DoD's $830M MIT-LL Contract for Technical Services: A Deep Dive into Value and Competition
Contract Overview
Contract Amount: $830,466,077 ($830.5M)
Contractor: Massachusetts Institute of Technology
Awarding Agency: Department of Defense
Start Date: 2014-10-16
End Date: 2020-03-31
Contract Duration: 1,993 days
Daily Burn Rate: $416.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST NO FEE
Sector: Other
Official Description: IGF::CT::IGF MIT-LL FY 15 CONTINUATION CONTRACT
Place of Performance
Location: LEXINGTON, MIDDLESEX County, MASSACHUSETTS, 02421
Plain-Language Summary
Department of Defense obligated $830.5 million to MASSACHUSETTS INSTITUTE OF TECHNOLOGY for work described as: IGF::CT::IGF MIT-LL FY 15 CONTINUATION CONTRACT Key points: 1. Significant contract value of $830M awarded to a single entity. 2. Lack of competition raises questions about price discovery and potential overspending. 3. The contract spans a long duration, increasing long-term risk exposure. 4. Services fall under 'All Other Professional, Scientific, and Technical Services', a broad category.
Value Assessment
Rating: questionable
The contract's 'COST NO FEE' structure, combined with a lack of competition, makes a direct pricing assessment difficult. Without competitive bids, it's hard to determine if the $830M represents fair market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This significantly limits price discovery and may lead to higher costs for taxpayers as there was no market pressure to offer competitive pricing.
Taxpayer Impact: The absence of competition for an $830M contract suggests potential for taxpayer funds to be used inefficiently, as there was no mechanism to ensure the lowest possible price.
Public Impact
Taxpayers may be overpaying for essential technical services due to the lack of competitive bidding. The long contract duration (2014-2020) means potential inefficiencies could persist for years. The broad service category could obscure specific cost drivers and performance metrics. Reliance on a single provider for such a large sum could pose a risk if performance falters.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- High contract value
- Long contract duration
- Cost-plus contract type
Positive Signals
- Awarded to a reputable institution (MIT)
- Supports critical Department of Defense needs
Sector Analysis
The 'All Other Professional, Scientific, and Technical Services' category is broad and often involves specialized expertise. Benchmarking spending in this area is challenging without more specific service details, but $830M is a substantial investment.
Small Business Impact
There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. The sole-source nature likely precluded any opportunities for small business participation.
Oversight & Accountability
The 'COST NO FEE' structure requires robust oversight to ensure costs are reasonable and allocable. Without competition, the agency's oversight function is critical to prevent potential waste or fraud.
Related Government Programs
- All Other Professional, Scientific, and Technical Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competitive bidding may lead to inflated costs.
- Sole-source award limits market-driven price discovery.
- Long contract duration increases risk of cost escalation and performance issues.
- Cost-plus contract type shifts financial risk to the government.
- Broad service category hinders specific performance and cost analysis.
Tags
all-other-professional-scientific-and-te, department-of-defense, ma, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $830.5 million to MASSACHUSETTS INSTITUTE OF TECHNOLOGY. IGF::CT::IGF MIT-LL FY 15 CONTINUATION CONTRACT
Who is the contractor on this award?
The obligated recipient is MASSACHUSETTS INSTITUTE OF TECHNOLOGY.
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 $830.5 million.
What is the period of performance?
Start: 2014-10-16. End: 2020-03-31.
What specific technical services are covered under this broad 'All Other Professional, Scientific, and Technical Services' category, and how were they justified as a sole-source requirement?
The contract details do not specify the exact technical services. Justification for a sole-source award typically requires demonstrating that only one responsible source can provide the required services. This could be due to unique capabilities, proprietary knowledge, or critical research needs that only MIT-LL possesses.
Given the 'COST NO FEE' structure and lack of competition, what mechanisms are in place to ensure the cost-effectiveness and prevent potential overruns or inefficiencies?
The 'COST NO FEE' structure places the financial risk on the government. Robust oversight, detailed cost reporting, and regular audits by the Department of Defense are crucial to monitor expenditures, ensure reasonableness, and prevent inefficiencies. The agency must actively manage the contract to ensure value.
What is the long-term strategy for ensuring continued access to these technical services beyond the contract's expiration, and will future procurements incorporate competitive elements?
The long-term strategy is not detailed in the provided data. Future procurements should ideally incorporate competitive elements to ensure fair pricing and encourage innovation, unless a continued sole-source justification can be rigorously defended. Planning for competition post-expiration is vital for taxpayer 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: RESEARCH AND DEVELOPMENT › C – National Defense 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
Address: 244 WOOD ST, LEXINGTON, MA, 02421
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: $2,564,982,160
Exercised Options: $830,466,077
Current Obligation: $830,466,077
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2014-10-16
Current End Date: 2020-03-31
Potential End Date: 2020-03-31 00:00:00
Last Modified: 2021-06-04
More Contracts from Massachusetts Institute of Technology
- Federal Contract — $3.2B (Department of Defense)
- 200507!000127!5700!fa8721!esc/Xpk !FA872105C0002 !A!N! !Y! ! !20050401!20100331!001425594!001425594!001425594!n!massachusetts Institute of TEC!77 Massachusetts AVE Ne49-!cambridge !ma!02139!11000!017!25!cambridge !middlesex !mass !+000010298000!n!n!003260606491!ac61!rdte/Electronics&communication Eq-Basic Research!s1 !services !000 !* !541990!E! !3! ! ! ! ! !20200930!B!A! !n!z!d!u!s!1!001!n!3a!z!y!d! ! !N!V!N! ! ! ! ! !a!a!000!a!c!n! ! ! !Y! ! !0001! ! — $3.0B (Department of Defense)
- Transition of Programs From MIT LL Contract FA8721-05-C-0002 to MIT LL Contract FA8702-15-D-0001 — $1.6B (Department of Defense)
- Massachusetts Institute of Technology: Lincoln Laboratory - Research and Development — $1.4B (Department of Defense)
- MIT LL Non-Severable Task Order Program 1815 — $1.0B (Department of Defense)
View all Massachusetts Institute of Technology federal contracts →
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)