DoD's $279M contract with MITRE Corporation for technical services in FY14 shows a high cost per task

Contract Overview

Contract Amount: $279,178,933 ($279.2M)

Contractor: THE Mitre Corporation

Awarding Agency: Department of Defense

Start Date: 2013-10-01

End Date: 2014-09-30

Contract Duration: 364 days

Daily Burn Rate: $767.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Other

Official Description: IGF::OT::IGF MITRE FY14

Place of Performance

Location: BEDFORD, MIDDLESEX County, MASSACHUSETTS, 01730

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $279.2 million to THE MITRE CORPORATION for work described as: IGF::OT::IGF MITRE FY14 Key points: 1. The contract represents a significant investment in specialized technical services, highlighting the government's reliance on expert support. 2. Competition was notably absent, raising questions about potential cost efficiencies and the exploration of alternative solutions. 3. The sole-source nature of this award warrants scrutiny regarding the justification for not engaging a broader market. 4. Performance context is limited, but the duration suggests a sustained need for the services provided. 5. The contract falls within the 'All Other Professional, Scientific, and Technical Services' NAICS code, indicating a broad scope of work. 6. The high benchmark cost per task suggests a need for detailed performance metrics and value assessment.

Value Assessment

Rating: questionable

The provided data indicates a benchmark cost per task of $766,975, which appears high when compared to typical service contracts of this nature. Without specific deliverables or performance metrics, it is difficult to definitively assess value for money. However, the lack of competition and the substantial cost per task raise concerns about whether the government secured the most advantageous terms possible. Further analysis of the specific services rendered and their impact would be necessary for a more precise valuation.

Cost Per Unit: $766,975

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. The justification for this approach is not detailed in the provided data. Sole-source awards can sometimes be necessary for highly specialized services or when a specific contractor possesses unique capabilities. However, they typically limit price discovery and may result in higher costs compared to a competitive procurement.

Taxpayer Impact: The lack of competition means taxpayers may not have benefited from the cost savings that could have arisen from a bidding process. This could translate to a less efficient use of public funds.

Public Impact

The Department of Defense, specifically the Department of the Air Force, is the primary beneficiary of these technical services. The services delivered likely support critical defense operations, research, or technological development. The geographic impact is centered around the Department of Defense's operational areas, potentially nationwide or global. The contract supports a specialized workforce within The MITRE Corporation, contributing to the knowledge economy in technical fields.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings for taxpayers.
High benchmark cost per task requires further justification and performance validation.
Lack of detailed performance metrics makes value-for-money assessment challenging.
The broad NAICS code 'All Other Professional, Scientific, and Technical Services' could obscure the specific nature and cost drivers of the work.

Positive Signals

The MITRE Corporation is a well-established entity often engaged for complex technical challenges.
The contract duration suggests a consistent and recognized need for the services provided.
The Cost No Fee (CNF) contract type, while less common for sole-source, can indicate a focus on achieving specific outcomes rather than profit maximization.

Sector Analysis

This contract falls under the broad category of professional, scientific, and technical services, a significant sector for government contracting. The market for these services is vast, encompassing research and development, engineering, management consulting, and IT support. Government spending in this area is often driven by the need for specialized expertise that may not be readily available in-house. Comparable spending benchmarks would typically involve analyzing other sole-source or competed contracts for similar technical services across various agencies, considering the complexity and duration of the work.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (sb: false) and does not appear to have a small business subcontracting plan (st: MA, likely indicating Massachusetts, not a subcontracting indicator). This suggests that the primary contractor, The MITRE Corporation, is likely a large business, and the focus of this award was not on engaging the small business ecosystem. Consequently, there are no direct subcontracting implications for small businesses stemming from this specific contract award.

Oversight & Accountability

Oversight mechanisms for this contract would typically involve the contracting officer's representative (COR) and the agency's contract management office. Given the sole-source nature, oversight would focus on ensuring the contractor meets the defined scope of work and adheres to the contract terms. Transparency is limited by the lack of public detail on performance metrics and justifications for the sole-source award. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise.

Related Government Programs

Defense Research and Development Contracts
Professional and Technical Services
Sole-Source Procurements
Department of Defense IT Services
Government Consulting Services

Risk Flags

Sole-source award
High benchmark cost per task
Lack of detailed performance metrics
Broad NAICS code classification

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $279.2 million to THE MITRE CORPORATION. IGF::OT::IGF MITRE FY14

Who is the contractor on this award?

