area is critical for maintaining operational readiness of specialized equipment, but competitive procurement is key to ensuring value.
Small Business Impact
The contract was not awarded to a small business. There is no indication of subcontracting opportunities for small businesses within this sole-source award.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure the Department of Homeland Security obtained fair pricing and that the necessity for a sole-source justification was thoroughly documented.
Related Government Programs
- Other Electronic and Precision Equipment Repair and Maintenance
- Department of Homeland Security Contracting
- Transportation Security Administration Programs
Risk Flags
- Sole-source award limits competition.
- Time and Materials pricing can lead to cost uncertainty.
- Potential for overpayment due to lack of price discovery.
- No small business participation noted.
Tags
other-electronic-and-precision-equipment, department-of-homeland-security, va, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Homeland Security awarded $66.5 million to LEIDOS SECURITY DETECTION & AUTOMATION, INC.. L-3 COMMUNICATIONS HSTS04-11-R-CT3006
Who is the contractor on this award?
The obligated recipient is LEIDOS SECURITY DETECTION & AUTOMATION, 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 $66.5 million.
What is the period of performance?
Start: 2012-07-01. End: 2013-06-30.
What was the justification for awarding this contract on a sole-source basis, and was it adequately documented?
The provided data does not include the specific justification for the sole-source award. Typically, such justifications require demonstrating that only one vendor can meet the requirement due to unique capabilities, urgency, or specific circumstances. A thorough review of the contract file would be necessary to assess the adequacy of the documentation and ensure it aligns with federal procurement regulations.
How does the Time and Materials pricing compare to industry benchmarks for similar repair services, given the lack of competition?
Without competitive bids, directly comparing the T&M rates to industry benchmarks is challenging. However, T&M contracts can be susceptible to cost overruns if not closely monitored. The government should have established internal benchmarks or sought independent cost analysis to validate the reasonableness of the rates charged by Leidos.
What measures are in place to ensure the effectiveness and quality of repair services provided by Leidos under this sole-source contract?
While competition is absent, the TSA should have robust performance metrics and quality assurance processes in place. This includes regular performance reviews, tracking of service level agreements, and mechanisms for addressing any deficiencies in service delivery to ensure the equipment is effectively maintained.
Industry Classification
NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Other Electronic and Precision Equipment Repair and Maintenance
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: TIME AND MATERIALS (Y)
Evaluated Preference: NONE
Contractor Details
Parent Company: L-3 Communications Holdings, Inc. (UEI: 008898843)
Address: 10E COMMERCE WAY, WOBURN, MA, 05
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: $66,465,892
Exercised Options: $66,465,892
Current Obligation: $66,465,892
Contract Characteristics
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: HSTS0411DCT3083
IDV Type: IDC
Timeline
Start Date: 2012-07-01
Current End Date: 2013-06-30
Potential End Date: 2013-06-30 00:00:00
Last Modified: 2014-11-20
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