DoD awards $48M for STAR SAFIRE 380-HD systems, a sole-source contract to Teledyne FLIR

Contract Overview

Contract Amount: $47,994,957 ($48.0M)

Contractor: Teledyne Flir, LLC

Awarding Agency: Department of Defense

Start Date: 2011-08-29

End Date: 2013-09-30

Contract Duration: 763 days

Daily Burn Rate: $62.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: STAR SAFIRE 380-HD SYSTEM

Place of Performance

Location: WILSONVILLE, CLACKAMAS County, OREGON, 97070

State: Oregon Government Spending

Plain-Language Summary

Department of Defense obligated $48.0 million to TELEDYNE FLIR, LLC for work described as: STAR SAFIRE 380-HD SYSTEM Key points: 1. The contract value of $47.99M for the STAR SAFIRE 380-HD system appears to be a significant investment in advanced surveillance technology. 2. As a sole-source award, the absence of competition raises questions about potential price inflation and the best use of taxpayer funds. 3. The contract duration of approximately 763 days (from 2011 to 2013) suggests a focused, albeit relatively short-term, procurement. 4. The specific NAICS code (334511) indicates a focus on manufacturing search, detection, navigation, guidance, and related systems. 5. The contract was awarded by the Department of the Navy, highlighting its importance for naval operations and surveillance capabilities. 6. The absence of small business set-aside flags suggests this procurement was not specifically targeted to support small businesses.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without more detailed cost breakdowns or comparisons to similar sole-source procurements for advanced electro-optical systems. The fixed price nature of the contract provides some cost certainty, but the lack of competition means there's no direct market price discovery to assess if the $47.99M represents a fair and reasonable price. Further analysis would require understanding the specific capabilities and technological advancements offered by the STAR SAFIRE 380-HD system compared to available alternatives, if any.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Teledyne FLIR, LLC, was solicited. This typically occurs when a specific technology or capability is unique to a single provider, or in cases of urgent need where competition is not feasible. The lack of competition limits the government's ability to negotiate pricing based on multiple offers and may result in a higher price than if multiple vendors had competed.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no competitive pressure to drive down prices. This means taxpayer funds may not be utilized as efficiently as they could be in a competitive bidding environment.

Public Impact

The primary beneficiaries are the Department of the Navy and its operational units, who receive advanced surveillance and targeting systems. The STAR SAFIRE 380-HD system likely enhances situational awareness, intelligence gathering, and operational effectiveness for naval forces. The geographic impact is primarily within naval operational theaters, supporting missions globally. The contract supports the manufacturing workforce within Teledyne FLIR and its supply chain, likely in Oregon where the company has a presence.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially leading to higher costs for taxpayers.
Lack of transparency inherent in sole-source procurements makes it difficult to assess true value for money.
Contract awarded in 2011 with an end date in 2013; current operational relevance and supportability of the awarded systems need verification.
No indication of small business participation or subcontracting goals, potentially missing opportunities to support smaller enterprises.

Positive Signals

Procurement of advanced surveillance technology likely enhances critical defense capabilities.
Firm Fixed Price contract provides cost certainty for the government once awarded.
Award to a known entity (Teledyne FLIR) suggests a reliance on established technology and supplier relationships.

Sector Analysis

The contract falls within the Defense industry, specifically the manufacturing of advanced sensor and navigation systems. The market for such systems is characterized by high technological barriers to entry, significant R&D investment, and a concentrated number of specialized suppliers. Spending in this sector is driven by national security requirements and the continuous need for technological superiority. Comparable spending benchmarks would involve other procurements of advanced electro-optical/infrared (EO/IR) systems for military applications.

Small Business Impact

This contract does not appear to have included any small business set-aside provisions, nor is there information indicating subcontracting goals for small businesses. This suggests that the primary focus was on acquiring a specific, potentially complex, technological system from a large prime contractor. Consequently, there may have been limited direct opportunities for small businesses to participate in this specific procurement, although they might be involved further down the supply chain.

Oversight & Accountability

Oversight for this contract would have been managed by the Department of the Navy's contracting and program management offices. As a firm-fixed-price contract, the primary oversight would focus on delivery schedule, quality of goods, and adherence to specifications. Transparency is limited due to the sole-source nature. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected during the procurement or execution phases.

