Over $2 billion awarded to Oak Ridge Associated Universities for technical program management services by the Department of Energy
Contract Overview
Contract Amount: $2,064,774,056 ($2.1B)
Contractor: OAK Ridge Associated Universities, Incorporated
Awarding Agency: Department of Energy
Start Date: 2006-01-01
End Date: 2016-06-30
Contract Duration: 3,833 days
Daily Burn Rate: $538.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Official Description: TECHNICAL SERVICES TO MANAGE AND DIRECT THE PROGRAMS OF ORISE
Place of Performance
Location: OAK RIDGE, ANDERSON County, TENNESSEE, 37830
Plain-Language Summary
Department of Energy obligated $2.06 billion to OAK RIDGE ASSOCIATED UNIVERSITIES, INCORPORATED for work described as: TECHNICAL SERVICES TO MANAGE AND DIRECT THE PROGRAMS OF ORISE Key points: 1. The contract provided essential technical services for managing and directing programs, indicating a critical support role for the Department of Energy. 2. Awarded through full and open competition, suggesting a robust process for selecting the contractor. 3. The contract type, Cost Plus Award Fee, incentivizes performance while allowing for cost reimbursement. 4. A long duration of over 10 years suggests a stable, long-term need for these services. 5. The significant total value points to a substantial program or set of programs being managed. 6. The contractor, Oak Ridge Associated Universities, Inc., has a long history with the Department of Energy, implying established expertise.
Value Assessment
Rating: good
The total award amount of over $2 billion over a decade represents a significant investment in technical program management. Benchmarking this against similar large-scale technical support contracts is challenging without more specific service details. However, the Cost Plus Award Fee structure suggests an attempt to align contractor performance with desired outcomes, potentially leading to better value than a simple cost-reimbursement contract. The long duration and consistent funding indicate the agency found the services to be of good value over time.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to compete for the work. This competitive process is generally expected to drive down prices and ensure the government receives the best value. The fact that a single award was made suggests that one offeror best met the government's requirements.
Taxpayer Impact: Full and open competition is the most advantageous for taxpayers as it maximizes the potential for cost savings and ensures that the contract is awarded to the most capable and cost-effective provider.
Public Impact
The primary beneficiaries are the Department of Energy programs that received technical management and direction, ensuring their effective execution. Services delivered include the management and direction of various ORISE programs, which are crucial for scientific and technical initiatives. The geographic impact is primarily centered around Oak Ridge, Tennessee, where the contractor is based, but the programs managed likely have national implications. Workforce implications include the employment of personnel by Oak Ridge Associated Universities to fulfill the contract requirements, supporting scientific and technical jobs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Award Fee contracts can sometimes lead to cost overruns if not managed carefully, as the contractor is reimbursed for costs incurred.
- The long duration of the contract could potentially lead to complacency or a lack of innovation if not actively managed and re-evaluated.
- The sheer scale of the contract value necessitates robust oversight to ensure funds are used efficiently and effectively.
Positive Signals
- Awarded through full and open competition, indicating a competitive environment that should drive value.
- The Cost Plus Award Fee structure incentivizes contractor performance, aligning their goals with the agency's objectives.
- The contractor, Oak Ridge Associated Universities, has a long-standing relationship with the Department of Energy, suggesting a deep understanding of agency needs and a proven track record.
- The contract's long duration implies consistent delivery of satisfactory services over an extended period.
Sector Analysis
This contract falls within the Professional, Scientific, and Technical Services sector, specifically under NAICS code 541990 (All Other Professional, Scientific, and Technical Services). This sector is characterized by firms providing specialized expertise and support across a wide range of scientific and technical disciplines. The Department of Energy, like many large federal agencies, relies heavily on such services to manage complex research, development, and operational programs. Comparable spending benchmarks would involve analyzing other large-scale technical support contracts awarded by agencies like the Department of Defense or NASA, focusing on the scope of services and contract types.
Small Business Impact
The data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). As a large, sole-source award to Oak Ridge Associated Universities, Inc., the primary impact on small businesses would likely be through subcontracting opportunities. The extent of these opportunities would depend on the prime contractor's subcontracting plan and the nature of the services required. Without specific subcontracting data, it's difficult to assess the direct impact on the small business ecosystem, though large prime contracts can sometimes create downstream opportunities.
Oversight & Accountability
Oversight for this contract would primarily reside with the Department of Energy's contracting officers and program managers. The Cost Plus Award Fee structure inherently includes performance metrics and award criteria that serve as accountability measures. Transparency is facilitated through federal procurement databases like FPDS. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.
Related Government Programs
- Department of Energy Research and Development Programs
- Oak Ridge National Laboratory Support Services
- Scientific and Technical Consulting Services
- Federal Program Management Contracts
- Cost Plus Award Fee Contracts
Risk Flags
- Long contract duration may reduce flexibility.
- CPAF structure requires diligent oversight to manage costs.
- Potential for scope creep without clear performance metrics.
