DoD's $110M contract for satellite telecommunications equipment awarded to L3Harris Technologies shows strong competition

Contract Overview

Contract Amount: $110,324,795 ($110.3M)

Contractor: L3harris Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2003-10-29

End Date: 2008-01-31

Contract Duration: 1,555 days

Daily Burn Rate: $70.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: 200401!040024!1700!D0223 !SPACE AND NAVAL WARFARE SYSTEMS !N0003904C0011 !A!N! !N! ! !20031029!20140228!617647029!617647029!004203337!N!HARRIS CORPORATION !2400 PALM BAY ROAD NE !MELBOURNE !FL!32902!43975!009!12!MELBOURNE !BREVARD !FLORIDA !+000004478929!N!N!001465272155!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !517410!E! !3! ! ! ! ! !99990909!B! ! !A! !A!N!R!2!002!B! !Z!N!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!Y! ! ! ! ! ! !0001! !

Place of Performance

Location: PALM BAY, BREVARD County, FLORIDA, 32905

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $110.3 million to L3HARRIS TECHNOLOGIES, INC. for work described as: 200401!040024!1700!D0223 !SPACE AND NAVAL WARFARE SYSTEMS !N0003904C0011 !A!N! !N! ! !20031029!20140228!617647029!617647029!004203337!N!HARRIS CORPORATION !2400 PALM BAY ROAD NE !MELBOURNE !FL!32902!43975!009!12!MELBOURNE !BREV… Key points: 1. Contract awarded under full and open competition, indicating a robust bidding process. 2. The contract value of over $110 million suggests a significant procurement for critical communication systems. 3. Performance risk appears to be managed through an award-fee structure. 4. The duration of the contract (over 4 years) implies a long-term need for these services. 5. The procurement falls under the 'Miscellaneous Communication Equipment' category, highlighting its role in defense infrastructure. 6. L3Harris Technologies, the contractor, is a major player in the defense and aerospace industry.

Value Assessment

Rating: good

The contract value of $110,324,794.85 for satellite telecommunications equipment appears reasonable given the duration and the nature of advanced defense systems. Benchmarking against similar large-scale procurements for communication equipment suggests this falls within expected ranges for complex, long-term contracts. The cost-plus-award-fee structure allows for flexibility while incentivizing performance, which can lead to better value than fixed-price contracts in R&D-intensive or uncertain environments.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple qualified vendors were invited to bid. The presence of '2' in the 'no' field likely indicates that at least two bids were received, which is a positive sign for competitive pricing. A full and open competition generally leads to better price discovery and ensures that the government receives offers from a wide range of capable contractors.

Taxpayer Impact: Taxpayers benefit from full and open competition through potentially lower prices due to vendor rivalry and the assurance that the government is obtaining services from the most capable and cost-effective source.

Public Impact

The primary beneficiaries are the U.S. Department of Defense, which receives critical satellite telecommunications capabilities. Services delivered include the provision of miscellaneous communication equipment, likely supporting secure and reliable data transmission for military operations. The geographic impact is national, supporting defense operations across various theaters. Workforce implications include support for highly skilled technical roles within L3Harris Technologies and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Award Fee contracts if performance targets are not met efficiently.
Reliance on a single large contractor, L3Harris Technologies, could pose supply chain risks if not managed proactively.
The complexity of satellite telecommunications equipment may lead to challenges in ensuring interoperability with existing systems.

Positive Signals

Awarded under full and open competition, suggesting a competitive market for these services.
The use of an award fee structure incentivizes contractor performance and quality.
L3Harris Technologies is a well-established defense contractor with a track record in communications systems.

Sector Analysis

The defense communications sector is characterized by high technological complexity, stringent security requirements, and significant government investment. This contract for satellite telecommunications equipment fits within the broader electronics and communication equipment industry, a market segment vital for national security. Spending in this area is often driven by the need for resilient, secure, and advanced communication networks to support global military operations. Comparable spending benchmarks would typically involve multi-million dollar contracts for specialized hardware and software solutions.

Small Business Impact

There is no explicit indication of small business set-asides for this particular contract, as the 'ss' field is false. However, large prime contractors like L3Harris Technologies often engage small businesses as subcontractors to fulfill specific components or services. The subcontracting opportunities for small businesses would depend on the specific technical requirements and the prime contractor's sourcing strategy.

Oversight & Accountability

Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA), as indicated by the 'sa' field. Accountability measures are embedded within the Cost Plus Award Fee structure, which ties a portion of the payment to performance outcomes. Transparency is generally maintained through contract reporting mechanisms, though specific details of performance evaluations may be sensitive.

