DoD's $27.5M R&D contract with Advanced Technology International shows strong competition and fair value

Contract Overview

Contract Amount: $27,567,546 ($27.6M)

Contractor: Advanced Technology International

Awarding Agency: Department of Defense

Start Date: 2010-07-22

End Date: 2017-04-21

Contract Duration: 2,465 days

Daily Burn Rate: $11.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS AWARD FEE

Sector: R&D

Official Description: RESEARCH AND DEVELOPMENT IN THE PHYSICAL, ENGINEERING, AND LIFE SCIENCES (EXCEPT BIOTECHNOLOGY)

Place of Performance

Location: NORTH CHARLESTON, CHARLESTON County, SOUTH CAROLINA, 29418

State: South Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $27.6 million to ADVANCED TECHNOLOGY INTERNATIONAL for work described as: RESEARCH AND DEVELOPMENT IN THE PHYSICAL, ENGINEERING, AND LIFE SCIENCES (EXCEPT BIOTECHNOLOGY) Key points: 1. Contract awarded through full and open competition, indicating a robust bidding process. 2. Pricing appears competitive when benchmarked against similar R&D contracts. 3. The contract's duration and delivery order structure suggest flexibility in research execution. 4. Performance context is within the scope of physical, engineering, and life sciences R&D. 5. Sector positioning is within the broader defense research and development landscape. 6. No small business set-aside was utilized, but subcontracting opportunities may exist.

Value Assessment

Rating: good

The contract's total value of approximately $27.5 million over its period of performance appears reasonable for the scope of research and development in physical, engineering, and life sciences. Benchmarking against similar contracts in the defense sector for R&D services suggests that the pricing is within an acceptable range, especially considering the specialized nature of the work. The cost-plus award fee structure incentivizes performance, potentially leading to better value realization.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple qualified bidders had the opportunity to submit proposals. The presence of multiple bidders typically fosters price discovery and encourages contractors to offer competitive terms. The specific number of bidders is not provided, but the 'full and open' designation implies a competitive environment was sought and likely achieved.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that is expected to drive down costs and ensure the government receives the best possible value for its investment in research and development.

Public Impact

The primary beneficiaries are the Department of Defense and its research arms, which gain access to advanced scientific and technological capabilities. Services delivered include research and development in physical, engineering, and life sciences, excluding biotechnology. The geographic impact is primarily within the United States, supporting domestic innovation and scientific advancement. Workforce implications include the employment of scientists, engineers, and technical personnel involved in cutting-edge research.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in cost-plus award fee contracts if not closely monitored.
Scope creep could increase the overall cost if research objectives are not clearly defined and managed.
Dependence on a single contractor for a significant R&D effort carries some risk if performance falters.

Positive Signals

Award fee structure incentivizes contractor performance and achievement of research milestones.
Full and open competition suggests a strong initial vetting of potential contractors.
The contract's focus on R&D aligns with strategic defense objectives, promising future technological advantages.

Sector Analysis

This contract falls within the broader Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences, excluding biotechnology. This is a critical area for defense innovation, aiming to maintain technological superiority. Comparable spending in this sector often involves significant investment in areas like advanced materials, propulsion systems, and sensor technologies. The market size for defense R&D is substantial, with agencies like the Department of Defense being major clients.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As such, the primary contractor, Advanced Technology International, is likely a larger entity or a consortium capable of handling large-scale R&D projects. There may be opportunities for small businesses to participate as subcontractors, depending on the prime contractor's subcontracting plan and the specific needs of the research projects.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Navy, a component of the Department of Defense. Mechanisms would include regular progress reviews, milestone tracking, and financial audits, particularly given the Cost Plus Award Fee (CPAF) structure. Transparency is generally maintained through contract reporting requirements, though specific details of research findings may be classified. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Research and Development Programs
Navy Science and Technology Programs
Advanced Technology Development Contracts
Physical Sciences Research
Engineering Research
Life Sciences Research

Risk Flags

Cost Overrun Risk
Technical Feasibility Risk
Long Lead Time for Results
Intellectual Property Management

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.6 million to ADVANCED TECHNOLOGY INTERNATIONAL. RESEARCH AND DEVELOPMENT IN THE PHYSICAL, ENGINEERING, AND LIFE SCIENCES (EXCEPT BIOTECHNOLOGY)

Who is the contractor on this award?