The obligated recipient is THE MITRE CORPORATION.

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 $279.2 million.

What is the period of performance?

Start: 2013-10-01. End: 2014-09-30.

What specific technical services were provided under this contract, and how were they critical to the Department of Defense's mission?

The provided data classifies this contract under NAICS code 541990, 'All Other Professional, Scientific, and Technical Services.' This broad classification suggests a wide range of potential activities, which could include scientific research, engineering support, systems analysis, program management, or specialized technical consulting. Without further details from the contract's statement of work, it is impossible to specify the exact services rendered. However, given the awarding agency (Department of Defense) and the substantial value, these services were likely critical to supporting national security objectives, advancing military technology, or improving operational efficiency. The MITRE Corporation is known for its work in areas like defense systems engineering, cybersecurity, and command and control systems, implying the services could have been related to these domains.

How does the benchmark cost per task of $766,975 compare to similar sole-source technical service contracts awarded by the DoD?

The benchmark cost per task of $766,975 for this contract is exceptionally high and warrants significant scrutiny when compared to typical sole-source technical service contracts. While specific comparisons are difficult without knowing the exact nature of the services, the duration of the contract (364 days), and the number of tasks, this figure suggests a very high-value, complex, or specialized undertaking. Standard professional services contracts, even for complex projects, often have task costs that are orders of magnitude lower. This high benchmark could indicate a contract focused on unique research, development of highly specialized systems, or extensive strategic advisory services. It is crucial to benchmark this against contracts with similar scope, complexity, and contractor expertise within the DoD to determine if it represents a fair and reasonable price.

What is the justification for awarding this contract on a sole-source basis to The MITRE Corporation?

The provided data indicates the contract was awarded as 'NOT COMPETED' and is a 'sole-source' type. The specific justification for this sole-source award is not detailed in the given information. Typically, sole-source procurements are justified when only one responsible source is available or capable of providing the required service. This could be due to unique capabilities, proprietary technology, urgent and compelling needs, or specific government-mandated research and development roles, such as those often filled by Federally Funded Research and Development Centers (FFRDCs) like MITRE. Without the official justification document (e.g., a Justification and Approval for Other than Full and Open Competition), it is impossible to ascertain the precise reasons, but it implies a determination that competitive bidding was not feasible or appropriate for this particular requirement.

What are the potential risks associated with a sole-source contract of this magnitude for technical services?

Sole-source contracts of this magnitude carry several inherent risks. Firstly, the lack of competition can lead to higher prices than might be achieved through a competitive bidding process, potentially resulting in a less efficient use of taxpayer funds. Secondly, without market validation, there's a risk that the government may not be receiving the best value or the most innovative solutions available. Thirdly, sole-source awards can sometimes create a dependency on a single contractor, potentially reducing leverage in future negotiations. Finally, if the justification for the sole-source award is weak or if performance issues arise, it can lead to program delays, cost overruns, and reduced mission effectiveness. Robust oversight and clear performance metrics are essential to mitigate these risks.

How does The MITRE Corporation's role as a Federally Funded Research and Development Center (FFRDC) influence the nature and oversight of this contract?

The MITRE Corporation operates as a Federally Funded Research and Development Center (FFRDC). FFRDCs are unique entities established to meet specific long-term research and development needs of the government that cannot be met as effectively by the private sector or government agencies alone. They are typically administered by universities, non-profits, or industrial firms. MITRE's FFRDC status often means it is tasked with objective analysis, systems engineering, research, and development, particularly in complex national security and technology domains. Contracts with FFRDCs like MITRE are often sole-source due to their unique mission and capabilities. Oversight for FFRDC contracts emphasizes ensuring objectivity, independence, and alignment with the government's strategic interests, rather than solely focusing on price competition.

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 › OTHER RESEARCH/DEVELOPMENT

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

Address: 202 BURLINGTON RD, BEDFORD, MA, 01730

Business Categories: Category Business, Corporate Entity Tax Exempt, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $337,371,208

Exercised Options: $313,947,441

Current Obligation: $279,178,933

Actual Outlays: $31,124

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NOT OBTAINED - WAIVED

Timeline