Naval Sea Systems Command awards $48M contract for technical representative services and construction equipment

Contract Overview

Contract Amount: $47,961,759 ($48.0M)

Contractor: L3 Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2005-06-09

End Date: 2013-04-24

Contract Duration: 2,876 days

Daily Burn Rate: $16.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 200509!049152!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002405C6237 !A!N! !N! ! !20050609!20100609!016556495!008898884!008898843!N!L-3 COMMUNICATIONS CORPORATION!15825 ROXFORD ST !SYLMAR !CA!91342!77546!037!06!SYLMAR !LOS ANGELES !CALIFORNIA!+000001914481!N!N!000000000000!L038!TECH REP SVCS/CONSTRUCTION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !334290!E! !3! ! ! ! ! !20200930!B! ! !A! !C!N!U!1!001!N!1B!Z!Y!Z! ! !N!C!N! ! ! !B!B!A!A!000!A!C!N! ! ! !Y!1724!N00024!0001! !

Place of Performance

Location: SYLMAR, LOS ANGELES County, CALIFORNIA, 91342

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $48.0 million to L3 TECHNOLOGIES, INC. for work described as: 200509!049152!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002405C6237 !A!N! !N! ! !20050609!20100609!016556495!008898884!008898843!N!L-3 COMMUNICATIONS CORPORATION!15825 ROXFORD ST !SYLMAR !CA!91342!77546!037!06!SYLMAR !LOS … Key points: 1. Contract awarded for technical representative services and construction equipment, indicating a need for specialized support. 2. The contract's duration of nearly 5 years suggests a long-term requirement for these services. 3. Awarded as a definitive contract, implying a firm commitment from the Navy. 4. The 'Not Competed' status raises questions about potential cost efficiencies and market engagement. 5. The contractor, L3 Technologies, Inc., is a significant player in the defense sector. 6. The primary service area is electronics and communication equipment, a critical component of naval operations.

Value Assessment

Rating: fair

The total contract value of approximately $48 million over almost five years averages to roughly $9.6 million annually. Benchmarking this against similar contracts for technical representative services and specialized equipment is challenging without more specific service details. However, the cost-plus-fixed-fee (CPFF) contract type suggests that costs could fluctuate, and the final price might differ from the initial estimate. Further analysis would be needed to determine if the pricing reflects fair market value for the services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not openly competed. This approach is typically used when only one source is capable of meeting the agency's needs, often due to proprietary technology, unique expertise, or urgent requirements. The lack of competition means the Naval Sea Systems Command did not benefit from a bidding process that could drive down prices or encourage innovation from multiple vendors.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding, as there was no direct pressure on the contractor to offer the lowest possible price.

Public Impact

Naval operations and readiness are directly supported by the technical representative services and specialized equipment provided. Personnel involved in maintaining and operating naval communication and electronic systems benefit from the contractor's expertise. The contract supports the U.S. Navy's technological infrastructure, particularly in electronics and communication equipment. Geographic impact is likely concentrated around naval bases or operational areas where these services are required.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Sole-source awards can limit opportunities for other qualified businesses.
Cost-plus contract types can introduce cost overruns if not managed tightly.

Positive Signals

Contract awarded to a known entity (L3 Technologies) with established capabilities.
Definitive contract indicates a clear commitment and defined scope.
Long contract duration suggests a stable and ongoing need for the services.

Sector Analysis

This contract falls within the broader defense electronics and communication equipment manufacturing sector. This sector is characterized by high technological sophistication, stringent quality requirements, and significant government investment. The market size is substantial, driven by continuous modernization efforts within the Department of Defense. L3 Technologies, Inc. is a well-established contractor in this space, often providing advanced systems and support services to military branches. This specific contract likely supports critical naval communication and electronic warfare capabilities.

Small Business Impact

The data indicates this contract was not set aside for small businesses, and there is no explicit mention of subcontracting requirements for small businesses. As a sole-source award to a large corporation, it is unlikely to have direct positive implications for the small business ecosystem unless L3 Technologies voluntarily engages small businesses in its supply chain. Further investigation into subcontracting plans would be necessary to assess any indirect impact.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Naval Sea Systems Command (NAVSEA) and the Defense Contract Management Agency (DCMA). As a cost-plus-fixed-fee contract, rigorous financial oversight and auditing are crucial to ensure costs are reasonable and allocable. Transparency would be enhanced through regular reporting requirements from the contractor and potential reviews by the Government Accountability Office (GAO) or the Department of Defense Inspector General (IG) if specific concerns arise.

