Interior Department's $39M R&D contract awarded to American Science & Engineering Inc. for multi-energy portal testing

Contract Overview

Contract Amount: $39,135,574 ($39.1M)

Contractor: American Science & Engineering Inc

Awarding Agency: Department of the Interior

Start Date: 2018-12-07

End Date: 2024-05-29

Contract Duration: 2,000 days

Daily Burn Rate: $19.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: R&D

Official Description: IGF::OT::IGF R&D MULTI-ENERGY PORTAL (MEP) TEST AND EVALUATION PROJECT

Place of Performance

Location: BILLERICA, MIDDLESEX County, MASSACHUSETTS, 01821

State: Massachusetts Government Spending

Plain-Language Summary

Department of the Interior obligated $39.1 million to AMERICAN SCIENCE & ENGINEERING INC for work described as: IGF::OT::IGF R&D MULTI-ENERGY PORTAL (MEP) TEST AND EVALUATION PROJECT Key points: 1. Contract awarded on a sole-source basis, raising questions about potential cost efficiencies and market competition. 2. The contract duration of approximately 5.5 years suggests a long-term need for these specialized R&D services. 3. Focus on 'Research and Development in the Physical, Engineering, and Life Sciences' indicates a high-tech, specialized service area. 4. The firm fixed-price contract type aims to provide cost certainty for the government. 5. No small business set-aside was utilized, suggesting the primary contractor is not a small business or the requirement was not suitable for set-aside. 6. The contract's value places it within a significant range for R&D procurements in this sector.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without more detailed cost breakdowns or comparisons to similar sole-source R&D procurements. The fixed-price nature provides some cost control, but the lack of competition means there's no direct market price discovery to assess optimal value. The total award amount of $39.1 million over nearly six years warrants scrutiny to ensure the pricing reflects a fair and reasonable cost for the specialized R&D services provided.

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 among multiple vendors. This approach is typically used when a specific contractor possesses unique capabilities or when circumstances prevent a competitive process. The absence of competition limits the government's ability to leverage market forces to achieve the lowest possible price and potentially explore innovative solutions from a wider range of providers.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no competitive pressure to drive down prices. It also limits opportunities for other businesses to secure government contracts.

Public Impact

The primary beneficiaries are likely the Department of the Interior's research divisions requiring advanced testing capabilities for multi-energy portals. The services delivered involve specialized research and development, contributing to advancements in energy security and related technologies. The geographic impact is primarily within the operational scope of the Department of the Interior, potentially supporting national energy initiatives. Workforce implications include specialized R&D personnel employed by American Science & Engineering Inc. and potentially government oversight personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition for a significant R&D contract raises concerns about potential overpricing and missed opportunities for innovation from other firms.
The long contract duration without clear performance milestones or competitive re-evaluation could lead to complacency or reduced cost-consciousness over time.
Limited transparency inherent in sole-source awards makes it difficult for external stakeholders to assess the true value and necessity of the expenditure.

Positive Signals

The firm fixed-price contract type provides budget certainty for the government, mitigating the risk of cost overruns.
Awarding to a specific firm suggests they possess unique, critical expertise required for this specialized R&D project.
The contract supports critical research and development activities, potentially leading to technological advancements beneficial to national interests.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences. The market for specialized R&D services, particularly in areas like energy and advanced testing, is often characterized by a limited number of highly specialized firms. Comparable spending benchmarks for sole-source R&D contracts of this magnitude are difficult to establish without proprietary data, but such awards are typically justified by unique technical capabilities or urgent national security/research needs.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). This suggests that either the requirement was not suitable for a small business set-aside, or the primary contractor, American Science & Engineering Inc., is not considered a small business. Consequently, there are no direct subcontracting implications for small businesses mandated by this specific award, potentially limiting their participation in this particular project.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers within the Department of the Interior. As a sole-source award, transparency might be limited compared to competed contracts. Accountability measures would be defined by the contract's terms and conditions, including performance expectations and reporting requirements. The Inspector General's office for the Department of the Interior would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Department of the Interior Research and Development Programs
Energy Sector Technology Development Contracts
Advanced Materials Testing Services
National Science Foundation Research Grants
Department of Energy Applied Research Projects

Risk Flags

Sole-source award lacks competitive justification.
Potential for cost overruns or reduced value due to lack of competition.
Limited transparency in contract negotiation and execution.
Long contract duration may reduce incentive for cost efficiency.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $39.1 million to AMERICAN SCIENCE & ENGINEERING INC. IGF::OT::IGF R&D MULTI-ENERGY PORTAL (MEP) TEST AND EVALUATION PROJECT

Who is the contractor on this award?

The obligated recipient is AMERICAN SCIENCE & ENGINEERING INC.

Which agency awarded this contract?

Awarding agency: Department of the Interior (Departmental Offices).

What is the total obligated amount?

The obligated amount is $39.1 million.

What is the period of performance?

Start: 2018-12-07. End: 2024-05-29.

What specific technological advancements or research outcomes are expected from this $39 million R&D contract?

The contract, awarded to American Science & Engineering Inc. for 'Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)', focuses on a 'MULTI-ENERGY PORTAL (MEP) TEST AND EVALUATION PROJECT'. While specific outcomes are proprietary to the research, the project likely aims to develop, refine, or validate technologies related to multi-energy portals. This could involve enhancing detection capabilities, improving energy efficiency, ensuring safety protocols, or advancing the understanding of how different energy types interact within these portals. The 'test and evaluation' aspect suggests a focus on validating the performance, reliability, and effectiveness of existing or developmental MEP technologies under various conditions, contributing to the Department of the Interior's broader research objectives in areas potentially related to infrastructure, security, or resource management.

How does the $39.1 million award compare to typical R&D spending for similar projects within the Department of the Interior or related agencies?

Comparing this $39.1 million contract requires context on the specific nature of 'multi-energy portal test and evaluation'. R&D contracts can vary significantly in cost based on complexity, duration, and specialization. For instance, major infrastructure R&D projects or those involving advanced scientific equipment can easily reach tens of millions of dollars. Agencies like the Department of Energy or Department of Defense often award large R&D contracts. Without knowing the precise technological scope and the number of years this $39.1 million covers (estimated at ~5.5 years), a direct comparison is difficult. However, for a sole-source award over several years focused on specialized physical and engineering sciences, this amount is substantial but not necessarily outside the norm for critical, long-term research initiatives.

What are the risks associated with awarding a contract of this magnitude on a sole-source basis?

The primary risk of a sole-source award for a $39.1 million contract is the potential for inflated pricing due to the lack of competitive bidding. Without competing offers, the government may not achieve the best possible value for its investment. There's also a risk that alternative, potentially more innovative or cost-effective solutions from other vendors are overlooked. Furthermore, sole-source awards can sometimes indicate a lack of strategic planning or market research, or they may be necessitated by unique circumstances that warrant careful justification. Ensuring robust oversight and justification for the sole-source determination is crucial to mitigate these risks and confirm the necessity and fairness of the contract.

What is the track record of American Science & Engineering Inc. in performing government R&D contracts, particularly those of a similar scale and technical nature?

American Science & Engineering Inc. (AS&E) has a history of providing advanced technology solutions, particularly in areas like X-ray imaging and security screening. While this specific contract is for R&D, AS&E's background suggests experience with complex technological projects. Information on their specific track record with government R&D contracts of this $39 million scale and focus on 'multi-energy portals' would typically be available through government contract databases (like SAM.gov) and performance review systems (like CPARS). A thorough review would examine past performance ratings, any contract disputes or terminations, and the successful delivery of prior government R&D or technology development efforts to assess their capability and reliability for this project.

How does the 'firm fixed price' contract type influence the risk allocation between the government and American Science & Engineering Inc. for this R&D project?

A 'firm fixed price' (FFP) contract, like the one awarded to American Science & Engineering Inc., places the primary risk of cost overruns on the contractor. This means AS&E is obligated to complete the specified scope of work for the agreed-upon price, regardless of their actual costs. This benefits the government by providing cost certainty and predictability. However, for R&D projects, which inherently involve uncertainty and potential unforeseen challenges, an FFP contract can incentivize the contractor to cut corners on quality or scope if costs escalate beyond their projections. Conversely, it can also drive efficiency and innovation as the contractor seeks to manage costs effectively to maximize profit. The government's risk is primarily related to ensuring the contractor's ability to deliver the required quality and scope within the fixed price.

What is the historical spending pattern for 'Research and Development in the Physical, Engineering, and Life Sciences' within the Department of the Interior?

Historical spending patterns for 'Research and Development in the Physical, Engineering, and Life Sciences' (NAICS code 541715) within the Department of the Interior (DOI) can be analyzed through federal procurement data. DOI's R&D spending typically supports its mission-critical functions, such as resource management, environmental monitoring, geological surveys, and infrastructure resilience. While specific figures fluctuate annually, DOI consistently invests in scientific research. This $39.1 million contract represents a significant portion of the DOI's R&D budget for a specific project within this category. Examining past DOI budgets and contract awards under NAICS 541715 would reveal trends in funding levels, areas of focus (e.g., energy, environmental science, engineering), and the typical contract vehicles used (competitive vs. sole-source, types of contracts).

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) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: OSI Systems Inc

Address: 829 MIDDLESEX TPKE, BILLERICA, MA, 01821

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: $39,135,574

Exercised Options: $39,135,574

Current Obligation: $39,135,574

Actual Outlays: $38,879,807

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline