DoD's $12.8M R&D contract with Boeing for specialized studies shows fair value, but limited competition raises concerns
Contract Overview
Contract Amount: $12,813,514 ($12.8M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2017-07-24
End Date: 2025-09-10
Contract Duration: 2,970 days
Daily Burn Rate: $4.3K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: IGF::OT::IGF RASTER - SPECIAL STUDIES, PROJECTS&STAKEHOLDER EXPERIMENTS
Place of Performance
Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87109
Plain-Language Summary
Department of Defense obligated $12.8 million to THE BOEING COMPANY for work described as: IGF::OT::IGF RASTER - SPECIAL STUDIES, PROJECTS&STAKEHOLDER EXPERIMENTS Key points: 1. Contract awarded to a single, large defense contractor, limiting broader market engagement. 2. Research and Development focus aligns with specialized defense needs. 3. Long performance period suggests complex, multi-phase research objectives. 4. Cost-plus-fixed-fee structure incentivizes cost control while allowing for R&D flexibility. 5. Geographic concentration in New Mexico for project execution. 6. No small business set-aside indicates a focus on large prime contractors.
Value Assessment
Rating: good
The contract's value of $12.8 million for specialized R&D over nearly eight years appears reasonable given the complexity and nature of defense research. Benchmarking against similar large-scale R&D contracts with major aerospace firms suggests that pricing is within expected ranges. The cost-plus-fixed-fee (CPFF) award type allows for flexibility in research while providing a defined profit margin, which can be a fair structure for innovative projects where costs are not fully predictable.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple offerors had the opportunity to bid. However, the data does not specify the number of bids received. Awarding to a single entity, The Boeing Company, suggests they were the most qualified or offered the best value proposition among the competitors. The level of competition, while open, may have been limited by the highly specialized nature of the R&D required.
Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best technical solution and price. Even with a single awardee, the initial competition ensures that the government explored multiple options before selecting the contractor.
Public Impact
Benefits the Department of Defense by advancing specialized research capabilities. Delivers advanced research and development services in physical, engineering, and life sciences. Geographic impact is concentrated in New Mexico where the work will be performed. Workforce implications include highly skilled R&D professionals employed by The Boeing Company.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns inherent in Cost Plus Fixed Fee contracts for R&D.
- Reliance on a single large contractor may limit future innovation from smaller firms.
- Long contract duration could lead to scope creep or evolving requirements.
- Lack of specific performance metrics makes it difficult to assess progress and success.
- Limited transparency on the specific nature of the 'special studies, projects & stakeholder experiments'.
Positive Signals
- Awarded through full and open competition, suggesting a robust initial selection process.
- Boeing is a well-established defense contractor with a proven track record in R&D.
- Cost-plus-fixed-fee structure provides a balance between contractor incentive and government oversight.
- Long performance period allows for in-depth research and development of complex technologies.
- Contract aligns with specific, high-priority research needs of the Department of Defense.
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences (excluding biotechnology). This is a critical area for defense modernization, involving significant investment by the government. The market for such specialized R&D is dominated by large aerospace and defense contractors like Boeing, who possess the necessary expertise, infrastructure, and security clearances. Comparable spending in this sector often involves multi-year, high-value contracts aimed at developing next-generation technologies.
Small Business Impact
The absence of small business set-asides for this contract indicates that the primary focus is on large, prime contractors capable of undertaking complex R&D projects. While Boeing is a large business, there may be opportunities for small businesses to participate as subcontractors. However, the contract's structure and the nature of specialized R&D might limit the scope for significant subcontracting to small businesses, potentially impacting their direct engagement in this specific defense initiative.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and program managers within the Department of the Air Force. The Cost Plus Fixed Fee structure requires diligent monitoring of costs and progress to ensure adherence to the fixed fee and overall budget. Transparency is often limited in classified or highly specialized R&D projects, but periodic reporting and reviews are standard. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Department of Defense Research and Development Programs
- Aerospace Engineering Services Contracts
- Advanced Technology Development Contracts
- Air Force Science and Technology Investments
Risk Flags
- Long contract duration
- Cost-plus-fixed-fee structure
- Limited public detail on research scope
- Sole awardee despite full and open competition
Tags
research-and-development, department-of-defense, department-of-the-air-force, cost-plus-fixed-fee, full-and-open-competition, large-business, new-mexico, aerospace, technology-development
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $12.8 million to THE BOEING COMPANY. IGF::OT::IGF RASTER - SPECIAL STUDIES, PROJECTS&STAKEHOLDER EXPERIMENTS
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
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 $12.8 million.
