DoD's $41.7M Engineering Services Contract Awarded to AI Signal Research Inc. Shows Fair Value

Contract Overview

Contract Amount: $41,667,707 ($41.7M)

Contractor: AI Signal Research Inc

Awarding Agency: Department of Defense

Start Date: 2011-12-07

End Date: 2014-12-31

Contract Duration: 1,120 days

Daily Burn Rate: $37.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: TIME AND MATERIALS

Sector: Defense

Official Description: PROFESSIONAL SERVICES

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35898

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $41.7 million to AI SIGNAL RESEARCH INC for work described as: PROFESSIONAL SERVICES Key points: 1. Contract demonstrates a reasonable value for engineering services, aligning with market benchmarks. 2. Full and open competition suggests a healthy market dynamic for these services. 3. The contract's duration and type indicate a need for ongoing, flexible support. 4. Performance context is within the Department of the Army's broader engineering needs. 5. This contract positions AI Signal Research Inc. as a key provider in the defense engineering sector. 6. The use of Time and Materials pricing offers flexibility but requires careful monitoring.

Value Assessment

Rating: good

The contract's total value of $41.7 million over approximately three years appears reasonable when benchmarked against similar engineering service contracts awarded by the Department of Defense. The pricing structure, while Time and Materials, was subject to competition, which typically drives fair market pricing. Without specific line-item details, a precise per-unit cost comparison is difficult, but the overall award value suggests a good return for the services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The presence of 7 bidders suggests a competitive environment, which generally benefits the government by fostering price discovery and encouraging vendors to offer their best terms. This level of competition is a positive sign for achieving value for taxpayer money.

Taxpayer Impact: A competitive bidding process for this contract helps ensure that taxpayer funds are used efficiently by driving down costs and encouraging innovation among service providers.

Public Impact

The Department of the Army benefits from specialized engineering expertise to support its missions. Services delivered likely include design, analysis, and technical support for various defense projects. The geographic impact is primarily within Alabama, where AI Signal Research Inc. is located, but the services support national defense objectives. The contract supports a workforce of engineers and technical specialists within AI Signal Research Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials (T&M) contract type can lead to cost overruns if not closely managed.
The duration of the contract (over 3 years) necessitates ongoing vigilance regarding performance and cost.

Positive Signals

Awarded under full and open competition, indicating a robust bidding process.
Multiple bidders (7) suggest a competitive market and potential for good value.
The contractor, AI Signal Research Inc., is established in the engineering services sector.

Sector Analysis

The engineering services sector within the federal government is substantial, supporting a wide array of defense, infrastructure, and research initiatives. This $41.7 million contract for engineering services falls within the broader professional services category, which is a significant portion of federal procurement. Comparable spending benchmarks for engineering services vary widely based on specialization, but this award appears to be a mid-sized contract within the defense engineering domain.

Small Business Impact

This contract was awarded under full and open competition and does not indicate any specific small business set-aside. While AI Signal Research Inc. may be a small business itself, the award mechanism did not prioritize small businesses. There is no explicit information on subcontracting plans for small businesses within the provided data.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the administrative contracting officer within the Department of the Army. Performance monitoring, invoice review, and compliance checks are standard oversight mechanisms. Transparency is facilitated through contract databases like FPDS, and any significant issues could fall under the jurisdiction of the DoD Inspector General.

Related Government Programs

Department of Defense Engineering Services
Professional, Scientific, and Technical Services
Army Research, Development and Engineering Command Contracts
Time and Materials Contracts

Risk Flags

Time and Materials contract type requires close monitoring to prevent cost overruns.
Scope definition and management are critical for T&M contracts to ensure value.
Contract duration necessitates ongoing performance evaluation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $41.7 million to AI SIGNAL RESEARCH INC. PROFESSIONAL SERVICES

Who is the contractor on this award?

The obligated recipient is AI SIGNAL RESEARCH 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 $41.7 million.

What is the period of performance?

Start: 2011-12-07. End: 2014-12-31.

What is the track record of AI Signal Research Inc. with the Department of Defense?

AI Signal Research Inc. has a history of receiving contracts from the Department of Defense, primarily for engineering and technical services. This specific contract, valued at approximately $41.7 million, represents a significant award. Analyzing their broader contract portfolio within DoD would reveal the types of services they consistently provide, their performance history on past contracts (if publicly available through sources like the Contractor Performance Assessment Reporting System - CPARS), and their ability to meet the technical and schedule requirements of complex defense projects. Their sustained engagement suggests a level of capability and reliability valued by the Army.

How does the $41.7 million value compare to similar engineering service contracts?

The $41.7 million value for this three-year engineering services contract awarded to AI Signal Research Inc. appears to be within a reasonable range for specialized defense engineering support. Benchmarking requires comparing it to contracts with similar scopes of work, duration, and complexity within the Department of Defense or other federal agencies. For instance, contracts for systems engineering, technical assistance, or specialized design services can range from a few million to tens or even hundreds of millions of dollars. Given the 'Engineering Services' NAICS code (541330), this award suggests a substantial, but not exceptionally large, engagement, likely reflecting a specific project or ongoing support need rather than a massive, multi-billion dollar program.

What are the primary risks associated with this Time and Materials contract?

The primary risk associated with this Time and Materials (T&M) contract is the potential for cost overruns. Unlike fixed-price contracts, T&M agreements pay the contractor for the actual time and materials used. If not managed diligently, this can lead to costs exceeding initial estimates, especially if the scope of work is not well-defined or if inefficiencies arise. Key risks include scope creep, where the project expands beyond its original intent without a corresponding increase in the contract ceiling, and contractor inefficiency, where labor hours or material costs are higher than necessary. Robust oversight, detailed tracking of labor hours, and clear definition of work requirements are crucial to mitigate these risks.

How effective is full and open competition in ensuring value for this type of engineering service?

Full and open competition is generally considered a highly effective mechanism for ensuring value in the procurement of engineering services. By allowing all responsible sources to submit bids, it fosters a competitive environment where multiple companies vie for the contract. This competition drives down prices, encourages innovation in service delivery, and allows the government to select the offer that provides the best overall value, considering factors beyond just price, such as technical approach and past performance. The fact that seven bidders participated in this procurement indicates a healthy level of competition, increasing the likelihood that the Department of the Army secured quality engineering services at a fair and reasonable price.

What is the historical spending trend for engineering services by the Department of the Army?

The Department of the Army consistently spends billions of dollars annually on engineering services, reflecting its vast operational and developmental needs. This spending spans a wide range of requirements, from research and development support to infrastructure design and maintenance, and specialized technical assistance for weapon systems. Historical data indicates a steady demand for these services, often procured through various contract types including full-and-open competition, sole-source awards, and task orders against indefinite-delivery/indefinite-quantity (IDIQ) vehicles. The $41.7 million awarded to AI Signal Research Inc. represents a portion of this larger, ongoing investment in engineering expertise necessary to maintain military readiness and technological superiority.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 7

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 3411 TRIANA BLVD SW, HUNTSVILLE, AL, 35805

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $41,667,707

Exercised Options: $41,667,707

Current Obligation: $41,667,707

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W31P4Q10A0027

IDV Type: BPA

Timeline