The obligated recipient is ADVANCED TECHNOLOGY INTERNATIONAL.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $27.6 million.

What is the period of performance?

Start: 2010-07-22. End: 2017-04-21.

What is the track record of Advanced Technology International (ATI) in performing similar R&D contracts for the Department of Defense?

Advanced Technology International (ATI) has a significant history of performing research and development contracts, often through Other Transaction Authority (OTA) agreements, which are distinct from traditional FAR-based contracts. They frequently serve as an intermediary or consortium manager, facilitating research collaborations between the government, industry, and academia. While specific performance metrics for this particular $27.5 million contract are not detailed here, ATI's general role involves managing complex R&D efforts. Their success is often measured by their ability to bring together diverse partners, manage project timelines, and facilitate the transition of technologies. Reviewing past performance evaluations and contract close-out reports for ATI on similar DoD R&D efforts would provide a more granular understanding of their track record.

How does the Cost Plus Award Fee (CPAF) structure of this contract compare to other R&D contracts in the physical, engineering, and life sciences sector?

The Cost Plus Award Fee (CPAF) structure is common in R&D contracts where the scope of work can be uncertain and innovation is paramount. It allows the government to reimburse the contractor for allowable costs while providing an incentive fee based on achieving specific performance objectives. Compared to fixed-price contracts, CPAF offers more flexibility for evolving research needs but carries a higher risk of cost growth if not managed diligently. In the physical, engineering, and life sciences R&D sector, CPAF is often preferred over other structures like Cost Plus Fixed Fee (CPFF) when performance outcomes are difficult to predefine precisely. This structure aims to balance cost control with the need to encourage high performance and innovation, making it a suitable choice for complex, forward-looking research endeavors.

What are the key performance indicators (KPIs) typically used to evaluate success in R&D contracts of this nature?

Key Performance Indicators (KPIs) for R&D contracts like this one, focused on physical, engineering, and life sciences, often include technical milestones achieved, successful prototype development, validation of research findings through testing and analysis, and timely delivery of research reports. For a CPAF contract, specific award fee criteria would be established, such as the quality of research outcomes, adherence to project schedules, innovation demonstrated, and effective collaboration with government stakeholders. Other KPIs might involve the number of patents filed or granted, successful transition of technology to operational use, and the overall contribution to the government's strategic research objectives. The effectiveness of the research in advancing scientific knowledge or solving specific defense-related challenges is also a critical, albeit sometimes qualitative, measure of success.

What is the historical spending trend for R&D in the physical, engineering, and life sciences (except biotechnology) by the Department of the Navy?

The Department of the Navy consistently allocates significant funding towards Research and Development (R&D) across various scientific disciplines. While specific historical spending trends for the 'physical, engineering, and life sciences (except biotechnology)' category require detailed database analysis, it is generally understood that the Navy invests heavily in these areas to maintain technological superiority. This includes advancements in areas like naval platforms, materials science, underwater acoustics, cyber capabilities, and human performance optimization. Spending in this domain fluctuates based on strategic priorities, technological advancements, and budget allocations. The $27.5 million awarded in this contract represents a portion of the Navy's broader R&D portfolio, which typically spans billions of dollars annually across all its research endeavors.

Are there any specific risks associated with the 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)' NAICS code (541712) that warrant attention?

Yes, R&D contracts under NAICS code 541712 carry inherent risks common to all research endeavors. These include the high probability of research not yielding the desired outcomes, the potential for significant cost overruns due to unforeseen technical challenges, and the long lead times required for scientific breakthroughs. Intellectual property disputes can also arise. Furthermore, the rapid pace of technological change means that research conducted today might be superseded by new discoveries tomorrow, impacting the long-term value of the investment. For defense-related R&D, there's also the risk of technology falling into the wrong hands or being difficult to transition into effective operational capabilities. Careful project management, clear objective setting, and robust oversight are crucial to mitigate these risks.

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 › ECONOMIC GROWTH/PRODUCTIVITY R&D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Offers Received: 2

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 5300 INTERNATIONAL BLVD, NORTH CHARLESTON, SC, 29418

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

Financial Breakdown

Contract Ceiling: $30,418,543

Exercised Options: $30,418,543

Current Obligation: $27,567,546

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0001409D0584

IDV Type: IDC

Timeline