DoD awards $633.6M contract to MIT for technical services, raising competition concerns
Contract Overview
Contract Amount: $633,593,104 ($633.6M)
Contractor: Massachusetts Institute of Technology
Awarding Agency: Department of Defense
Start Date: 2015-10-19
End Date: 2015-10-19
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST NO FEE
Sector: Other
Official Description: IGF::OT::IGF MIT-LL FY16 CONTINUATION CONTRACT
Place of Performance
Location: LEXINGTON, MIDDLESEX County, MASSACHUSETTS, 02421
Plain-Language Summary
Department of Defense obligated $633.6 million to MASSACHUSETTS INSTITUTE OF TECHNOLOGY for work described as: IGF::OT::IGF MIT-LL FY16 CONTINUATION CONTRACT Key points: 1. Significant award value of $633.6 million for professional, scientific, and technical services. 2. Sole source award to MIT suggests limited competition, potentially impacting price discovery. 3. The contract falls under 'All Other Professional, Scientific, and Technical Services' (NAICS 541990). 4. Awarded by the Department of the Air Force, part of the Department of Defense. 5. The contract type is 'Cost No Fee', which can present oversight challenges.
Value Assessment
Rating: questionable
The 'Cost No Fee' contract type makes a direct pricing assessment difficult without further cost breakdowns. Benchmarking is challenging due to the broad service category and sole-source nature.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and may not ensure the government receives the best value.
Taxpayer Impact: The lack of competition for a $633.6 million contract could result in higher costs for taxpayers than if it were competitively bid.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. Research and development funding allocation could be impacted by non-competitive awards. The specific technical services provided are not detailed, making public understanding difficult. MIT's role as a sole-source recipient raises questions about equitable distribution of federal funds.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of competition
- Broad service category
Positive Signals
- Award to a reputable institution (MIT)
- Potential for critical research and development
Sector Analysis
This contract falls under professional, scientific, and technical services, a broad category. Benchmarking is difficult without specific service details, but large sole-source awards in this sector warrant scrutiny.
Small Business Impact
This contract was awarded directly to MIT and does not indicate any subcontracting opportunities for small businesses. The sole-source nature limits potential for small business participation.
Oversight & Accountability
The 'Cost No Fee' structure requires robust oversight to ensure costs are reasonable and allocable. The lack of competition necessitates increased vigilance from oversight bodies to ensure value for money.
Related Government Programs
- All Other Professional, Scientific, and Technical Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
- Limited transparency on services
- No small business participation noted
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 $633.6 million to MASSACHUSETTS INSTITUTE OF TECHNOLOGY. IGF::OT::IGF MIT-LL FY16 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 $633.6 million.
What is the period of performance?
Start: 2015-10-19. End: 2015-10-19.
What specific technical services are being procured under this contract, and how do they align with the Air Force's mission requirements?
The contract is categorized under 'All Other Professional, Scientific, and Technical Services' (NAICS 541990). While MIT is a leading research institution, the broad nature of this category makes it difficult to ascertain the precise services. Further details are needed to understand how these services directly support the Department of the Air Force's strategic objectives and operational needs.
What justification was provided for awarding this significant contract on a sole-source basis, and what steps were taken to explore competitive alternatives?
The data indicates the contract was 'NOT COMPETED'. A sole-source award of this magnitude typically requires a strong justification, such as unique capabilities or urgent needs. Without this justification, it raises concerns about whether the government adequately explored options to foster competition and ensure the best possible pricing and value for taxpayers.
How will the 'Cost No Fee' contract structure be managed to ensure cost control and prevent potential overruns, given the lack of a profit motive for the contractor?
The 'Cost No Fee' (CNF) structure means the contractor is reimbursed for allowable costs but receives no fee or profit. This necessitates rigorous government oversight of all incurred costs to ensure they are reasonable, allocable, and allowable under the contract terms. Effective management requires detailed cost monitoring and auditing processes to prevent unnecessary expenditures.
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, Educational Institution, Higher Education, Nonprofit Organization, Not Designated a Small Business, Higher Education (Private), Higher Education (Public), Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $633,738,099
Exercised Options: $633,738,099
Current Obligation: $633,593,104
Actual Outlays: $738,234
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2015-10-19
Current End Date: 2015-10-19
Potential End Date: 2015-10-19 00:00:00
Last Modified: 2023-06-22
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