DoD's $174M contract for missile and space systems R&D with SVERDRUP TECHNOLOGY, INC. awarded via full and open competition

Contract Overview

Contract Amount: $174,252,143 ($174.3M)

Contractor: Amentum Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2000-02-01

End Date: 2011-03-31

Contract Duration: 4,076 days

Daily Burn Rate: $42.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: 200006!5700!000059!GP03 !AFFTC/PKRA R&D CONTRACTS FTC !F0461199C0003 !A!*!P00001 !20000201!20040930!007923014!007923014!074103508!N!07486!SVERDRUP TECHNOLOGY, INC. !600 WILLIAM NORTHERN BLVD.!TULLAHOMA !TN!37388!75320!051!47!TULLAHOMA !FRANKLIN !TENNESSEE !0001!+000002152638!N!N!000000000000!AC26!RDTE/MISSILE AND SPACE SYSTEMS-MGMT SUPPORT !S1 !SERVICES !3000!NOT DISCERNABLE OR CLASSIFIED !8731!3!*!*!*!B!A!*!A !N!R!2!003!B!* !C!Y!Z!* !* !N!C!*!A!Z!A!A!A!A!* !*!N!A!D!N!*!*!*!*!*!

Place of Performance

Location: EDWARDS, KERN County, CALIFORNIA, 93524

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $174.3 million to AMENTUM TECHNOLOGY, INC. for work described as: 200006!5700!000059!GP03 !AFFTC/PKRA R&D CONTRACTS FTC !F0461199C0003 !A!*!P00001 !20000201!20040930!007923014!007923014!074103508!N!07486!SVERDRUP TECHNOLOGY, INC. !600 WILLIAM NORTHERN BLVD.!TULLAHOMA !TN!37388!75320!051!47!TULLAHOMA !FRA… Key points: 1. Contract awarded for missile and space systems R&D, indicating a focus on advanced defense capabilities. 2. The contract utilized a Cost Plus Award Fee (CPAF) structure, which incentivizes contractor performance but can lead to higher costs if not managed carefully. 3. Awarded to SVERDRUP TECHNOLOGY, INC., a contractor with a significant presence in defense R&D. 4. The duration of the contract (over 11 years) suggests a long-term need for these specialized services. 5. The contract was competed fully and openly, implying a competitive bidding process that should theoretically yield fair pricing. 6. The significant dollar value suggests a high-impact project within the Department of Defense's research and development portfolio.

Value Assessment

Rating: fair

The total award amount of $174,252,142.61 over more than 11 years suggests a substantial investment in missile and space systems R&D. Benchmarking this against similar contracts is challenging without more specific details on the scope of work. However, the Cost Plus Award Fee (CPAF) pricing structure, while common for R&D, carries inherent risks of cost overruns if performance targets are not clearly defined and managed. The relatively high number of bids (3) in a full and open competition is a positive sign for price discovery, but the final negotiated price and award fee payouts would be critical to assessing true value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that all responsible sources were permitted to submit bids. Three bids were received, suggesting a moderate level of competition for this specialized R&D requirement. While three bidders is better than a sole-source award, a higher number of competitors might have been expected for a contract of this magnitude and duration, potentially leading to more aggressive pricing.

Taxpayer Impact: A full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down costs and encourage innovation. The presence of multiple bidders suggests that taxpayer funds were likely subjected to market forces, aiming for a more efficient allocation of resources.

Public Impact

The primary beneficiaries are the Department of Defense and its various branches, which will receive advanced research and development in missile and space systems. The services delivered are expected to enhance national security through technological advancements in critical defense areas. The geographic impact is primarily within the United States, with potential implications for the aerospace and defense industry hubs. Workforce implications include employment for highly skilled engineers, scientists, and technical personnel involved in research and development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The Cost Plus Award Fee (CPAF) structure can incentivize contractors to exceed performance expectations, but it also carries a risk of escalating costs if not meticulously managed and if award criteria are not sufficiently stringent.
The long contract duration (over 11 years) increases the potential for scope creep or changes in technological requirements, which could impact the overall cost and effectiveness if not managed proactively.
Limited information on the specific R&D focus makes it difficult to assess the true innovation and long-term strategic value of the awarded work.

Positive Signals

The contract was awarded through a full and open competition, indicating a commitment to leveraging market competition to achieve fair pricing and access a broad range of capabilities.
Receiving three bids suggests sufficient interest and capability within the industry to pursue this complex R&D requirement.
The substantial funding allocated signals a high priority placed on advancing missile and space systems technology by the Department of Defense.

Sector Analysis

This contract falls within the Aerospace and Defense sector, specifically focusing on Research, Development, Test, and Evaluation (RDT&E) for missile and space systems. This is a highly specialized and capital-intensive area driven by government procurement. The market is characterized by a few large, established prime contractors and a network of specialized subcontractors. Spending in this area is critical for maintaining technological superiority and national security, often involving long development cycles and significant R&D investment.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses. Given the nature of missile and space systems R&D, it is likely that the prime contractor, SVERDRUP TECHNOLOGY, INC., is a large business. While large prime contractors are often required to subcontract a portion of their work to small businesses, the specific subcontracting plan and its impact on the small business ecosystem are not detailed in the provided data.

Oversight & Accountability

Oversight for this Department of Defense contract would typically be managed by the contracting agency (Department of the Air Force) and potentially involve program managers, contracting officers, and quality assurance representatives. Inspector General (IG) offices within the DoD would have jurisdiction to investigate fraud, waste, and abuse. Transparency is often limited for R&D contracts involving sensitive technologies, but contract awards and basic performance information are generally publicly available through systems like FPDS.

