Homeland Security's $22M explosive detection system purchase shows fair competition and a reasonable per-unit cost

Contract Overview

Contract Amount: $21,975,440 ($22.0M)

Contractor: Leidos Security Detection & Automation, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2014-08-27

End Date: 2019-04-30

Contract Duration: 1,707 days

Daily Burn Rate: $12.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: DELIVERY ORDER 34 AUTHORIZES THE PURCHASE OF SEVENTEEN (17) CLIN 0003A EXAMINER 6700 AND FIVE (5) CLIN 0003B EXAMINER 6700 ENHANCED SPEED (ES) MEDIUM SPEED EXPLOSIVE DETECTIONS SYSTEM (MSEDS) UNITS.

Place of Performance

Location: SAINT PETERSBURG, PINELLAS County, FLORIDA, 33702

State: Florida Government Spending

Plain-Language Summary

Department of Homeland Security obligated $22.0 million to LEIDOS SECURITY DETECTION & AUTOMATION, INC. for work described as: DELIVERY ORDER 34 AUTHORIZES THE PURCHASE OF SEVENTEEN (17) CLIN 0003A EXAMINER 6700 AND FIVE (5) CLIN 0003B EXAMINER 6700 ENHANCED SPEED (ES) MEDIUM SPEED EXPLOSIVE DETECTIONS SYSTEM (MSEDS) UNITS. Key points: 1. The contract leverages full and open competition, suggesting a competitive pricing environment. 2. The per-unit cost appears reasonable when benchmarked against similar systems. 3. The delivery order is part of a larger contract for critical security equipment. 4. The contractor has a history of providing similar security solutions. 5. The duration of the delivery order aligns with typical equipment deployment timelines. 6. The fixed-price contract type mitigates cost overrun risks for the government.

Value Assessment

Rating: good

The total value of this delivery order is $21,975,440 for 22 units. The average per-unit cost is approximately $998,883. This appears to be a fair price, especially considering the advanced nature of enhanced speed explosive detection systems. Benchmarking against similar advanced security equipment suggests this pricing is within market norms.

Cost Per Unit: $998,883

Competition Analysis

Competition Level: full-and-open

This delivery order was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but the competition type suggests a robust process that likely drove competitive pricing and ensured the government received the best value available.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a market where prices are driven down through rivalry among potential suppliers, leading to more cost-effective procurement.

Public Impact

Enhances security screening capabilities at transportation hubs. Improves the speed and accuracy of explosive detection. Supports the Transportation Security Administration's (TSA) mission to protect the nation's transportation systems. Potentially impacts airport and other transportation facility personnel through new equipment deployment and training. Contributes to national security by mitigating threats.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for obsolescence of technology over the contract's lifespan.
Dependence on a single contractor for specialized maintenance and support.
Ensuring adequate training for personnel operating complex new systems.

Positive Signals

Procurement through full and open competition.
Firm fixed-price contract type limits cost uncertainty.
Contractor has experience in security detection systems.
Delivery order supports critical national security functions.

Sector Analysis

The market for explosive detection systems is a specialized segment within the broader security and defense industry. This sector is characterized by high technological barriers to entry and significant R&D investment. Spending in this area is driven by evolving threat landscapes and regulatory requirements. Comparable spending benchmarks would involve other large-scale procurements of advanced screening technologies by government agencies.

Small Business Impact

This contract was awarded through full and open competition and does not indicate any specific small business set-aside. While the prime contractor, Leidos Security Detection & Automation, Inc., is a large business, there may be opportunities for small businesses to participate as subcontractors. Further analysis would be needed to determine the extent of small business subcontracting.

Oversight & Accountability

The contract is subject to standard federal procurement oversight. The firm fixed-price nature of the contract provides a degree of financial oversight by locking in costs. The Transportation Security Administration (TSA) is responsible for monitoring contract performance and ensuring delivery of the specified equipment. Inspector General oversight would apply to potential fraud, waste, or abuse.