Related Government Programs

Defense Advanced Research Projects Agency (DARPA) programs
Tactical Surveillance Systems
Naval Aviation Systems
Electro-Optical/Infrared (EO/IR) Systems
Intelligence, Surveillance, and Reconnaissance (ISR) Platforms

Risk Flags

Sole-source award
Lack of competition
Potential for price inflation
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $48.0 million to TELEDYNE FLIR, LLC. STAR SAFIRE 380-HD SYSTEM

Who is the contractor on this award?

The obligated recipient is TELEDYNE FLIR, 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 $48.0 million.

What is the period of performance?

Start: 2011-08-29. End: 2013-09-30.

What is the specific operational capability provided by the STAR SAFIRE 380-HD system, and how does it compare to other available systems?

The STAR SAFIRE 380-HD is an advanced, high-definition, multi-sensor airborne electro-optical/infrared (EO/IR) imaging system. It is designed for surveillance, reconnaissance, and targeting missions, providing operators with real-time visual data in various conditions, including day, night, and adverse weather. Its capabilities typically include high-magnification zoom, advanced image stabilization, and the ability to track targets. Compared to other systems, the 380-HD is known for its robust performance in demanding environments and its integration into various aircraft platforms. However, without specific comparative data from the time of procurement or current market analysis, it's difficult to definitively state its superiority over all alternatives. Sole-source awards often imply unique capabilities, but also limit direct comparison.

Given the sole-source nature, how can the government ensure it received fair market value for the $47.99M awarded?

Ensuring fair market value in sole-source procurements is challenging but relies on several mechanisms. The government would have likely conducted extensive market research to confirm that Teledyne FLIR was indeed the only source capable of meeting the requirement, or that competition was otherwise not feasible. They would also have assessed the contractor's proposed price against historical pricing for similar systems, independent cost estimates, and potentially certified cost or pricing data if applicable. The firm-fixed-price contract type itself aims to cap the government's liability. However, without competitive bids, the government lacks the direct price discovery that competition provides, making the assessment of 'fair value' more reliant on internal analysis and negotiation leverage.

What are the potential risks associated with acquiring advanced defense systems through sole-source contracts?

The primary risks associated with sole-source contracts for advanced defense systems include higher costs due to the lack of competitive pricing pressure, potential for vendor lock-in where the government becomes overly reliant on a single supplier, and reduced innovation as the vendor may face less incentive to improve offerings. There's also a risk of inadequate technical solutions if the sole-source provider's capabilities are not fully aligned with evolving requirements. Furthermore, the lack of transparency can obscure potential inefficiencies or suboptimal performance. For taxpayers, the risk is that funds are not used as efficiently as possible, potentially diverting resources from other critical needs.

What was the historical spending trend for similar systems or by the Department of the Navy in this category prior to this award?

Analyzing historical spending trends for similar systems prior to August 2011 would require access to extensive historical contract databases. However, the Department of the Navy has consistently invested heavily in advanced surveillance and targeting systems, including EO/IR platforms, to maintain operational superiority. Spending in this category is typically driven by technological advancements, evolving threats, and the need to equip naval aviation and surface vessels with state-of-the-art capabilities. Without specific data points, it's reasonable to assume that procurements of sophisticated airborne sensor systems represent a significant and ongoing expenditure within the DoD's budget, reflecting the critical role of ISR in modern warfare.

What is Teledyne FLIR's track record with government contracts, particularly sole-source awards?

Teledyne FLIR, and its predecessor FLIR Systems, has a long and extensive track record of supplying advanced sensor systems, including EO/IR technology, to various U.S. government agencies, including the Department of Defense. They are a well-established prime contractor in this domain. While they undoubtedly receive numerous competitive awards, it is not uncommon for specialized, high-technology systems like the STAR SAFIRE series to be procured via sole-source or limited-competition vehicles, especially when specific performance requirements or existing platform integrations are critical. Their history suggests a capacity to meet demanding government specifications, but the frequency and justification of their sole-source awards would require deeper analysis.

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: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 27700 SW PARKWAY AVE, WILSONVILLE, OR, 05

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: $47,994,957

Exercised Options: $47,994,957

Current Obligation: $47,994,957

Contract Characteristics

Cost or Pricing Data: NO

Timeline