DoD's $626.6M contract for antennas and communication equipment awarded to Federal Prison Industries raises value and competition concerns
Contract Overview
Contract Amount: $172,299,741 ($172.3M)
Contractor: Federal Prison Industries, Inc
Awarding Agency: Department of Defense
Start Date: 2005-06-29
End Date: 2007-02-28
Contract Duration: 609 days
Daily Burn Rate: $282.9K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 200509!005033!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !W15P7T05F0073 !A!N! !N! ! !20050629!20070228!624770475!626627459!626627459!Y!UNICOR, FEDERAL PRISON INDUSTR!320 1ST STREET, N W !WASHINGTON !DC!20534!50000!001!11!WASHINGTON !DISTRICT OF COLUMBIA !D.C. !+000097357327!N!N!000000000000!5985!ANTENNAS, WAVEGUIDES & RELATED EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !334290!E! !8! ! ! ! ! !20200930!B! ! ! ! ! ! ! ! !000! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !000! ! ! ! ! ! ! ! ! !0001! !
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20534
Plain-Language Summary
Department of Defense obligated $172.3 million to FEDERAL PRISON INDUSTRIES, INC for work described as: 200509!005033!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !W15P7T05F0073 !A!N! !N! ! !20050629!20070228!624770475!626627459!626627459!Y!UNICOR, FEDERAL PRISON INDUSTR!320 1ST STREET, N W !WASHINGTON !DC!20534!50000!001!11!WASHINGTON !DIST… Key points: 1. The contract's value appears high relative to the duration and scope, suggesting potential overpayment. 2. Awarding to a sole-source entity limits market price discovery and competitive pressure. 3. The lack of competition is a significant risk indicator for taxpayer value. 4. Performance context is limited due to the sole-source nature and lack of comparative data. 5. This contract falls within the broader 'Electronics and Communication Equipment' sector. 6. The contract's duration of over 600 days without competitive bidding warrants scrutiny.
Value Assessment
Rating: questionable
The total award amount of $626.6 million over approximately 20 months for antennas and related equipment appears substantial. Without comparable contracts or detailed cost breakdowns, it is difficult to definitively assess value for money. However, the sole-source nature of the award to Federal Prison Industries (UNICOR) suggests a lack of competitive benchmarking, which typically drives down prices. This raises questions about whether the government secured the best possible pricing and value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis to Federal Prison Industries, Inc. (UNICOR). This means there was no formal competition held to solicit bids from multiple vendors. While UNICOR has a mandate to employ federal prisoners, awarding contracts without competition bypasses the standard procurement processes designed to ensure fair pricing and optimal selection of contractors. The lack of bidders means there was no opportunity for market forces to influence the price or terms.
Taxpayer Impact: Awarding contracts without competition to a single entity like UNICOR can lead to higher costs for taxpayers compared to what might be achieved through a competitive bidding process. This limits the government's ability to leverage market dynamics for cost savings.
Public Impact
The primary beneficiary of this contract is Federal Prison Industries (UNICOR), fulfilling its mission to provide employment for federal inmates. The contract delivers antennas, waveguides, and related electronic communication equipment, likely for use by the Department of Defense. The geographic impact is national, as the equipment is procured for federal defense purposes. Workforce implications are primarily within the federal prison system, providing vocational training and employment opportunities for inmates.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competitive bidding may result in inflated costs for taxpayers.
- Sole-source award limits transparency and accountability in pricing.
- Potential for less innovation or quality compared to a competitive market.
- Contract duration without competition raises concerns about ongoing value.
Positive Signals
- Fulfills the statutory mission of Federal Prison Industries to employ federal inmates.
- Provides essential communication equipment for defense purposes.
- Ensures a consistent supply chain for specific defense needs through a mandated source.
Sector Analysis
This contract falls under the broader category of 'Electronics and Communication Equipment Manufacturing.' The market for such equipment is vast and highly competitive, with numerous private sector firms specializing in advanced antenna and communication technologies. The total federal spending in this sector is significant, encompassing a wide range of defense and civilian agency needs. Awarding such a substantial contract on a sole-source basis to a non-traditional supplier like UNICOR deviates from typical market engagement strategies.
Small Business Impact
As this contract was awarded on a sole-source basis to Federal Prison Industries, there were no small business set-aside provisions or subcontracting opportunities directly tied to this award. Federal Prison Industries operates under a different statutory framework than typical government contractors, and its primary mission is inmate employment rather than fostering the small business ecosystem. Therefore, this contract does not contribute to small business goals.
Oversight & Accountability
Oversight for contracts involving Federal Prison Industries (UNICOR) is primarily internal to the Bureau of Prisons and the Department of Justice, with oversight also provided by the Department of Defense as the procuring agency. Transparency is generally limited due to the sole-source nature. Accountability for performance and cost would typically be managed through contract administration by the Defense Contract Management Agency (DCMA), but the lack of competitive comparison makes robust value assessment challenging.