Related Government Programs

Naval Sea Systems Command (NAVSEA) Contracts
Defense Electronics Procurement
Technical Representative Services
Communication Equipment Manufacturing
Cost-Plus-Fixed-Fee Contracts

Risk Flags

Sole-source award may limit competition and potentially increase costs.
Cost-plus contract type carries inherent risk of cost overruns for the government.
Contract duration is significant, indicating a substantial requirement.
Specific details on 'construction equipment' are vague and require clarification.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $48.0 million to L3 TECHNOLOGIES, INC.. 200509!049152!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002405C6237 !A!N! !N! ! !20050609!20100609!016556495!008898884!008898843!N!L-3 COMMUNICATIONS CORPORATION!15825 ROXFORD ST !SYLMAR !CA!91342!77546!037!06!SYLMAR !LOS ANGELES !CALIFORNIA!+000001914481!N!N!000000000000!L038!TECH REP SVCS/CONSTRUCTION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !334290!E! !3! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is L3 TECHNOLOGIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $48.0 million.

What is the period of performance?

Start: 2005-06-09. End: 2013-04-24.

What is the specific nature of the 'technical representative services' and 'construction equipment' being procured under this contract?

The contract specifies 'TECH REP SVCS/CONSTRUCTION EQUIPMENT' under the Product Service Code (PSC) L038. Technical representative services typically involve providing expert personnel to assist with the installation, operation, maintenance, or troubleshooting of complex equipment. 'Construction equipment' in this context, especially for the Naval Sea Systems Command, might refer to specialized machinery used in naval construction, repair, or shore-based facilities, or potentially equipment related to the deployment or maintenance of naval systems. Without further details on the specific equipment or systems supported, it's difficult to ascertain the exact scope. However, the primary NAICS code (334290) points towards 'Other Communications Equipment Manufacturing,' suggesting the services and equipment are likely tied to naval communication systems.

Why was this contract awarded on a sole-source basis instead of being competed?

The contract was awarded as 'NOT COMPETED' (sole-source), indicating that the Naval Sea Systems Command determined that only one responsible source was available or could be obtained to meet the requirement. Common justifications for sole-source awards include the existence of unique capabilities, proprietary technology, urgent and compelling needs where competition is not feasible, or when the contract is a follow-on to a previously competed effort where only the original contractor possesses the necessary knowledge or infrastructure. The specific reason for this sole-source determination is not detailed in the provided data but would typically be documented in the contract award justification.

How does the cost-plus-fixed-fee (CPFF) contract type impact the overall cost and risk for the government?

A Cost-Plus-Fixed-Fee (CPFF) contract type means the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure shifts a significant portion of the cost risk to the government, as the final contract price is not fixed and can increase if costs exceed initial estimates. While it allows for flexibility and can be used when the scope of work is not precisely defined, it necessitates robust government oversight to ensure costs are reasonable and necessary. The fixed fee provides the contractor with an incentive to control costs to some extent, as their profit is capped.

What is the track record of L3 Technologies, Inc. with the Department of Defense, particularly with NAVSEA?

L3 Technologies, Inc. (now part of L3Harris Technologies) has a substantial track record as a defense contractor, frequently awarded contracts by various branches of the Department of Defense, including the Navy. Their portfolio typically includes a wide range of products and services, such as communication systems, electronic warfare equipment, sensors, and avionics. Given their size and specialization, it is common for them to receive significant contract awards. Their history with NAVSEA likely involves providing similar or related technical services and equipment essential for naval platforms and operations. A deeper dive into historical contract data would reveal the extent and nature of their past performance with NAVSEA.

What are the potential implications of the contract's end date (2010) and award date (2005) on current naval capabilities?

The contract was awarded in June 2005 and expired in June 2010, with a final completion date in April 2013. This means the services and equipment procured under this specific award are historical and no longer active. While the contract itself is concluded, the capabilities it supported may have been transitioned to newer systems, different contracts, or ongoing sustainment efforts. The fact that it was a nearly five-year contract suggests a significant, albeit now past, requirement. Understanding the evolution of these capabilities since 2010 would be necessary to assess current naval readiness and technological standing in this area.

How does the $47.9 million total value compare to other contracts for similar technical representative services?

Comparing the $47.9 million total value requires understanding the specific services and equipment provided. If these services were for highly specialized, mission-critical electronic systems on naval vessels, the cost might be within a reasonable range for a nearly five-year contract. However, without detailed service descriptions and performance metrics, a direct comparison is difficult. Generally, large-scale technical support contracts for complex defense systems can run into tens or hundreds of millions of dollars. The sole-source nature and CPFF structure also complicate direct value-for-money assessments compared to competitively bid, fixed-price contracts. Further benchmarking against contracts with similar PSCs (L038) and agencies would be needed.

Industry Classification

NAICS: Manufacturing › Communications Equipment Manufacturing › Other Communications Equipment Manufacturing

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE 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: L-3 Communications Holdings, Inc. (UEI: 008898843)

Address: 15825 ROXFORD ST, SYLMAR, CA, 91342

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline