DoD's $232M R&D Contract for DAIRCM Awarded to DRS Network & Imaging Systems LLC
Contract Overview
Contract Amount: $231,996,962 ($232.0M)
Contractor: DRS Network & Imaging Systems LLC
Awarding Agency: Department of Defense
Start Date: 2016-03-24
End Date: 2022-11-30
Contract Duration: 2,442 days
Daily Burn Rate: $95.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: NRE; IGF::OT::IGF R&D CONTRACT FOR DAIRCM
Place of Performance
Location: DALLAS, DALLAS County, TEXAS, 75243
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $232.0 million to DRS NETWORK & IMAGING SYSTEMS LLC for work described as: NRE; IGF::OT::IGF R&D CONTRACT FOR DAIRCM Key points: 1. Significant R&D investment in optical instruments. 2. Sole-source award raises questions about competition and pricing. 3. Long contract duration (2442 days) may indicate complex project or limited options. 4. Texas-based contractor suggests regional economic impact.
Value Assessment
Rating: questionable
The contract value of $232 million is substantial for R&D in optical instruments. Without competitive bids, it's difficult to assess if this price represents fair market value or if it's inflated due to the lack of competition.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This method bypasses competitive bidding, potentially leading to higher costs and reduced innovation compared to an open competition.
Taxpayer Impact: The lack of competition in this large contract raises concerns about taxpayer value and whether funds were used most efficiently.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. The specific technology (DAIRCM) is critical for defense, impacting operational readiness. Limited visibility into the R&D process and outcomes due to sole-source nature.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- High contract value
- Long duration
Positive Signals
- Awarded to a specific company for critical defense technology
Sector Analysis
This contract falls within the Defense sector, specifically R&D for optical instruments. Defense R&D spending can be substantial, but often involves specialized technologies where competition might be limited.
Small Business Impact
The contract was awarded to DRS Network & Imaging Systems LLC, and there is no indication that small businesses were involved as subcontractors or partners in this specific award.
Oversight & Accountability
The sole-source nature of this contract warrants close oversight to ensure the contractor is meeting all milestones and that costs are reasonable and justified throughout the contract's lifecycle.
Related Government Programs
- Optical Instrument and Lens Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Limited transparency
- Long contract duration may indicate inefficiencies
Tags
optical-instrument-and-lens-manufacturin, department-of-defense, tx, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $232.0 million to DRS NETWORK & IMAGING SYSTEMS LLC. NRE; IGF::OT::IGF R&D CONTRACT FOR DAIRCM
Who is the contractor on this award?
The obligated recipient is DRS NETWORK & IMAGING SYSTEMS LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $232.0 million.
What is the period of performance?
Start: 2016-03-24. End: 2022-11-30.
What specific factors justified the sole-source award for this critical defense technology, and were alternatives explored?
Sole-source awards are typically justified by unique capabilities, urgent needs, or lack of viable alternatives. For this DAIRCM R&D contract, the justification would likely stem from proprietary technology or specialized expertise held by DRS Network & Imaging Systems LLC. A thorough review would confirm if market research was conducted to ensure no other capable sources existed or if specific national security concerns precluded a competitive process.
How does the cost-plus-fixed-fee structure impact the contractor's incentive to control costs on this $232 million R&D project?
The Cost Plus Fixed Fee (CPFF) structure means the contractor is reimbursed for allowable costs plus a predetermined fixed fee. While the fee is fixed, the contractor has an incentive to incur costs to ensure project completion and potentially secure future work. However, it provides less incentive for aggressive cost control compared to fixed-price contracts, necessitating robust government oversight to monitor expenditures and ensure efficiency.
What are the long-term implications of awarding such a significant R&D contract on a sole-source basis for future defense technology development?
Sole-source awards, while sometimes necessary, can stifle innovation and competition in the long run. Over-reliance on this method may discourage new entrants and reduce the overall technological advancement within the defense industrial base. It could also lead to higher acquisition costs for future systems if a competitive market is not fostered.
Industry Classification
NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Optical Instrument and Lens Manufacturing
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leonardo SPA
Address: 100 N BABCOCK ST, MELBOURNE, FL, 32935
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: $231,996,962
Exercised Options: $231,996,962
Current Obligation: $231,996,962
Actual Outlays: $7,313,351
Subaward Activity
Number of Subawards: 191
Total Subaward Amount: $27,355,933
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2016-03-24
Current End Date: 2022-11-30
Potential End Date: 2022-11-30 00:00:00
Last Modified: 2022-05-04
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