NOAA awards $11.7M for space systems R&D to Aerospace Corp, a sole-source contract

Contract Overview

Contract Amount: $11,684,333 ($11.7M)

Contractor: THE Aerospace Corporation

Awarding Agency: Department of Commerce

Start Date: 2022-09-23

End Date: 2026-07-31

Contract Duration: 1,407 days

Daily Burn Rate: $8.3K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: SPACE SYSTEMS RESEARCH AND DEVELOPMENT / ENGINEERING SUPPORT FOR OSGS.

Place of Performance

Location: SILVER SPRING, MONTGOMERY County, MARYLAND, 20910

State: Maryland Government Spending

Plain-Language Summary

Department of Commerce obligated $11.7 million to THE AEROSPACE CORPORATION for work described as: SPACE SYSTEMS RESEARCH AND DEVELOPMENT / ENGINEERING SUPPORT FOR OSGS. Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. The contract duration is substantial, spanning over three years. 3. The contractor, Aerospace Corporation, is a federally funded research and development center (FFRDC). 4. The contract type is Cost Plus Fixed Fee, which can incentivize cost overruns. 5. The NAICS code indicates a focus on physical and engineering R&D. 6. The contract is for research and development, a field often requiring specialized expertise.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature and specialized R&D focus. As a Cost Plus Fixed Fee contract, the final cost is not predetermined, making direct price comparisons difficult. However, the lack of competition inherently limits the government's ability to secure the best possible price. The Aerospace Corporation's status as an FFRDC suggests a unique capability, but the absence of competitive bidding raises questions about whether taxpayers are receiving optimal value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. The Aerospace Corporation, a non-profit entity and FFRDC, is the sole provider of these specialized space systems research and development services. This approach bypasses the typical competitive bidding process, which means there were no other bidders to compare against. While this may be justified by unique capabilities, it removes the downward pressure on pricing that competition usually provides.

Taxpayer Impact: The lack of competition means taxpayers do not benefit from the price discovery that occurs in a competitive bidding environment, potentially leading to higher costs than if multiple firms had vied for the contract.

Public Impact

The primary beneficiary is the National Oceanic and Atmospheric Administration (NOAA), which will receive advanced research and engineering support for its space systems. This contract will facilitate the development and enhancement of critical space-based assets used for weather forecasting, climate monitoring, and other vital Earth science missions. The geographic impact is primarily national, supporting NOAA's mission across the United States and its territories. The contract supports highly specialized scientific and engineering roles within the aerospace sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Cost Plus Fixed Fee contract type may not provide strong incentives for cost control.
The Aerospace Corporation's FFRDC status, while providing unique capabilities, also means it operates without direct profit motive, which can complicate standard value assessments.

Positive Signals

The Aerospace Corporation is a well-established FFRDC with deep expertise in space systems.
The contract supports critical R&D for NOAA's space-based observation systems.
The long-term nature of the contract suggests a stable, ongoing need for these specialized services.

Sector Analysis

This contract falls within the broader aerospace and defense sector, specifically focusing on research and development for space systems. The market for specialized space R&D is often characterized by high barriers to entry due to technical expertise and security requirements. Comparable spending in this niche R&D area can vary significantly based on the specific technological advancements being pursued. NOAA's investment aligns with national priorities in space exploration and Earth observation.

Small Business Impact

This contract does not appear to involve small business set-asides. As a sole-source award to The Aerospace Corporation, a large FFRDC, there are no direct subcontracting opportunities for small businesses explicitly mandated within this award structure. The focus is on specialized R&D, which may limit the applicability of typical small business contracting vehicles.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Commerce's Inspector General, with specific program oversight by NOAA officials. As a Cost Plus Fixed Fee contract, rigorous monitoring of costs and performance is crucial. Transparency is facilitated through contract reporting requirements, but the sole-source nature means public scrutiny of the competitive process is absent.

