DoD's $37.7M R&D contract for CACI, Inc. shows fair value with moderate competition

Contract Overview

Contract Amount: $37,693,219 ($37.7M)

Contractor: CACI, Inc. - Federal

Awarding Agency: Department of Defense

Start Date: 2012-05-18

End Date: 2015-11-18

Contract Duration: 1,279 days

Daily Burn Rate: $29.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: LABOR - BASE YEAR

Place of Performance

Location: WASHINGTON NAVY YARD, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20376

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $37.7 million to CACI, INC. - FEDERAL for work described as: LABOR - BASE YEAR Key points: 1. The contract's value appears reasonable given the R&D nature and duration. 2. Competition was present but not extensive, suggesting potential for price optimization. 3. Risk indicators are moderate, typical for R&D contracts with established firms. 4. Performance context is within the Defense Information Systems Agency's mission. 5. This contract fits within the broader IT and Defense R&D sectors.

Value Assessment

Rating: fair

The contract's base year cost of approximately $37.7 million for R&D services appears within a reasonable range for specialized defense research. Benchmarking against similar R&D contracts is challenging due to the unique nature of specific research projects. However, the cost-plus-fixed-fee structure allows for some cost control, though it can also lead to cost overruns if not managed diligently. The fixed fee component provides a baseline for contractor profit.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of two bidders suggests a moderate level of competition. While more bidders could potentially drive prices lower, two bidders are sufficient to provide a basis for price comparison and ensure that the selected contractor offers a competitive technical and cost solution.

Taxpayer Impact: The full and open competition, even with two bidders, provides a degree of assurance to taxpayers that the contract was awarded on a competitive basis, likely resulting in a fair market price for the services rendered.

Public Impact

The primary beneficiaries are the Department of Defense, which receives advanced research and development capabilities. The services delivered are likely to be in the area of physical, engineering, or life sciences research, contributing to national security. The geographic impact is centered around the District of Columbia, where CACI, Inc. - Federal is located. Workforce implications include employment for highly skilled researchers and technical personnel within CACI.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can incentivize cost overruns if not closely monitored.
The specific nature of R&D can make it difficult to define scope and deliverables upfront, leading to potential scope creep.
Reliance on a single awardee for specialized R&D may limit future innovation if knowledge is not widely disseminated.

Positive Signals

Awarded through full and open competition, ensuring a broad search for qualified contractors.
CACI, Inc. - Federal is an established contractor with experience in defense and R&D.
The contract duration allows for in-depth research and development activities.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences, excluding biotechnology. This is a critical area for defense agencies seeking technological superiority. The market for defense R&D is characterized by high barriers to entry due to specialized knowledge, security clearances, and significant investment requirements. Comparable spending benchmarks are difficult to establish precisely due to the unique nature of R&D projects, but overall federal R&D spending is in the tens of billions annually.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The prime contractor, CACI, Inc. - Federal, is a large business. There is no explicit information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific contract is likely minimal, unless CACI voluntarily engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Information Systems Agency (DISA) contracting officers and program managers. Accountability measures are embedded within the cost-plus-fixed-fee structure, requiring detailed reporting and justification of costs. Transparency is generally maintained through contract reporting systems, though specific R&D project details may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Research and Development Programs
Defense Information Systems Agency IT Services
Federal Contract Research and Development

Risk Flags

Cost-plus-fixed-fee contracts require diligent oversight to prevent cost overruns.
R&D projects inherently carry a risk of not achieving desired outcomes.
The specific R&D focus area is not detailed, limiting a precise risk assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.7 million to CACI, INC. - FEDERAL. LABOR - BASE YEAR

Who is the contractor on this award?

The obligated recipient is CACI, INC. - FEDERAL.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Information Systems Agency).

What is the total obligated amount?

The obligated amount is $37.7 million.

What is the period of performance?

Start: 2012-05-18. End: 2015-11-18.

What is CACI, Inc. - Federal's track record with cost-plus-fixed-fee R&D contracts for the Department of Defense?

CACI, Inc. - Federal has a substantial track record with the Department of Defense across various contract types, including cost-plus-fixed-fee (CPFF) arrangements. CPFF contracts are common for R&D where the scope is not fully defined at the outset. CACI's experience in this area suggests they are familiar with the reporting and management requirements associated with such agreements. Analyzing their past performance on similar CPFF R&D contracts would involve reviewing metrics such as cost variances, schedule adherence, and the successful delivery of research outcomes. While specific data on past CPFF R&D performance is not detailed here, their longevity and continued awards from DoD indicate a generally acceptable performance history in managing these complex agreements.

How does the $37.7 million base year cost compare to similar R&D contracts in the physical, engineering, and life sciences sector?

Benchmarking the $37.7 million base year cost against similar R&D contracts is challenging due to the highly specialized and often unique nature of research projects within the physical, engineering, and life sciences. Federal R&D spending is vast, but contracts are typically tailored to specific scientific objectives. However, for a single base year of a significant R&D effort by a large contractor like CACI for a major agency like DISA, this figure is not inherently excessive. It suggests a substantial research effort involving numerous personnel and resources. A more precise comparison would require access to a database of comparable R&D contracts, factoring in the specific scientific domain, project complexity, and contractor overhead rates.

What are the primary risks associated with this cost-plus-fixed-fee R&D contract, and how are they mitigated?

The primary risks associated with this Cost Plus Fixed Fee (CPFF) R&D contract include potential cost overruns beyond the estimated cost, scope creep where project objectives expand without formal change orders, and the possibility of research not yielding the desired outcomes. Mitigation strategies typically involve robust oversight from the Defense Information Systems Agency (DISA) program office, including detailed review of contractor expenditures, regular progress reports, and milestone tracking. The fixed fee component provides a ceiling on contractor profit, incentivizing efficiency. Clear definition of research objectives and a strong change control process are crucial for managing scope. The inherent risk of R&D failure is managed through phased research approaches and clear go/no-go decision points.

What is the expected impact of this contract on the Defense Information Systems Agency's technological capabilities?

This contract is expected to significantly enhance the Defense Information Systems Agency's (DISA) technological capabilities by funding critical research and development in areas pertinent to national security. The specific nature of the R&D (physical, engineering, and life sciences) suggests advancements in areas such as advanced materials, new sensor technologies, improved communication systems, or novel analytical tools. Successful outcomes from this contract could lead to the development of next-generation systems, improved operational effectiveness for warfighters, and a stronger technological advantage for the U.S. military. The R&D investment aims to address future challenges and maintain DISA's role in providing cutting-edge information technology support.

How has federal spending in the R&D sector, particularly for defense, evolved over the past decade?

Federal spending in the Research and Development (R&D) sector, especially for defense, has seen fluctuations over the past decade, influenced by national security priorities, budget constraints, and technological advancements. Defense R&D spending generally remains a significant portion of the overall federal R&D budget, reflecting the continuous need for military modernization and innovation. While specific figures vary annually, there has been a sustained emphasis on areas like artificial intelligence, cybersecurity, advanced manufacturing, and hypersonics. Budgetary pressures can lead to shifts in priorities, but the core mission of maintaining technological superiority ensures consistent, albeit sometimes variable, investment in defense R&D. This contract aligns with that ongoing federal commitment.

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: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: CACI International Inc (UEI: 045534641)

Address: 14151 PARK MEADOW DR, CHANTILLY, VA, 20151

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

Financial Breakdown

Contract Ceiling: $42,677,781

Exercised Options: $42,677,781

Current Obligation: $37,693,219

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HC102808D2016

IDV Type: IDC

Timeline