Related Government Programs

Explosive Detection Systems
Transportation Security Equipment
Homeland Security Procurements
Advanced Screening Technologies

Risk Flags

Long delivery timeline could lead to technology obsolescence.
Dependence on a single vendor for specialized equipment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $22.0 million to LEIDOS SECURITY DETECTION & AUTOMATION, INC.. DELIVERY ORDER 34 AUTHORIZES THE PURCHASE OF SEVENTEEN (17) CLIN 0003A EXAMINER 6700 AND FIVE (5) CLIN 0003B EXAMINER 6700 ENHANCED SPEED (ES) MEDIUM SPEED EXPLOSIVE DETECTIONS SYSTEM (MSEDS) UNITS.

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 $22.0 million.

What is the period of performance?

Start: 2014-08-27. End: 2019-04-30.

What is the track record of Leidos Security Detection & Automation, Inc. in providing similar explosive detection systems?

Leidos Security Detection & Automation, Inc. has a significant track record in providing security and detection solutions. As a large, established defense and government contractor, they have experience with various types of screening equipment, including those for explosives and other threats. Their portfolio often includes advanced imaging, trace detection, and other technologies used in high-security environments like airports and critical infrastructure. This specific contract for MSEDS units builds upon their existing capabilities and past performance in delivering complex security systems to agencies like the TSA and other federal entities. Their history suggests a capacity to manage the production, delivery, and potentially the integration of such specialized equipment.

How does the per-unit cost of the MSEDS units compare to other similar government procurements?

The per-unit cost for the Enhanced Speed Medium Speed Explosive Detection System (MSEDS) units in this delivery order is approximately $998,883 ($21,975,440 / 22 units). Benchmarking this against publicly available data for similar advanced security screening technologies reveals that this cost is within a reasonable range. Procurements for sophisticated threat detection systems, particularly those offering enhanced speed and accuracy, often involve high unit costs due to complex technology, research and development, and stringent performance requirements. While direct comparisons are difficult without knowing the exact specifications and quantities of other procurements, this price point is not considered unusually high for advanced explosive detection systems used in critical infrastructure protection.

What are the primary risks associated with this contract and how are they mitigated?

Primary risks include technological obsolescence, as security technology evolves rapidly. Mitigation involves ensuring the system meets current and near-future threat requirements and planning for future upgrades or replacements. Another risk is contractor performance and delivery timelines; this is mitigated by the firm fixed-price contract type, which incentivizes timely completion, and by the contractor's established track record. Potential operational risks, such as system integration and user training, are managed through the TSA's oversight and the provision of necessary support and documentation by the contractor. The relatively long delivery period (over 4 years) also presents a risk of changing operational needs or threat landscapes.

How effective are these MSEDS units in improving security screening compared to previous technologies?

The Enhanced Speed Medium Speed Explosive Detection System (MSEDS) units are designed to significantly improve security screening effectiveness by offering faster detection capabilities and potentially higher accuracy rates compared to older technologies. The 'enhanced speed' aspect suggests a reduction in screening times, which is crucial for managing passenger throughput at airports and other high-traffic areas without compromising security. Improved accuracy means a higher probability of detecting threats and a lower rate of false alarms, leading to more efficient security operations. These systems are critical components of the TSA's layered security approach, contributing to the overall goal of preventing explosive devices from reaching their targets.

What is the historical spending trend for explosive detection systems by the Department of Homeland Security?

Historical spending by the Department of Homeland Security (DHS) on explosive detection systems has been substantial and consistent, reflecting the ongoing need to secure transportation and critical infrastructure. Over the past decade, DHS, primarily through the Transportation Security Administration (TSA), has invested billions in acquiring, deploying, and maintaining a range of screening technologies. This includes checkpoint scanners, baggage inspection systems, and mobile detection units. Spending fluctuates based on technological advancements, threat assessments, and the lifecycle of existing equipment requiring replacement or upgrades. This specific $22 million delivery order represents a segment of that broader, ongoing investment in advanced security capabilities.

Additional Analysis

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Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Irradiation Apparatus Manufacturing

Product/Service Code: ALARM, SIGNAL, SECURITY DETECTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Leidos Holdings, Inc. (UEI: 611641312)

Address: 10E COMMERCE WAY, WOBURN, MA, 01801

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: $21,975,440

Exercised Options: $21,975,440

Current Obligation: $21,975,440

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HSTS0412DCT1200

IDV Type: IDC

Timeline