DoD's $145.7M MET-I Technical SE&I contract awarded to Boeing raises questions on competition and value
Contract Overview
Contract Amount: $145,734,251 ($145.7M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2015-12-02
End Date: 2018-12-20
Contract Duration: 1,114 days
Daily Burn Rate: $130.8K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS AWARD FEE
Sector: R&D
Official Description: IGF::OT::IGF CORE MET-I TECHNICAL SE&I REQUIREMENTS
Place of Performance
Location: HUNTSVILLE, MADISON County, ALABAMA, 35824
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $145.7 million to THE BOEING COMPANY for work described as: IGF::OT::IGF CORE MET-I TECHNICAL SE&I REQUIREMENTS Key points: 1. The contract's significant value of $145.7M for R&D services warrants scrutiny, especially given its sole-source nature. 2. Boeing, a major defense contractor, secured this award without competition, potentially limiting price discovery. 3. The 'Research and Development in the Physical, Engineering, and Life Sciences' sector is broad, and the specific deliverables need clear definition to assess value. 4. The 'COST PLUS AWARD FEE' contract type can incentivize performance but also carries inherent cost risks if not managed tightly.
Value Assessment
Rating: questionable
The $145.7M award for R&D services lacks clear benchmarks for comparison due to its unique nature and sole-source award. Without competitive bids, assessing if the pricing is optimal or inflated is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning no other vendors were considered. This significantly limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition for a contract of this magnitude means taxpayers may not be receiving the best possible price for these critical R&D services.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding for a substantial R&D contract. The Missile Defense Agency's reliance on a single contractor for critical technical SE&I requirements could pose a long-term strategic risk. The broad R&D category makes it challenging for the public to understand the specific technological advancements being funded.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Cost-plus contract type
- Broad R&D category
Positive Signals
- Awarded to a known, capable contractor (Boeing)
- Contract supports critical defense mission (Missile Defense Agency)
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 requires careful oversight to ensure taxpayer funds are used effectively and competitively.
Small Business Impact
The contract data indicates no specific set-aside for small businesses, and the award to a large prime contractor like Boeing suggests limited direct opportunities for SMBs on this particular contract.
Oversight & Accountability
The sole-source nature of this award necessitates robust oversight from the Department of Defense and the Missile Defense Agency to ensure cost control, performance, and adherence to contract terms. Transparency regarding the justification for the sole-source award is also crucial.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
- Department of Defense Contracting
- Missile Defense Agency Programs
Risk Flags
- Sole-source award limits competition and price discovery.
- Cost-plus contract type carries inherent risk of cost overruns.
- Lack of clear benchmarks makes value assessment difficult.
- Potential for contractor lock-in due to specialized R&D.
- Broad R&D category may obscure specific deliverables and value.
Tags
research-and-development-in-the-physical, department-of-defense, al, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $145.7 million to THE BOEING COMPANY. IGF::OT::IGF CORE MET-I TECHNICAL SE&I REQUIREMENTS
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Missile Defense Agency).
What is the total obligated amount?
The obligated amount is $145.7 million.
What is the period of performance?
Start: 2015-12-02. End: 2018-12-20.
What was the justification for awarding this significant R&D contract on a sole-source basis, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of market availability. For this $145.7M contract, the agency likely cited specific technical expertise or proprietary technology held by Boeing. However, without a competitive process, it's difficult to independently verify if these claims were thoroughly explored against potential alternatives or if a more competitive approach could have yielded better value.
How is the 'COST PLUS AWARD FEE' structure being managed to ensure cost efficiency and prevent potential overruns, given the $145.7M value?
The Cost Plus Award Fee (CPAF) structure incentivizes contractor performance by linking a portion of the fee to achieving specific performance objectives. Effective management requires clearly defined metrics, rigorous monitoring of costs and progress, and objective evaluation of performance against award criteria. The agency must ensure that the award fee criteria are challenging yet achievable and that the 'cost' component is closely scrutinized to prevent unnecessary expenditures.
What specific R&D outcomes or technological advancements are expected from this contract, and how will their success be measured?
Given the contract's focus on 'MET-I TECHNICAL SE&I REQUIREMENTS,' the expected outcomes likely relate to the technical support, engineering, and integration necessary for missile defense systems. Success measurement would involve predefined technical milestones, system performance improvements, successful integration testing, and timely delivery of technical documentation. The agency needs robust program management and technical expertise to validate these outcomes and ensure they align with the overall missile defense strategy.
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: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Address: 499 BOEING BLVD SW, HUNTSVILLE, AL, 35824
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: $147,222,098
Exercised Options: $147,222,098
Current Obligation: $145,734,251
Subaward Activity
Number of Subawards: 18
Total Subaward Amount: $6,407,820
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HQ014714D0001
IDV Type: IDC
Timeline
Start Date: 2015-12-02
Current End Date: 2018-12-20
Potential End Date: 2018-12-20 00:00:00
Last Modified: 2024-09-11
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