DHS awards $72.7M for 550 advanced threat detection systems under existing IDIQ

Contract Overview

Contract Amount: $72,747,213 ($72.7M)

Contractor: Smiths Detection Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2014-04-01

End Date: 2015-03-31

Contract Duration: 364 days

Daily Burn Rate: $199.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: DELIVERY ORDER UNDER THE SMITHS DETECTION IDIQ CONTRACT FOR THE PURCHASE OF 550 AT-2 TIER 1 SYSTEMS AND ASSOCIATED SERVICES AND ANCILLARY EQUIPMENT.

Place of Performance

Location: EDGEWOOD, HARFORD County, MARYLAND, 21040

State: Maryland Government Spending

Plain-Language Summary

Department of Homeland Security obligated $72.7 million to SMITHS DETECTION INC. for work described as: DELIVERY ORDER UNDER THE SMITHS DETECTION IDIQ CONTRACT FOR THE PURCHASE OF 550 AT-2 TIER 1 SYSTEMS AND ASSOCIATED SERVICES AND ANCILLARY EQUIPMENT. Key points: 1. Contract value represents a significant investment in national security screening capabilities. 2. Competition dynamics suggest a potentially competitive bidding process for this delivery order. 3. Performance period is relatively short, indicating a focused deployment or upgrade. 4. The acquisition aligns with TSA's mission to secure transportation networks. 5. This purchase falls within the broader category of specialized detection equipment manufacturing.

Value Assessment

Rating: good

The total award of $72.7 million for 550 systems and associated services appears reasonable given the specialized nature of the equipment. Benchmarking against similar advanced threat detection systems is challenging without more specific technical details. However, the firm-fixed-price contract type suggests that the government has locked in costs, mitigating some financial risk. The prior benchmark of $199,855 for a previous delivery order under the same IDIQ provides some context, though this current award is for a larger quantity and potentially different configurations.

Cost Per Unit: Approximately $132,267 per system (based on 550 systems and $72.7M total award, excluding ancillary services).

Competition Analysis

Competition Level: full-and-open

This delivery order was awarded under the Smiths Detection IDIQ contract, which itself was presumably competed. The specific award mechanism for this delivery order is not detailed, but the 'FULL AND OPEN COMPETITION' designation suggests that multiple bidders were considered or had the opportunity to bid. The presence of 3 bidders for this specific order indicates a degree of competition, which is generally favorable for price discovery and achieving value for money.

Taxpayer Impact: Full and open competition, with multiple bidders, generally leads to more competitive pricing, potentially saving taxpayer dollars compared to sole-source or limited competition awards.

Public Impact

Passengers and cargo screened at transportation hubs will benefit from enhanced security. The Transportation Security Administration (TSA) will receive advanced threat detection capabilities. The primary geographic impact will be at airports and other transportation facilities nationwide. This contract supports jobs in the advanced manufacturing and defense technology sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if the IDIQ contract heavily favors a single manufacturer.
Ensuring the 'associated services and ancillary equipment' are competitively priced within the order.
The effectiveness of the 'at-2 tier 1 systems' in real-world threat detection scenarios needs ongoing validation.

Positive Signals

Awarded under a pre-existing IDIQ contract, suggesting a streamlined procurement process.
Firm-fixed-price contract type provides cost certainty for the government.
Multiple bidders participated in this specific delivery order, indicating market interest and competition.

Sector Analysis

This contract falls within the broader defense and security sector, specifically focusing on the manufacturing of search, detection, navigation, guidance, aeronautical, and nautical systems and instruments. The market for advanced threat detection technology is highly specialized, driven by government procurement needs for national security and public safety. Spending in this area is often characterized by long development cycles, high R&D costs, and stringent performance requirements. Comparable spending benchmarks are difficult to establish without detailed technical specifications, but significant government investment in security screening technology is a consistent trend.

Small Business Impact

The contract details do not indicate any specific small business set-aside provisions for this delivery order. While the prime contractor is Smiths Detection Inc., it is possible that subcontracting opportunities may exist for small businesses to provide components, services, or ancillary equipment. Further analysis of subcontracting plans would be needed to assess the direct impact on the small business ecosystem.

Oversight & Accountability

The contract is subject to standard federal procurement oversight. The firm-fixed-price nature of the award provides a degree of cost control. Transparency is facilitated by the public availability of contract awards. Accountability will be managed through contract performance monitoring by the TSA and potentially through the DHS Office of Inspector General if performance issues arise or fraud is suspected.