Tags
professional-scientific-technical-services, department-of-energy, oak-ridge-associated-universities, definitive-contract, full-and-open-competition, cost-plus-award-fee, program-management, tennessee, large-contract, long-term-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $2.06 billion to OAK RIDGE ASSOCIATED UNIVERSITIES, INCORPORATED. TECHNICAL SERVICES TO MANAGE AND DIRECT THE PROGRAMS OF ORISE
Who is the contractor on this award?
The obligated recipient is OAK RIDGE ASSOCIATED UNIVERSITIES, INCORPORATED.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $2.06 billion.
What is the period of performance?
Start: 2006-01-01. End: 2016-06-30.
What specific ORISE programs were managed under this contract, and what were their primary objectives?
The contract data indicates 'TECHNICAL SERVICES TO MANAGE AND DIRECT THE PROGRAMS OF ORISE.' ORISE, the Oak Ridge Institute for Science and Education, manages a wide array of programs for the Department of Energy (DOE) and other federal agencies. These programs often focus on science education, workforce development, research opportunities for students and faculty, and specialized scientific research support. Examples include fellowships, internships, and research collaborations. The specific programs managed under this $2+ billion contract would have been detailed in the contract's statement of work, likely encompassing a broad portfolio of ORISE's activities aimed at advancing scientific research, education, and technology transfer in alignment with DOE's strategic goals. Without access to the detailed SOW, pinpointing every program is not possible, but the overarching goal was to ensure the effective operational management and direction of these diverse initiatives.
How did the performance metrics for the 'Award Fee' component influence the contractor's actions and the overall value delivered?
The 'Award Fee' component of a Cost Plus Award Fee (CPAF) contract is designed to incentivize superior performance by providing additional compensation based on the achievement of specific, pre-defined criteria. For this contract, the Department of Energy would have established objective and subjective metrics related to the technical management and direction of ORISE programs. These could include factors like program efficiency, successful completion of milestones, stakeholder satisfaction, adherence to budget, innovation, and effective resource allocation. The contractor, Oak Ridge Associated Universities, Inc., would have been motivated to exceed baseline performance expectations to earn the maximum award fee. This structure encourages proactive problem-solving, strategic planning, and a focus on delivering high-quality outcomes beyond mere contract compliance. The value delivered is theoretically enhanced as the contractor is rewarded for achieving results that align closely with the government's desired program objectives, potentially leading to more effective and efficient program execution than a standard cost-plus contract.
What is the historical spending trend for technical services related to ORISE programs managed by the Department of Energy?
The provided data reflects a single, large contract awarded from January 1, 2006, to June 30, 2016, with a total value exceeding $2 billion. This indicates a substantial and consistent level of spending on technical services for ORISE program management during that period. The duration and magnitude suggest that these services were deemed critical and valuable by the Department of Energy. To understand the broader historical trend, one would need to examine spending patterns before 2006 and after 2016, looking for predecessor or successor contracts, or other contract vehicles used for similar purposes. It's possible that spending has been consolidated under this large award, or that other contracts have supplemented it. However, this specific contract alone demonstrates a significant, long-term financial commitment to managing ORISE programs.
How does the contractor's track record with the Department of Energy compare to other potential bidders for similar technical management services?
Oak Ridge Associated Universities, Inc. (ORAU) has a well-established and extensive history of working with the Department of Energy (DOE), particularly in managing scientific and educational programs like those under ORISE. This long-standing relationship implies a deep institutional knowledge of DOE's mission, policies, and operational requirements, as well as a proven ability to execute complex technical management tasks successfully. When competing for such contracts, a strong past performance record with the specific agency is a significant advantage. While other organizations may possess technical expertise, ORAU's demonstrated success and familiarity with DOE's unique environment likely made them a highly competitive bidder. This track record reduces perceived risk for the agency, as they have a history of ORAU's performance to evaluate, potentially contributing to their selection in a full and open competition.
What are the potential risks associated with a Cost Plus Award Fee contract of this magnitude and duration?
Cost Plus Award Fee (CPAF) contracts, especially those of significant magnitude ($2+ billion) and long duration (over 10 years), carry inherent risks. A primary concern is cost control; while the 'cost plus' aspect means the government reimburses allowable costs, the 'award fee' is discretionary and based on performance. If oversight is insufficient or performance metrics are poorly defined, costs could escalate beyond initial expectations without commensurate performance gains. There's also a risk that the contractor might focus excessively on achieving award fee criteria, potentially neglecting other important aspects of the program not explicitly measured. Furthermore, the long duration can lead to contractor complacency or a reduced incentive to innovate if not actively managed. Ensuring robust oversight, clear and measurable performance standards, and regular re-evaluation of the contract's objectives are crucial to mitigate these risks and ensure the government receives optimal value.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services
Product/Service Code: EDUCATION AND TRAINING › EDUCATION AND TRAINING SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Address: 130 BADGER RD, OAK RIDGE, TN, 37830
Business Categories: Category Business, Nonprofit Organization, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $3,079,647,211
Exercised Options: $3,079,647,211
Current Obligation: $2,064,774,056
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Timeline
Start Date: 2006-01-01
Current End Date: 2016-06-30
Potential End Date: 2016-06-30 00:00:00
Last Modified: 2020-08-18
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