Related Government Programs

NASA Space Technology Mission Directorate
Department of Defense Space Development Programs
National Science Foundation Research Grants

Risk Flags

Sole-source award
Cost-plus contract type
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $11.7 million to THE AEROSPACE CORPORATION. SPACE SYSTEMS RESEARCH AND DEVELOPMENT / ENGINEERING SUPPORT FOR OSGS.

Who is the contractor on this award?

The obligated recipient is THE AEROSPACE CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Commerce (National Oceanic and Atmospheric Administration).

What is the total obligated amount?

The obligated amount is $11.7 million.

What is the period of performance?

Start: 2022-09-23. End: 2026-07-31.

What is the track record of The Aerospace Corporation in delivering similar space systems R&D services to government agencies?

The Aerospace Corporation has a long-standing history as a federally funded research and development center (FFRDC), primarily serving the U.S. Air Force and the Space Force, but also supporting other agencies like NOAA. Their expertise spans the entire lifecycle of space systems, from concept development and design to testing and operations. They are known for providing objective technical advice and analysis. Their track record generally indicates a high level of technical competence and reliability in complex space-related projects. Specific performance metrics for this particular contract with NOAA would be detailed in internal government performance reviews, but their overall reputation is strong in the space R&D domain.

How does the pricing structure (Cost Plus Fixed Fee) compare to other R&D contracts in the space sector?

Cost Plus Fixed Fee (CPFF) is a common contract type for research and development efforts where the scope of work may evolve or is not fully defined at the outset. In the space sector, where innovation and exploration are key, CPFF allows flexibility. However, it shifts much of the financial risk to the government. Compared to fixed-price contracts, CPFF can lead to higher overall costs if not managed diligently, as the contractor is reimbursed for all allowable costs plus a fixed fee. Other R&D contracts might use Cost Plus Incentive Fee (CPIF) or other variations that introduce performance incentives to better align contractor and government interests and control costs.

What are the key risks associated with a sole-source R&D contract of this magnitude and duration?

The primary risk with a sole-source R&D contract is the lack of competitive pressure, which can lead to inflated pricing and reduced innovation incentives for the contractor. Since there are no competing proposals, the government has less leverage to negotiate the best possible price or terms. The duration (over three years) increases the risk of cost escalation and potential scope creep without the checks and balances of a competitive process. Furthermore, reliance on a single contractor, even an FFRDC like Aerospace Corporation, can create vendor lock-in and limit the government's ability to adopt alternative solutions or technologies that might emerge during the contract period.

How effective is the Aerospace Corporation in fulfilling NOAA's space systems R&D needs, based on past performance?

While specific performance data for this exact NOAA contract is not publicly detailed, The Aerospace Corporation's designation as an FFRDC implies a high level of trust and effectiveness in fulfilling critical national security and scientific research needs. They are structured to provide objective, independent research and analysis. Their long-term relationship with government agencies, including significant work for the Air Force and Space Force, suggests a consistent ability to meet complex technical requirements. For NOAA, their role likely involves providing specialized engineering support, system analysis, and research crucial for maintaining and advancing the agency's satellite and space-based observation capabilities.

What is the historical spending trend for similar space systems R&D contracts awarded by NOAA or related agencies?

Historical spending on space systems R&D by agencies like NOAA and NASA has generally trended upwards, reflecting the increasing importance of satellite technology for Earth observation, climate science, and weather forecasting. While specific figures for NOAA's space R&D fluctuate annually based on program needs and budget allocations, investments in this area are substantial and ongoing. Agencies often rely on a mix of competitive contracts and sole-source awards to FFRDCs for highly specialized or foundational research. Understanding the broader trend indicates a sustained commitment to advancing space-based capabilities, making contracts like this a regular feature of agency budgets.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 2310 E EL SEGUNDO BLVD, EL SEGUNDO, CA, 90245

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: $12,701,721

Exercised Options: $12,701,721

Current Obligation: $11,684,333

Actual Outlays: $7,303,648

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: 1332KP22DNEEG0002

IDV Type: IDC

Timeline