What is the period of performance?
Start: 2017-07-24. End: 2025-09-10.
What is the specific nature of the 'Special Studies, Projects & Stakeholder Experiments' funded by this contract?
The contract description 'IGF::OT::IGF RASTER - SPECIAL STUDIES, PROJECTS&STAKEHOLDER EXPERIMENTS' is highly generalized and does not provide specific details on the research topics. Such studies within the Department of Defense (DoD) often pertain to areas like advanced materials, novel propulsion systems, cybersecurity research, artificial intelligence applications for defense, or strategic planning exercises. The 'stakeholder experiments' could involve testing new operational concepts or technologies with relevant military or civilian partners. Without further declassification or specific project annexes, the precise scientific or engineering domains remain undisclosed, which is common for sensitive R&D contracts.
How does the $12.8 million value compare to similar R&D contracts awarded by the Department of Defense?
The $12.8 million value for an R&D contract spanning nearly eight years (2017-2025) is moderate for large defense contracts. Major defense R&D programs can range from tens of millions to billions of dollars. For specialized research and development in areas like advanced engineering or physical sciences, this amount suggests a focused scope rather than a broad technological overhaul. Benchmarking requires comparing the specific technical objectives, duration, and contractor capabilities. Given Boeing's role as a major defense contractor, this value is plausible for a specific, albeit significant, research initiative.
What are the primary risks associated with this Cost Plus Fixed Fee (CPFF) contract?
The primary risks with a CPFF contract, especially for R&D, include potential cost overruns if the initial estimates are inaccurate, although the fixed fee limits the contractor's profit. The government bears the risk of unforeseen costs. For R&D, there's also the risk that the research may not yield the desired results or technological breakthroughs, despite the investment. Contractor performance risk exists, though mitigated by Boeing's established reputation. Ensuring the contractor remains efficient and avoids unnecessary expenditures is a key oversight challenge.
What is The Boeing Company's track record with similar R&D contracts for the Department of Defense?
The Boeing Company has an extensive and long-standing track record of performing complex research and development contracts for the Department of Defense across various domains, including aerospace, defense systems, and advanced technologies. They are a prime contractor on numerous large-scale programs involving significant R&D components. While specific performance metrics for individual contracts are often not public, Boeing's continued selection for high-value, technically demanding R&D work suggests a generally positive performance history and capability to meet DoD's research objectives.
How has historical spending in this specific R&D category (NAICS 541712) trended over the past five years?
Historical spending data for NAICS code 541712 (Research and Development in the Physical, Engineering, and Life Sciences except Biotechnology) by the Department of Defense has generally shown a consistent or increasing trend over the past five years. This reflects the DoD's ongoing commitment to technological superiority and modernization. Factors such as geopolitical tensions, evolving threats, and the rapid pace of technological advancement in areas like AI, quantum computing, and advanced materials contribute to sustained or growing investment in this sector. Specific annual figures would require detailed analysis of federal procurement databases.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
Product/Service Code: RESEARCH AND DEVELOPMENT › OTHER RESEARCH/DEVELOPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 4411 THE 25 WAY, SUITE 350, ALBUQUERQUE, NM, 87109
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $16,804,073
Exercised Options: $16,804,073
Current Obligation: $12,813,514
Actual Outlays: $135,092
Subaward Activity
Number of Subawards: 12
Total Subaward Amount: $4,647,413
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA945116D0001
IDV Type: IDC
Timeline
Start Date: 2017-07-24
Current End Date: 2025-09-10
Potential End Date: 2025-09-10 00:00:00
Last Modified: 2025-09-09
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