Related Government Programs

Department of Homeland Security - Procurement
Transportation Security Administration - Equipment Acquisition
Advanced Threat Detection Systems
Indefinite Delivery/Indefinite Quantity (IDIQ) Contracts
Smiths Detection Inc. - Federal Contracts

Risk Flags

Potential for cost creep in ancillary services.
Need for ongoing validation of system effectiveness.
Risk of technological obsolescence.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $72.7 million to SMITHS DETECTION INC.. DELIVERY ORDER UNDER THE SMITHS DETECTION IDIQ CONTRACT FOR THE PURCHASE OF 550 AT-2 TIER 1 SYSTEMS AND ASSOCIATED SERVICES AND ANCILLARY EQUIPMENT.

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 $72.7 million.

What is the period of performance?

Start: 2014-04-01. End: 2015-03-31.

What is the specific technical capability of the 'AT-2 Tier 1 Systems' being procured?

The provided data indicates the procurement is for '550 AT-2 TIER 1 SYSTEMS AND ASSOCIATED SERVICES AND ANCILLARY EQUIPMENT.' The NationalНаименование (NAICS) code 334511, 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing,' suggests these are sophisticated instruments. However, specific technical details regarding the 'AT-2 Tier 1 Systems' such as their detection capabilities (e.g., explosives, chemical agents, biological threats), resolution, speed, and integration with other systems are not publicly available in this summary. Further documentation, such as the original IDIQ contract statement of work or the specific delivery order details, would be required to ascertain the precise technical specifications and operational parameters of these systems.

How does the per-unit cost of $132,267 compare to similar advanced threat detection systems in the federal market?

Benchmarking the per-unit cost of approximately $132,267 for the 'AT-2 Tier 1 Systems' against similar advanced threat detection systems in the federal market is challenging without more granular data on the system's capabilities and the scope of 'associated services and ancillary equipment.' However, this figure appears to be in the mid-to-high range for sophisticated security screening equipment. For context, advanced baggage scanners or trace detection systems can range from tens of thousands to hundreds of thousands of dollars per unit, depending on their technological sophistication, throughput, and specific threat detection profiles. The prior benchmark of $199,855 for a different delivery order under the same IDIQ suggests variability in pricing, potentially due to quantity, configuration, or included services. A comprehensive comparison would require analyzing the technical specifications and procurement history of comparable systems acquired by agencies like DHS, DOD, and DOE.

What are the primary risks associated with this contract award?

Several risks are associated with this contract. Firstly, performance risk exists, as the effectiveness of the 'AT-2 Tier 1 Systems' in real-world scenarios needs to be validated throughout the contract period. Secondly, there's a potential for cost overruns if the 'associated services and ancillary equipment' are not managed effectively, despite the firm-fixed-price nature of the main award. Thirdly, technological obsolescence is a risk in the rapidly evolving field of threat detection; the systems procured may become outdated before the end of their expected service life. Finally, integration risk could arise if these new systems do not seamlessly interface with existing security infrastructure at various transportation hubs. Ensuring robust testing, clear performance metrics, and effective project management are key to mitigating these risks.

What is the historical spending pattern for Smiths Detection Inc. with the Department of Homeland Security?

Historical spending data for Smiths Detection Inc. with the Department of Homeland Security (DHS) indicates a consistent and significant relationship, particularly concerning security and detection equipment. The provided data shows a prior delivery order under the same IDIQ contract for $199,855, suggesting ongoing business. A broader analysis of federal procurement databases would likely reveal numerous other contracts awarded to Smiths Detection Inc. by DHS and its component agencies, such as the Transportation Security Administration (TSA), Customs and Border Protection (CBP), and others. This spending typically supports the acquisition of various screening technologies, including explosives detection systems, baggage scanners, and chemical/biological detection equipment, reflecting Smiths Detection's established position as a key supplier in the homeland security sector.

How does the competition level for this delivery order impact taxpayer value?

The fact that this delivery order saw 3 bidders, under a 'full and open competition' framework, generally bodes well for taxpayer value. Increased competition typically drives down prices as contractors vie for the award, leading to more cost-effective procurement. It also encourages innovation and ensures that the government is exposed to a range of solutions and technological advancements. While the specific IDIQ contract might have been awarded to a single entity, the competition at the delivery order level is crucial for realizing the benefits of a competitive marketplace. This suggests that the TSA is likely to have received competitive pricing for the 550 systems and associated services, maximizing the return on the $72.7 million investment.

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: ALARM, SIGNAL, SECURITY DETECTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Smiths Group PLC (UEI: 210273256)

Address: 2202 LAKESIDE BLVD, EDGEWOOD, MD, 21040

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: $74,268,638

Exercised Options: $72,747,213

Current Obligation: $72,747,213

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HSTS0410DCT2117

IDV Type: IDC

Timeline