Related Government Programs
- Federal Prison Industries (UNICOR) Contracts
- Department of Defense Electronics Procurement
- Antenna and Waveguide Manufacturing
- Sole-Source Defense Contracts
- Communication Equipment for National Security
Risk Flags
- Sole-source award bypasses competition
- Potential for inflated pricing due to lack of market pressure
- Limited transparency in cost justification
- Uncertainty regarding technological advancement compared to competitive market
Tags
defense, department-of-defense, sole-source, firm-fixed-price, large-contract, electronics, communication-equipment, antennas, unicor, federal-prison-industries, district-of-columbia, washington-dc
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $172.3 million to FEDERAL PRISON INDUSTRIES, INC. 200509!005033!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !W15P7T05F0073 !A!N! !N! ! !20050629!20070228!624770475!626627459!626627459!Y!UNICOR, FEDERAL PRISON INDUSTR!320 1ST STREET, N W !WASHINGTON !DC!20534!50000!001!11!WASHINGTON !DISTRICT OF COLUMBIA !D.C. !+000097357327!N!N!000000000000!5985!ANTENNAS, WAVEGUIDES & RELATED EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !334290!E! !8! ! ! ! ! !202
Who is the contractor on this award?
The obligated recipient is FEDERAL PRISON INDUSTRIES, 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 $172.3 million.
What is the period of performance?
Start: 2005-06-29. End: 2007-02-28.
What is the track record of Federal Prison Industries (UNICOR) in delivering complex electronic equipment like antennas and waveguides to the Department of Defense?
Federal Prison Industries (UNICOR) primarily focuses on providing vocational training and employment for federal inmates across a range of industries, including manufacturing and services. While they produce various goods, their track record specifically in delivering high-specification, complex electronic equipment such as advanced antennas and waveguides for demanding defense applications is less documented in the public domain compared to specialized defense contractors. The nature of their mandate often prioritizes inmate labor and production volume over cutting-edge technological development or specialized engineering required for certain defense electronics. Performance data on the reliability, technical compliance, and long-term effectiveness of such equipment supplied by UNICOR would be crucial for a comprehensive assessment.
How does the pricing of this $626.6 million contract compare to similar antenna and communication equipment procured competitively by the DoD?
Direct price comparison is challenging due to the sole-source nature of this award to Federal Prison Industries (UNICOR). Competitive procurements typically involve multiple bids, allowing for price discovery and negotiation based on market rates. Without access to the specific technical specifications, quantities, and unit costs within this contract, and lacking comparable competitive bids for identical or similar items, it's impossible to definitively state if the pricing is higher or lower than market. However, the absence of competition inherently removes a key mechanism for ensuring cost-effectiveness, suggesting a potential risk of paying a premium compared to what a competitive process might yield.
What are the primary risks associated with awarding a large contract like this on a sole-source basis to Federal Prison Industries?
The primary risks associated with this sole-source award include: 1. **Cost:** Potential for paying above fair market value due to the lack of competitive pressure. 2. **Innovation & Technology:** Risk of receiving equipment that may not incorporate the latest technological advancements or best-in-class solutions available in the open market. 3. **Performance & Quality:** While UNICOR aims for quality, the absence of direct market competition might reduce incentives for continuous improvement or rapid adaptation to evolving technical requirements. 4. **Transparency:** Sole-source awards inherently offer less transparency into the pricing structure and justification compared to competitive bids. 5. **Opportunity Cost:** Funds used for this sole-source contract could potentially have been used more effectively if secured through a competitive process that drives down costs.
What is the historical spending pattern for antennas, waveguides, and related equipment by the Department of Defense, and how does this contract fit in?
The Department of Defense historically spends billions of dollars annually on a wide array of electronic and communication equipment, including antennas and waveguides, often through competitive contracts with specialized defense industry firms. Spending patterns vary significantly based on technological upgrades, geopolitical needs, and specific platform requirements (e.g., aircraft, ships, ground systems). This $626.6 million contract, awarded over roughly 20 months, represents a significant, albeit singular, expenditure within this category. Its sole-source nature makes it an outlier compared to the typical competitive procurement strategies employed for such critical defense systems, suggesting it may fulfill a specific, perhaps long-standing, requirement or policy objective related to UNICOR's mandate.
What are the implications of this contract for the broader defense electronics market and potential competitors?
This sole-source award to Federal Prison Industries (UNICOR) has several implications for the broader defense electronics market. Firstly, it removes a significant contract opportunity from the competitive landscape, meaning established defense contractors specializing in antennas and communication equipment did not have a chance to bid. This can impact their revenue streams and potentially their investment in research and development for defense applications. Secondly, it highlights a specific policy avenue (using UNICOR) that the government can utilize, potentially signaling to other agencies that such sole-source arrangements are viable for certain types of goods. This could lead to less predictable market dynamics if such awards become more common, as it bypasses standard competitive processes that foster innovation and price efficiency among private sector firms.
Industry Classification
NAICS: Manufacturing › Communications Equipment Manufacturing › Other Communications Equipment Manufacturing
Product/Service Code: ELECTRICAL/ELECTRONIC EQPT COMPNTS
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Government of the United States (UEI: 161906193)
Address: 320 1ST STREET, N W, WASHINGTON, DC, 98
Business Categories: Category Business, Government, U.S. National Government, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Timeline
Start Date: 2005-06-29
Current End Date: 2007-02-28
Potential End Date: 2007-02-28 00:00:00
Last Modified: 2012-11-05
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