DoD's $27.7M R&D contract for screening obscuration systems awarded to L3 Technologies, Inc

Contract Overview

Contract Amount: $27,692,558 ($27.7M)

Contractor: L3 Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2016-08-31

End Date: 2025-10-31

Contract Duration: 3,348 days

Daily Burn Rate: $8.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS INCENTIVE FEE

Sector: R&D

Official Description: IGF::OT::IGF EXECUTION OF SCREENING OBSCURATION MODULE (SOM) SYSTEM INTEGRATION AND DEMONSTRATION (SID) PHASE AND PRODUCTION OPTIONS.

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92121

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $27.7 million to L3 TECHNOLOGIES, INC. for work described as: IGF::OT::IGF EXECUTION OF SCREENING OBSCURATION MODULE (SOM) SYSTEM INTEGRATION AND DEMONSTRATION (SID) PHASE AND PRODUCTION OPTIONS. Key points: 1. Contract awarded via full and open competition, suggesting a competitive market for this technology. 2. Research and Development focus indicates investment in future capabilities rather than immediate operational deployment. 3. Cost Plus Incentive Fee (CPIF) contract type allows for shared cost savings and performance incentives. 4. Long duration (3348 days) suggests a complex, multi-phase project with potential for evolving requirements. 5. Awarded to a single contractor, L3 Technologies, Inc., highlighting their specialized capabilities in this niche. 6. The contract's value is moderate within the context of large-scale defense R&D programs.

Value Assessment

Rating: fair

Benchmarking the value of this R&D contract is challenging without specific performance metrics or comparable projects. The CPIF structure aims to control costs, but the final expenditure will depend on contractor performance and achieved milestones. The total obligated amount of $27.7 million over its lifespan appears reasonable for a multi-year R&D effort in a specialized defense area, but a detailed cost breakdown and comparison to similar system development efforts would be needed for a more definitive assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors were likely solicited and had the opportunity to bid. This approach generally fosters price discovery and encourages competitive pricing. The fact that L3 Technologies, Inc. was ultimately awarded the contract suggests they offered the best value proposition among the competing entities, whether based on technical merit, price, or a combination thereof.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it increases the likelihood of obtaining goods and services at competitive prices, maximizing the value of federal dollars spent.

Public Impact

The primary beneficiaries are the Department of Defense, specifically the Department of the Army, which will receive advanced screening obscuration capabilities. The contract supports the development and demonstration of a Screening Obscuration Module (SOM) system, enhancing military operational effectiveness. The geographic impact is primarily within California, where the contractor is located, potentially creating or sustaining high-tech jobs. Workforce implications include specialized engineering, research, and technical roles required for advanced systems development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in CPIF contracts if performance targets are not met efficiently.
Long contract duration increases risk of scope creep or obsolescence of technology by completion.
Reliance on a single contractor for a critical R&D effort could pose supply chain risks if not managed proactively.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
CPIF contract structure incentivizes contractor efficiency and performance.
Focus on R&D suggests investment in future technological superiority for national defense.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical and engineering sciences. The market for advanced defense systems, including obscuration technologies, is highly specialized and often dominated by a few key players. Spending in this area is driven by evolving military requirements and the need for technological superiority. Comparable spending benchmarks would typically be found within other large-scale DoD R&D programs for advanced sensor, countermeasure, or stealth technologies.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large definitive contract awarded to L3 Technologies, Inc., it is unlikely that significant subcontracting opportunities for small businesses will be mandated unless specified within the contract's performance requirements. The primary focus is on the prime contractor's capabilities, with potential downstream impacts on the small business ecosystem being indirect.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program management office within the Department of the Army. The CPIF structure includes specific performance metrics and cost reporting requirements that facilitate oversight. Transparency is generally maintained through contract award databases and reporting requirements, though detailed technical specifications and cost breakdowns may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Research and Development Programs
Advanced Materials and Systems Development
Military Obscuration and Countermeasure Technologies
Army Future Command Initiatives

Risk Flags

Long contract duration increases risk of scope creep and potential cost overruns.
CPIF contract type requires careful monitoring of cost and performance metrics.
Reliance on a single contractor for R&D and potential production could pose supply chain risks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.7 million to L3 TECHNOLOGIES, INC.. IGF::OT::IGF EXECUTION OF SCREENING OBSCURATION MODULE (SOM) SYSTEM INTEGRATION AND DEMONSTRATION (SID) PHASE AND PRODUCTION OPTIONS.

Who is the contractor on this award?

The obligated recipient is L3 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 $27.7 million.

What is the period of performance?

Start: 2016-08-31. End: 2025-10-31.

What is the historical spending pattern for Screening Obscuration Module (SOM) systems by the Department of Defense?

Historical spending data specifically for 'Screening Obscuration Module (SOM) systems' is not readily available in public databases. However, the Department of Defense consistently invests significant funds in Research and Development (R&D) for advanced technologies, including those related to electronic warfare, countermeasures, and signature management. The NAICS code 541712 (Research and Development in the Physical, Engineering, and Life Sciences) indicates a broad category where such specialized R&D falls. The total contract value of $27.7 million for this specific SOM system development and demonstration phase suggests a focused investment rather than a widespread, long-term procurement of a mature system. Broader R&D spending within the DoD often runs into billions of dollars annually across various scientific and engineering disciplines, with specific program allocations fluctuating based on strategic priorities and technological advancements.

How does the Cost Plus Incentive Fee (CPIF) structure impact the final cost and contractor performance for this contract?

The Cost Plus Incentive Fee (CPIF) contract type is designed to incentivize the contractor to control costs while meeting performance targets. In a CPIF arrangement, the final fee (profit) paid to the contractor is adjusted based on the relationship between the final incurred costs and the target costs. If the contractor performs more efficiently than targeted (i.e., incurs lower costs), both the government and the contractor share in the savings, with the contractor receiving a higher fee. Conversely, if costs exceed the target, the contractor's fee is reduced, and in some cases, the government and contractor may share in the overruns. This structure encourages L3 Technologies, Inc. to not only complete the Screening Obscuration Module (SOM) system development but also to do so in a cost-effective manner, aligning their financial interests with those of the government. The effectiveness of this structure depends heavily on the realism of the target costs and the clarity and measurability of the performance incentives.

What are the specific performance metrics or milestones tied to the incentive fee for L3 Technologies, Inc.?

The specific performance metrics and milestones tied to the incentive fee for L3 Technologies, Inc. under this contract are not publicly detailed in the provided data. Typically, for a CPIF contract in R&D, these metrics would relate to achieving specific technical performance levels (e.g., effectiveness of obscuration, range, power consumption), completing development phases within certain timeframes, demonstrating system reliability, or successfully integrating the module with existing platforms. The incentive fee structure would outline the target cost, target fee, minimum/maximum fee, and the sharing ratio for cost variances. Without access to the contract's Statement of Work (SOW) and the detailed incentive clauses, the precise nature of these performance drivers remains proprietary. However, the success of the SOM system's demonstration phase and its eventual production options would likely be key factors.

What is the track record of L3 Technologies, Inc. in delivering similar R&D or defense systems contracts?

L3 Technologies, Inc. (now part of L3Harris Technologies) has a substantial track record in delivering a wide array of defense and aerospace systems, including advanced technologies, electronic warfare, communications, and sensor systems. They have historically been a significant contractor for the Department of Defense and other government agencies. Their experience spans research and development, system integration, manufacturing, and sustainment. While specific details on past contracts for 'screening obscuration' technologies are not provided here, the company's overall profile suggests they possess the technical expertise and program management capabilities necessary for complex R&D efforts like the SOM system. Their history includes numerous large-value contracts, indicating experience in managing complex projects and navigating government procurement processes.

How does the $27.7 million contract value compare to the overall R&D spending within the Department of the Army or DoD?

The $27.7 million contract value for the Screening Obscuration Module (SOM) system integration and demonstration is a relatively modest figure when compared to the total Research and Development (R&D) budgets of the Department of the Army or the Department of Defense (DoD) as a whole. For instance, the DoD's R&D budget typically runs into the tens of billions of dollars annually. The Department of the Army's portion of this is also in the billions. This specific contract represents a focused investment in a particular technology area. While significant for the development of the SOM system itself, it constitutes a small fraction of the overall defense R&D portfolio. This scale is typical for specialized technology development programs that are in the demonstration or early production phases, rather than large-scale procurement programs.

What are the potential risks associated with the 'Production Options' mentioned in the contract description?

The mention of 'Production Options' in the contract description for the IGF::OT::IGF EXECUTION OF SCREENING OBSCURATION MODULE (SOM) SYSTEM INTEGRATION AND DEMONSTRATION (SID) PHASE AND PRODUCTION OPTIONS indicates a potential for future procurement of the developed system. The primary risks associated with these options include: 1) Cost uncertainty: The cost of production may differ significantly from estimates made during the R&D phase, potentially leading to higher unit prices if not adequately negotiated or benchmarked. 2) Performance validation: The system's effectiveness and reliability in a production environment need to be fully validated beyond the demonstration phase. 3) Scalability: Scaling up production to meet potential demand could present manufacturing and logistical challenges for the contractor. 4) Competition for future phases: If the options are exercised without further competition, it could limit future opportunities for other vendors and potentially reduce price pressure. 5) Technological obsolescence: The technology might become outdated before large-scale production even begins, depending on the pace of innovation in the field.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)

Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W911SR16R0002

Offers Received: 1

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 9890 TOWNE CENTRE DR STE 100, SAN DIEGO, CA, 92121

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $27,724,231

Exercised Options: $27,724,231

Current Obligation: $27,692,558

Actual Outlays: $-61,221

Subaward Activity

Number of Subawards: 19

Total Subaward Amount: $2,453,925

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NOT OBTAINED - WAIVED

Timeline