Related Government Programs

Missile Defense Systems R&D
Space Systems Development
Advanced Weapons Technology
Aerospace Engineering Services
Department of Defense Research Contracts
Air Force Research Laboratory Programs

Risk Flags

Cost Plus Award Fee (CPAF) structure requires careful oversight to manage costs.
Long contract duration increases risk of scope creep and evolving requirements.
Limited number of bidders (3) may indicate potential for improved price competition.
Nature of R&D contracts can make direct value-for-money assessment challenging.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $174.3 million to AMENTUM TECHNOLOGY, INC.. 200006!5700!000059!GP03 !AFFTC/PKRA R&D CONTRACTS FTC !F0461199C0003 !A!*!P00001 !20000201!20040930!007923014!007923014!074103508!N!07486!SVERDRUP TECHNOLOGY, INC. !600 WILLIAM NORTHERN BLVD.!TULLAHOMA !TN!37388!75320!051!47!TULLAHOMA !FRANKLIN !TENNESSEE !0001!+000002152638!N!N!000000000000!AC26!RDTE/MISSILE AND SPACE SYSTEMS-MGMT SUPPORT !S1 !SERVICES !3000!NOT DISCERNABLE OR CLASSIFIED !8731!3!*!*!*!B!A!*!A !N!R!

Who is the contractor on this award?

The obligated recipient is AMENTUM TECHNOLOGY, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $174.3 million.

What is the period of performance?

Start: 2000-02-01. End: 2011-03-31.

What is the specific nature of the missile and space systems R&D being conducted under this contract?

The provided data indicates the contract is for 'RDTE/MISSILE AND SPACE SYSTEMS-MGMT SUPPORT' (Research, Development, Test, and Evaluation / Missile and Space Systems - Management Support). While the exact technical details and specific research objectives are not disclosed in this summary data, the categorization suggests work related to the development, testing, and potentially the management of systems critical for missile defense, offensive missile capabilities, and space-based assets. This could encompass areas like propulsion, guidance, control systems, materials science, or integrated system design and analysis for both ground-launched and space-borne platforms.

How does the Cost Plus Award Fee (CPAF) structure compare to other contract types for similar R&D efforts?

Cost Plus Award Fee (CPAF) contracts are frequently used for research and development efforts where the scope of work is not precisely defined at the outset, or where innovation and performance beyond minimum requirements are highly valued. In a CPAF contract, the contractor is reimbursed for allowable costs plus a fee that consists of a base amount and an award amount, which is contingent upon meeting or exceeding specific performance objectives. This differs from Cost Plus Fixed Fee (CPFF), where the fee is fixed, or Firm-Fixed-Price (FFP), where the price is set regardless of costs incurred. CPAF aims to incentivize superior performance by offering higher potential profits, but it requires robust government oversight to ensure award criteria are objective and that costs remain controlled.

What is the track record of SVERDRUP TECHNOLOGY, INC. with DoD R&D contracts of this nature?

SVERDRUP TECHNOLOGY, INC. (now part of Amentum Technology, Inc. as indicated by the 'co' field) has a history of performing significant work for the Department of Defense, particularly in engineering and technical support services. While the specific details of their past performance on missile and space systems R&D are not fully elaborated in the provided data snippet, their selection as a prime contractor for a contract of this magnitude and duration suggests a demonstrated capability and a positive track record with the government in related fields. Further investigation into their contract history and performance evaluations would be necessary for a comprehensive assessment.

How does the competition level (3 bidders) impact the value for money achieved in this contract?

A full and open competition with three bidders suggests a moderate level of market interest and capability for this specific R&D requirement. While more bidders generally lead to greater price competition, three offers indicate that the government had alternatives and was not limited to a single source. This level of competition likely provided a basis for negotiation and helped ensure that the awarded price was reasonably aligned with market rates for such specialized services. However, the ultimate value for money depends heavily on the effectiveness of the negotiated terms, the clarity of performance objectives, and the government's ability to manage the contract and award fees appropriately.

What are the potential risks associated with the long duration (over 11 years) of this contract?

The extended duration of this contract presents several potential risks. Firstly, the rapid pace of technological advancement in missile and space systems means that requirements could evolve significantly over an 11-year period, potentially leading to scope creep, contract modifications, or the need for substantial re-baselining, all of which can increase costs. Secondly, maintaining consistent oversight and performance management over such a long period can be challenging for the government. Thirdly, there's a risk that the contractor's initial cost and performance assumptions may become outdated, impacting the efficiency and cost-effectiveness of the work towards the latter stages of the contract if not actively managed.

Can we compare the per-unit cost or cost efficiency of this contract to industry benchmarks?

Directly comparing the per-unit cost or cost efficiency of this contract to industry benchmarks is not feasible with the provided data. The contract is for broad R&D and management support in missile and space systems, not for a standardized, easily quantifiable unit. The 'per-unit cost' metric is typically applicable to the procurement of goods or specific, repeatable services. For complex R&D efforts like this, value is assessed through milestones, performance metrics, and the ultimate technological advancements achieved, rather than a simple per-unit rate. Benchmarking would require detailed comparison of the scope, objectives, and outcomes against similar, highly specialized R&D contracts.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: COST PLUS AWARD FEE (R)

Contractor Details

Parent Company: Jacobs Engineering Group Inc (UEI: 074103508)

Address: 600 WILLIAM NORTHERN BLVD., TULLAHOMA, TN, 37388

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline