DoD's $257M R&D Contract with SOBRAN, INC. Lacked Competition, Raising Cost Concerns
Contract Overview
Contract Amount: $25,726,529 ($25.7M)
Contractor: Sobran, Inc.
Awarding Agency: Department of Defense
Start Date: 2003-07-17
End Date: 2009-08-31
Contract Duration: 2,237 days
Daily Burn Rate: $11.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Place of Performance
Location: BEAVERCREEK, GREENE County, OHIO, 45432
State: Ohio Government Spending
Plain-Language Summary
Department of Defense obligated $25.7 million to SOBRAN, INC. for work described as: Key points: 1. Significant spending on R&D services, primarily in physical, engineering, and life sciences. 2. The contract was awarded on a sole-source basis, limiting competitive pricing. 3. Long contract duration (2237 days) may indicate potential for cost overruns. 4. No small business participation noted, suggesting a missed opportunity for economic inclusion.
Value Assessment
Rating: questionable
The contract's cost-plus-fixed-fee structure, combined with a lack of competition, makes it difficult to assess value. The high total award value of $257M over a long period warrants scrutiny for efficiency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This significantly limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The absence of competition for a $257M contract likely resulted in a higher price than could have been achieved through a competitive bidding process, impacting taxpayer funds.
Public Impact
Taxpayers may have overpaid due to the lack of competitive bidding on a large R&D contract. The long duration of the contract could mean funds were tied up for an extended period without clear competitive pressure on costs. Limited transparency into the specific R&D outcomes achieved for the $257M spent.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of Competition
- Cost-Plus Contract Type
- Long Contract Duration
- No Small Business Participation
Positive Signals
- Specific R&D Focus (Physical, Engineering, Life Sciences)
- Awarded by Department of Defense
Sector Analysis
This contract falls under Research and Development in the Physical, Engineering, and Life Sciences (NAICS 541710). Spending in this sector is critical for innovation but requires careful oversight due to its often intangible outcomes and complex cost structures.
Small Business Impact
The contract was not awarded to a small business, and there is no indication of subcontracting with small businesses. This represents a missed opportunity to leverage the capabilities of smaller innovative firms.
Oversight & Accountability
The sole-source nature of this large contract raises questions about the adequacy of oversight in ensuring fair pricing and efficient use of funds. Further review of the contracting process is recommended.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award bypasses competitive pricing.
- Cost-plus contract type can incentivize higher spending.
- Extended contract duration increases risk of cost escalation.
- Lack of small business participation limits economic benefits.
- Oversight challenges for sole-source, cost-plus contracts.
Tags
research-and-development-in-the-physical, department-of-defense, oh, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $25.7 million to SOBRAN, INC.. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is SOBRAN, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $25.7 million.
What is the period of performance?
Start: 2003-07-17. End: 2009-08-31.
What specific R&D advancements were achieved with the $257M awarded, and how do they align with DoD's strategic goals?
Detailed documentation on the specific research outcomes and their alignment with Department of Defense strategic objectives is crucial for justifying the $257M expenditure. Without clear metrics and deliverables tied to the contract, it's difficult to ascertain the true value and impact of the R&D performed by SOBRAN, INC.
Given the sole-source award and cost-plus structure, what mechanisms were in place to mitigate cost overruns and ensure fair pricing?
The cost-plus-fixed-fee structure, coupled with a sole-source award, inherently presents a higher risk of cost overruns and less aggressive price negotiation. Robust oversight, including detailed cost audits and performance reviews, would have been essential to ensure the government received fair value and that funds were used efficiently.
How effective was the R&D conducted by SOBRAN, INC. in meeting the Department of Defense's needs, and could similar outcomes have been achieved more cost-effectively?
Assessing the effectiveness requires a deep dive into the project's deliverables and their impact on DoD capabilities. The lack of competition makes a direct cost-effectiveness comparison impossible. However, exploring whether alternative, competitively sourced R&D efforts could yield comparable or superior results at a lower cost is a valid question for future contracting.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences
Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D
Competition & Pricing
Extent Competed: NOT COMPETED
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Contractor Details
Address: 4401 DAYTON-XENIA ROAD, DAYTON, OH, 45432
Business Categories: Black American Owned Business, Category Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, Veteran Owned Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2003-07-17
Current End Date: 2009-08-31
Potential End Date: 2009-08-31 00:00:00
Last Modified: 2022-03-29
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