By Geoff Fein
The Navy’s decision to award several sole-source contracts to Lockheed Martin [LMT] for Aegis combat system work were unobjectionable given that the service determined that an award to Raytheon [RTN] would result in schedule delays, according to the Government Accountability Office (GAO).
The GAO’s published decision was made available Friday. The agency issued its decision denying Raytheon’s protests on Dec. 22 (Defense Daily, Dec. 27).
In September, the Navy issued justification and approval documents that concluded awarding sole-source contracts to Lockheed Martin for Aegis development associated with Aegis Modernization (AMOD) Advanced Capability Build 12, for procurement of 14 Multi-Mission Signal Processor sets, 13 Ballistic Missile Defense 4.0.1 sets, and multiple configurations of equipment upgrades as part of the AMOD, and for Aegis support services, were justified because award to a source other than Lockheed Martin would result in “substantial duplication of cost, which the government is not expected to be recovered through competition,” or “unacceptable delays” in fulfilling the Navy’s needs, according to the GAO.
In the case of the award for hardware procurement, the Navy estimated that using a source other than Lockheed Martin would result in a delay of two to three years in contract performance, GAO said.
Awarding any of the other Aegis efforts to another source could result in delays of up to 24 months, the Navy said.
The sole-source procurements are unobjectionable if the Navy reasonably found that award to any source other than [Lockheed Martin] would likely result in either substantial duplication of cost or unacceptable delays, GAO found.
“Because either basis is sufficent…we find that the Navy reasonably determined that acquisition from Raytheon [Integrated Defense Systems] (or any source other than Lockheed Martin Maritime Missiles and Sensors) would likely cause unacceptable delay, we will not address the question of duplication of costs,” GAO said.
The GAO added that the Navy’s determination that selection of a contractor that lacked specific Aegis-related experience with critical weapons capabilities could subject the Navy to delays in performance of the contracts was reasonable.
The redacted GAO protest decision clearly demonstrates that GAO was genuinely concerned over the Navy’s sole source Aegis upgrades, Jim McAleese of McAleese & Associates, told Defense Daily Friday.
“Otherwise, GAO would not have held an evidentiary hearing, only four weeks before the final Protest Decision was required to be publicly-released. The GAO’s protest decision demonstrates that GAO recognized the Navy’s concerns, over the limited schedule-availability of DDG-51 and CG-47 hulls during mid-life HM&E overhauls, and the need for seamless upgrades of new signal processors; beyond-the-horizon-fire-control; Ballistic Missile Defense capability; and integrated ‘SIAP’ air picture,” he said.
Importantly, GAO clearly relied upon its own credibility determinations during the testimony of Navy Program Executive Officer-Integrated Warfare Systems, presumably Rear Adm. Benedict, McAleese added.
“GAO’s decision shows at least four to five specific references to Navy PEO-IWS testimony during the late-November hearing, regarding Raytheon’s combat-systems-integration responsibilities under the DDG-1000 program; and the technical/schedule risk of de-laminating and re-integrating complex Aegis subsystems and legacy software during the concurrent development and production for ‘ACB-12’ by 2012,” he said.
Ultimately, the GAO implicitly recognized that the command-decision for the “Advanced Capability Build-12” Aegis upgrades was made by PEO-IWS himself, with contemporaneous knowledge of the capabilities of both Lockheed Martin and Raytheon, because PEO-IWS is responsible for combat-systems integration of both Aegis DDG-51 and CG-47 hulls, and also DDG-1000, McAleese said.
“However, it is clear from the last-minute hearing, that GAO will be monitoring Navy’s future ‘Open Architecture’ progress, to ‘componentize’ subsystems for future competition in high-dollar platforms.,” he added.