DoD Awards L3Harris Technologies $107M for First Article Testing Amidst Firm Fixed Price Contract
Contract Overview
Contract Amount: $107,045,206 ($107.0M)
Contractor: L3harris Technologies, Inc.
Awarding Agency: Department of Defense
Start Date: 2022-03-25
End Date: 2027-03-24
Contract Duration: 1,825 days
Daily Burn Rate: $58.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: CNR - MINIMUM GUARANTEE FOR FIRST ARTICLE TESTING.
Place of Performance
Location: ROCHESTER, MONROE County, NEW YORK, 14610
State: New York Government Spending
Plain-Language Summary
Department of Defense obligated $107.0 million to L3HARRIS TECHNOLOGIES, INC. for work described as: CNR - MINIMUM GUARANTEE FOR FIRST ARTICLE TESTING. Key points: 1. Contract awarded to L3Harris Technologies, a major defense contractor. 2. The contract is for a minimum guarantee for first article testing, suggesting a need for initial validation of products. 3. The firm fixed price structure aims to control costs, but the 'minimum guarantee' aspect warrants scrutiny for potential overpayment if testing requirements are not fully utilized. 4. The sector is Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing, indicating a focus on advanced communication systems.
Value Assessment
Rating: fair
The contract is a firm fixed price delivery order with a minimum guarantee. While the fixed price aims for cost certainty, the guarantee could lead to paying for unused testing capacity if the minimum is not reached. Benchmarking against similar first article testing contracts is difficult without more specific scope details.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which is positive for price discovery. However, the nature of a 'minimum guarantee' for first article testing might limit the actual competitive pressure on the final price if the guaranteed amount is substantial and testing volumes are uncertain.
Taxpayer Impact: The firm fixed price aims to protect taxpayers, but the minimum guarantee could result in paying for services not fully rendered if the minimum threshold is not met by actual testing needs.
Public Impact
Ensures initial product quality and performance validation for critical defense communication systems. Supports the Department of the Army's readiness and technological advancement in wireless communications. Potential for follow-on production contracts based on successful first article testing results.
Waste & Efficiency Indicators
Waste Risk Score: 59 / 10
Warning Flags
- Minimum guarantee may lead to overpayment if testing needs are lower than guaranteed.
- Lack of specific details on the scope of 'first article testing'.
Positive Signals
- Awarded under full and open competition.
- Firm fixed price contract structure.
Sector Analysis
This contract falls within the Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing sector. Spending in this area is critical for modern defense capabilities, focusing on secure and advanced communication technologies. Benchmarks are difficult without specific technical requirements, but significant investment is typical for cutting-edge defense electronics.
Small Business Impact
The data does not indicate any specific provisions or set-asides for small businesses in this contract. As a large contract awarded to a major defense contractor, opportunities for small business subcontracting may exist but are not explicitly detailed here.
Oversight & Accountability
The contract is a delivery order under a larger agreement, suggesting existing oversight mechanisms. The firm fixed price and full and open competition are positive indicators of accountability. However, monitoring the utilization of the minimum guarantee is crucial for ensuring value for taxpayer money.
Related Government Programs
- Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Potential for overpayment due to minimum guarantee.
- Lack of detailed scope for first article testing.
- Uncertainty regarding the actual need for the guaranteed testing volume.
- Limited visibility into specific performance metrics for testing.
Tags
radio-and-television-broadcasting-and-wi, department-of-defense, ny, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $107.0 million to L3HARRIS TECHNOLOGIES, INC.. CNR - MINIMUM GUARANTEE FOR FIRST ARTICLE TESTING.
Who is the contractor on this award?
The obligated recipient is L3HARRIS TECHNOLOGIES, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $107.0 million.
What is the period of performance?
Start: 2022-03-25. End: 2027-03-24.
What is the specific scope and expected volume of 'first article testing' to justify the minimum guarantee amount?
The specific scope and expected volume of 'first article testing' are not detailed in the provided data. Understanding these specifics is crucial to assess whether the minimum guarantee of $107,045,206 is justified. Without this information, it's difficult to determine if the government is paying for potentially unused testing capacity or if it reflects a realistic estimate of necessary initial validation for complex wireless communication equipment.
How does the 'minimum guarantee' impact the effective price discovery achieved through full and open competition?
While the contract was awarded through full and open competition, the 'minimum guarantee' introduces a potential distortion to effective price discovery. If the guaranteed amount is significantly higher than the actual testing required, the government might end up paying a premium for services not fully utilized. This could reduce the overall cost-saving benefit typically associated with competitive bidding, especially if the guarantee sets a baseline cost regardless of actual need.
What are the key performance indicators (KPIs) for the 'first article testing' and how will their successful completion be measured?
The provided data does not specify the key performance indicators (KPIs) for the 'first article testing' or the methods for measuring their successful completion. Establishing clear, measurable KPIs is essential for ensuring the effectiveness of the testing process and verifying that the awarded funds are used to validate critical aspects of the wireless communication equipment. Without defined KPIs, assessing the true value and effectiveness of this contract is challenging.
Industry Classification
NAICS: Manufacturing › Communications Equipment Manufacturing › Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing
Product/Service Code: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: L3harris Technologies, Inc
Address: 1680 UNIVERSITY AVE, ROCHESTER, NY, 14610
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: $108,749,236
Exercised Options: $107,906,098
Current Obligation: $107,045,206
Subaward Activity
Number of Subawards: 1
Total Subaward Amount: $165,998
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W15P7T22D0001
IDV Type: IDC
Timeline
Start Date: 2022-03-25
Current End Date: 2027-03-24
Potential End Date: 2027-03-24 00:00:00
Last Modified: 2025-09-08
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