DOE's $28.7M technical research contract with Nevada System of Higher Education awarded without competition
Contract Overview
Contract Amount: $28,712,980 ($28.7M)
Contractor: Nevada System of Higher Education
Awarding Agency: Department of Energy
Start Date: 2006-08-31
End Date: 2011-10-31
Contract Duration: 1,887 days
Daily Burn Rate: $15.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST NO FEE
Sector: R&D
Official Description: DRI FOLLOW-ON CONTRACT FOR TECHNICAL RESEARCH, ENGINEERING,&DEVELOPMENT SERVICES
Place of Performance
Location: RENO, WASHOE County, NEVADA, 89512
State: Nevada Government Spending
Plain-Language Summary
Department of Energy obligated $28.7 million to NEVADA SYSTEM OF HIGHER EDUCATION for work described as: DRI FOLLOW-ON CONTRACT FOR TECHNICAL RESEARCH, ENGINEERING,&DEVELOPMENT SERVICES Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. Long contract duration of 1887 days suggests a need for sustained technical support. 3. The contract's value of $28.7 million over its term warrants scrutiny for cost-effectiveness. 4. Services provided fall under 'All Other Professional, Scientific, and Technical Services,' a broad category. 5. The absence of competition raises questions about whether the government secured the best possible value. 6. Contract awarded to an educational institution, which may have different cost structures than private firms.
Value Assessment
Rating: questionable
Benchmarking the value of this $28.7 million contract is challenging due to its sole-source nature and the broad scope of 'technical research, engineering, & development services.' Without competitive bids, it's difficult to assess if the pricing is fair or if alternative, more cost-effective solutions were overlooked. The cost-no-fee (Cost Plus Fixed Fee) pricing structure, while common for R&D, can sometimes lead to cost overruns if not managed tightly. Comparing this to similar R&D contracts within the Department of Energy would be necessary for a more definitive value assessment.
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 potential vendors. This approach is typically used when only one vendor possesses the unique capabilities or resources required for the service, or in cases of urgent need. The lack of competition means that the Department of Energy did not benefit from the price reductions and innovation that can arise from a competitive bidding process. This raises concerns about whether the government obtained the most advantageous terms and pricing possible.
Taxpayer Impact: Taxpayers may have paid a premium for these services due to the absence of competitive pressure. Without multiple bids, there is less assurance that the negotiated price reflects the lowest reasonable cost for the required technical research and development.
Public Impact
The Nevada System of Higher Education benefits through funding for its research and development capabilities. The contract supports advanced technical research, engineering, and development services for the Department of Energy. Geographic impact is primarily within Nevada, where the educational institutions are located. Workforce implications include employment for researchers, engineers, and technical staff at the Nevada System of Higher Education.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competitive benchmarking and potential cost savings.
- Broad service category ('All Other Professional, Scientific, and Technical Services') can obscure specific performance metrics.
- Long contract duration (1887 days) requires ongoing vigilance for scope creep and cost control.
Positive Signals
- Award to an educational institution may foster long-term research partnerships and talent development.
- Focus on technical research and development aligns with strategic government objectives in science and technology.
Sector Analysis
The 'All Other Professional, Scientific, and Technical Services' category (NAICS 541990) is a broad segment of the professional services market. This contract falls within the government's significant spending on research and development (R&D) and technical support services. The market for such services is diverse, including universities, research institutions, and private sector firms. Comparable spending benchmarks would typically involve analyzing other large R&D contracts awarded by agencies like the Department of Energy to similar types of organizations.
Small Business Impact
This contract was not awarded as a small business set-aside, and there is no indication of subcontracting requirements for small businesses. The award to a large educational system suggests that the primary focus was on specialized research capabilities rather than promoting small business participation. This contract does not appear to directly contribute to the small business ecosystem or provide opportunities for small business subcontractors.
Oversight & Accountability
Oversight for this contract would primarily reside with the Department of Energy's contracting officers and program managers. Accountability measures would be defined in the contract terms, focusing on deliverables and milestones. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract's execution.
Related Government Programs
- Department of Energy Research and Development Programs
- Federal Scientific and Technical Services Contracts
- University Research Partnerships with Government
Risk Flags
- Sole-source award may lead to higher costs.
- Lack of competition limits price discovery.
- Broad service category requires careful performance monitoring.
Tags
department-of-energy, research-and-development, technical-services, sole-source, cost-plus-fixed-fee, higher-education, nevada, professional-scientific-technical-services, long-term-contract, federal-spending
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $28.7 million to NEVADA SYSTEM OF HIGHER EDUCATION. DRI FOLLOW-ON CONTRACT FOR TECHNICAL RESEARCH, ENGINEERING,&DEVELOPMENT SERVICES
Who is the contractor on this award?