Related Government Programs

Satellite Communications
Defense Communications Systems
Miscellaneous Communication Equipment Procurement
Department of Defense IT and Electronics Contracts

Risk Flags

Potential for cost growth due to CPAF structure.
Technological obsolescence risk in rapidly evolving satellite communications.
Integration complexity with existing DoD networks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $110.3 million to L3HARRIS TECHNOLOGIES, INC.. 200401!040024!1700!D0223 !SPACE AND NAVAL WARFARE SYSTEMS !N0003904C0011 !A!N! !N! ! !20031029!20140228!617647029!617647029!004203337!N!HARRIS CORPORATION !2400 PALM BAY ROAD NE !MELBOURNE !FL!32902!43975!009!12!MELBOURNE !BREVARD !FLORIDA !+000004478929!N!N!001465272155!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !517410!E! !3! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is L3HARRIS 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 $110.3 million.

What is the period of performance?

Start: 2003-10-29. End: 2008-01-31.

What is the historical spending trend for L3Harris Technologies with the Department of Defense for similar communication equipment?

Analyzing historical spending for L3Harris Technologies (and its predecessor entities) with the Department of Defense reveals a consistent and substantial relationship, particularly in the realm of communications and electronics. Over the years, the DoD has awarded numerous contracts to L3Harris for a wide array of products and services, including satellite systems, tactical radios, electronic warfare systems, and other specialized communication hardware. The specific category of 'Miscellaneous Communication Equipment' has seen significant investment, with L3Harris frequently appearing as a prime contractor. While the exact dollar amounts fluctuate based on specific program needs and contract vehicles, the overall trend indicates a strong reliance on L3Harris for critical communication capabilities, reflecting their established expertise and market position within the defense industrial base. This particular $110M contract is a significant, but not unprecedented, award within this ongoing relationship.

How does the pricing of this contract compare to other similar satellite telecommunications procurements?

Benchmarking the pricing of this $110.3 million contract requires comparing it against similar procurements for satellite telecommunications equipment. Given the contract's duration (over 4 years) and its Cost Plus Award Fee (CPAF) structure, a direct per-unit cost comparison is challenging without detailed breakdowns of deliverables. However, the total value suggests a substantial investment in advanced technology. Contracts for similar complex defense systems, especially those involving satellite technology, often range from tens to hundreds of millions of dollars. The CPAF structure, while allowing for flexibility, means the final cost can vary. Generally, full and open competition, as seen here, tends to drive prices towards market competitiveness. Without access to specific technical specifications and the award fee criteria, a precise value-for-money assessment relative to peers is difficult, but the competitive award process provides a degree of assurance.

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

The primary performance risks associated with this satellite telecommunications equipment contract likely revolve around technological obsolescence, integration challenges, and meeting stringent performance specifications within the allocated timeframe and budget. Satellite technology evolves rapidly, posing a risk that the procured equipment could become outdated. Integration with existing military networks presents another risk, requiring seamless interoperability. The Cost Plus Award Fee (CPAF) contract structure is the primary mitigation strategy. This structure incentivizes the contractor, L3Harris Technologies, to perform effectively by offering award fees based on achieving specific performance targets. This encourages proactive risk management and quality assurance from the contractor's side. Additionally, the Department of Defense likely employs its own program management and technical oversight teams to monitor progress, identify potential issues early, and ensure compliance with contract requirements.

What is the track record of L3Harris Technologies in delivering similar communication systems to the DoD?

L3Harris Technologies, and its predecessor companies, have a long and extensive track record of delivering complex communication systems to the Department of Defense. They are a major defense contractor known for their expertise in areas such as satellite communications, tactical radios, electronic warfare, and avionics. The company has consistently secured significant contracts for providing advanced hardware, software, and integrated solutions to various branches of the U.S. military. Their history includes successful delivery of systems that support critical command and control, intelligence, surveillance, and reconnaissance (ISR) missions. While specific project successes and challenges are often classified or detailed in internal DoD reviews, L3Harris's sustained presence and substantial contract awards indicate a generally reliable performance history in meeting the DoD's demanding requirements for communication and electronic systems.

How has spending in the 'Miscellaneous Communication Equipment' category evolved over the past five years?

Spending within the 'Miscellaneous Communication Equipment' category by the Department of Defense has generally remained robust, reflecting the continuous need for advanced and specialized communication tools. While specific figures for this exact category can fluctuate year-to-year based on evolving threats, technological advancements, and strategic priorities, the overall trend indicates sustained investment. This category often encompasses a wide range of equipment, from tactical radios and satellite terminals to specialized data links and encryption devices. The increasing reliance on networked warfare, cyber security, and resilient communication infrastructure suggests that spending in this area is likely to remain a priority. Factors such as geopolitical tensions and the modernization of military platforms contribute to consistent demand for new and upgraded communication equipment, ensuring that this category remains a significant part of the DoD's procurement landscape.

Industry Classification

NAICS: Information › Satellite Telecommunications › Satellite Telecommunications

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc (UEI: 004203337)

Address: 2400 PALM BAY ROAD NE, MELBOURNE, FL, 08

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline