DoD awards Boeing $16.6M for R&D, raising questions on value and competition effectiveness
Contract Overview
Contract Amount: $16,607,354 ($16.6M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2008-02-04
End Date: 2012-12-31
Contract Duration: 1,792 days
Daily Burn Rate: $9.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: LASIR TO 0001
Place of Performance
Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87109
Plain-Language Summary
Department of Defense obligated $16.6 million to THE BOEING COMPANY for work described as: LASIR TO 0001 Key points: 1. The contract value is moderate, but the specific R&D focus requires deeper analysis for true value. 2. Boeing is a major defense contractor, indicating potential for strong technical execution but also limited competition. 3. The Cost Plus Fixed Fee structure can lead to cost overruns if not managed tightly. 4. This falls under R&D in Physical, Engineering, and Life Sciences, a critical but complex sector.
Value Assessment
Rating: fair
The $16.6M award for R&D is difficult to benchmark without knowing the specific research outcomes. The Cost Plus Fixed Fee structure introduces risk if not closely monitored for efficiency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
While advertised as full and open, the specific nature of advanced R&D may inherently limit the number of capable bidders. The price discovery mechanism relies on the fixed fee, which may not fully incentivize cost efficiency.
Taxpayer Impact: Taxpayer funds are supporting advanced research, with the ultimate benefit dependent on the success and applicability of the R&D outcomes.
Public Impact
Investment in advanced research and development by the Department of Defense. Potential for technological advancements with implications for national security. Contract awarded to a major aerospace and defense corporation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee structure can incentivize higher spending.
- R&D contracts are inherently difficult to scope and manage effectively.
- Limited visibility into the specific R&D objectives and success metrics.
Positive Signals
- Awarded to a reputable and experienced contractor.
- Supports critical research and development for national security.
Sector Analysis
This contract falls under Research and Development in the Physical, Engineering, and Life Sciences. Spending in this sector is crucial for innovation but often involves high risk and long development cycles, making cost and outcome assessment challenging.
Small Business Impact
The contract was awarded to The Boeing Company, a large prime contractor. There is no indication of small business participation in this specific award, suggesting limited opportunities for smaller entities.
Oversight & Accountability
The Department of Defense, through its agencies like the Defense Contract Management Agency, is responsible for overseeing this contract. Robust oversight is crucial for Cost Plus Fixed Fee R&D to ensure efficient use of funds and achievement of objectives.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Cost Plus Fixed Fee structure.
- R&D contracts are inherently high-risk.
- Potential for limited effective competition despite 'full and open' status.
- Lack of specific R&D outcome metrics for value assessment.
Tags
research-and-development-in-the-physical, department-of-defense, nm, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $16.6 million to THE BOEING COMPANY. LASIR TO 0001
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $16.6 million.
What is the period of performance?
Start: 2008-02-04. End: 2012-12-31.
What specific R&D objectives were prioritized in this contract, and how will their achievement be measured to determine value for money?
The contract's value is contingent on the successful completion of specific research and development milestones. Measuring value requires clear, quantifiable objectives tied to technological advancement or problem-solving. Without detailed project scope and success metrics, assessing the $16.6M investment's true worth is speculative. The Cost Plus Fixed Fee structure necessitates rigorous monitoring to ensure efficient resource allocation towards these defined R&D goals.
Given the full and open competition designation, what steps were taken to ensure a broad range of bidders could realistically compete for this specialized R&D work?
While designated full and open, specialized R&D often presents barriers to entry for smaller or less experienced firms. The government likely issued detailed solicitations outlining technical requirements and evaluation criteria. However, the complexity and specific expertise needed for this R&D may have naturally favored established players like Boeing, potentially limiting the breadth of actual competition despite the designation.
How does the Cost Plus Fixed Fee structure balance the need for R&D exploration with taxpayer protection against cost overruns?
The Cost Plus Fixed Fee structure aims to provide the contractor with cost reimbursement plus a predetermined fixed fee. This can encourage innovation by reducing the contractor's financial risk. However, it requires stringent oversight to prevent scope creep and ensure efficient spending, as the incentive to control costs is primarily driven by the fixed fee rather than direct cost savings. This necessitates robust government monitoring of expenditures and progress.
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 › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 6200 UPTOWN BLVD, STE 240, ALBUQUERQUE, NM, 87110
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $17,857,452
Exercised Options: $17,857,452
Current Obligation: $16,607,354
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA945108D0179
IDV Type: IDC
Timeline
Start Date: 2008-02-04
Current End Date: 2012-12-31
Potential End Date: 2012-12-31 00:00:00
Last Modified: 2017-06-21
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