The obligated recipient is NEVADA SYSTEM OF HIGHER EDUCATION.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $28.7 million.
What is the period of performance?
Start: 2006-08-31. End: 2011-10-31.
What specific technical research, engineering, and development services were performed under this contract?
The contract data indicates the broad category of 'All Other Professional, Scientific, and Technical Services' (NAICS 541990). While the contract title mentions 'Technical Research, Engineering, & Development Services,' the specific nature of these services is not detailed in the provided data. To understand the precise work performed, one would need to consult the contract's Statement of Work (SOW) or task orders issued against it. These documents would outline the specific research objectives, engineering challenges addressed, and development activities undertaken for the Department of Energy. Without access to these details, it's difficult to assess the technical merit or impact of the work.
Why was this contract awarded on a sole-source basis instead of being competed?
The provided data states the contract was 'NOT COMPETED,' indicating a sole-source award. The rationale for sole-sourcing typically involves specific circumstances such as the unique capabilities of the contractor, urgent and compelling needs, or situations where only one responsible source can provide the required services. For this Department of Energy contract with the Nevada System of Higher Education, the justification would likely stem from specialized research expertise, proprietary technology, or a long-standing, established relationship that made competition impractical or detrimental to the program's continuity. A formal justification document (e.g., a Justification for Other Than Full and Open Competition) would contain the detailed reasoning.
How does the $28.7 million cost compare to similar R&D contracts awarded by the Department of Energy?
Directly comparing the $28.7 million cost is difficult without knowing the specific scope and duration of comparable contracts. However, the contract's duration of 1887 days (over 5 years) suggests a substantial, long-term research effort. The Department of Energy awards numerous contracts for R&D, ranging from millions to hundreds of millions of dollars, often to universities and research institutions. To benchmark this contract's value, one would need to identify other DOE contracts for similar 'technical research, engineering, & development services' awarded to educational institutions over comparable timeframes. Factors like the specific scientific domain, complexity of research, and required personnel expertise would influence cost comparisons.
What is the track record of the Nevada System of Higher Education as a federal contractor, particularly with the Department of Energy?
The Nevada System of Higher Education (NSHE) is an entity comprising multiple institutions, and its track record as a federal contractor would be assessed based on its history of receiving and successfully executing government contracts. As a recipient of this $28.7 million Department of Energy contract, NSHE demonstrated its capability to meet DOE's requirements. Federal procurement databases would show other contracts awarded to NSHE by various agencies, including DOE. A thorough assessment would involve reviewing past performance evaluations, any contract disputes or terminations, and the successful completion of previous research and development projects funded by the government to gauge their reliability and effectiveness as a contractor.
What are the potential risks associated with a sole-source contract for technical R&D services?
The primary risk of a sole-source contract for technical R&D is the potential for inflated costs due to the lack of competitive pressure. Without competing bids, the government may not achieve the best possible price. Another risk is a potential lack of innovation, as the contractor may have less incentive to explore novel or more efficient approaches compared to a competitive environment. Furthermore, there's a risk of vendor lock-in, where the government becomes dependent on a single provider, making future transitions difficult or costly. Ensuring adequate oversight and robust contract management becomes even more critical to mitigate these risks when competition is absent.
How does this contract align with the Department of Energy's strategic goals in research and development?
This contract, focused on 'Technical Research, Engineering, & Development Services,' directly aligns with the Department of Energy's core mission, which includes advancing scientific discovery, innovation, and clean energy technologies. The specific alignment would depend on the precise nature of the research conducted under the contract, which falls under the broad NAICS code 541990. If the R&D efforts contribute to areas like energy efficiency, renewable energy, nuclear science, or fundamental scientific understanding relevant to energy, then it strongly supports DOE's strategic objectives. Awarding such contracts to higher education institutions like NSHE also fosters the development of future scientists and engineers, contributing to the nation's long-term R&D capacity.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services
Product/Service Code: RESEARCH AND DEVELOPMENT › General Science and Technology R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST NO FEE (S)
Evaluated Preference: NONE
Contractor Details
Parent Company: State of Nevada (UEI: 067808063)
Address: 2215 RAGGIO PARKWAY, RENO, NV, 02
Business Categories: Category Business, Educational Institution, Higher Education, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $42,024,904
Exercised Options: $42,024,904
Current Obligation: $28,712,980
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 2006-08-31
Current End Date: 2011-10-31
Potential End Date: 2011-10-31 00:00:00
Last Modified: 2014-09-03
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