GSA's $39.5M R&D contract with AI Signal Research Inc. shows fair value despite limited competition

Contract Overview

Contract Amount: $39,493,895 ($39.5M)

Contractor: AI Signal Research Inc

Awarding Agency: General Services Administration

Start Date: 2015-01-01

End Date: 2017-12-31

Contract Duration: 1,095 days

Daily Burn Rate: $36.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 9

Pricing Type: FIRM FIXED PRICE

Sector: R&D

Official Description: ENGINGEERING AND TEST SUPPORT SERVICES - IGF::OT::IGF

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35801

State: Alabama Government Spending

Plain-Language Summary

General Services Administration obligated $39.5 million to AI SIGNAL RESEARCH INC for work described as: ENGINGEERING AND TEST SUPPORT SERVICES - IGF::OT::IGF Key points: 1. Contract value of $39.5M over three years suggests a moderate annual spend for specialized R&D services. 2. The contract was awarded under full and open competition after exclusion of sources, indicating a potentially competitive process. 3. A fixed-price contract type helps mitigate cost overrun risks for the government. 4. The R&D focus in physical, engineering, and life sciences (NAICS 541712) aligns with critical government research needs. 5. The contract's duration of 1095 days (3 years) is standard for complex R&D projects. 6. The award to AI Signal Research Inc. represents a single contractor's contribution to a specific R&D domain.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or comparable R&D service contracts. However, the total award of $39.5 million over three years averages approximately $13.2 million annually. This figure appears reasonable for specialized engineering and test support services within the R&D sector, especially considering the fixed-price nature of the contract which shifts some risk to the contractor. Further analysis would require understanding the specific deliverables and the complexity of the research conducted.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This indicates that while the competition was intended to be broad, specific sources may have been excluded based on predefined criteria. The number of bidders (9) suggests a moderate level of interest, which is generally positive for price discovery. However, the 'exclusion of sources' clause warrants further investigation to understand its potential impact on the breadth of competition and final pricing.

Taxpayer Impact: A competitive process, even with exclusions, generally benefits taxpayers by encouraging multiple vendors to offer competitive bids, potentially leading to better pricing and service quality.

Public Impact

The primary beneficiaries are likely government agencies requiring specialized engineering and test support for research and development initiatives. The contract delivers critical R&D services in physical, engineering, and life sciences, contributing to technological advancement. The geographic impact is primarily linked to the contractor's location in Alabama (AL), though the services may support national R&D goals. Workforce implications include employment opportunities for scientists, engineers, and technicians at AI Signal Research Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited transparency due to 'exclusion of sources' clause in competition.
Lack of detailed performance metrics makes value-for-money assessment difficult.
Concentration of R&D spending with a single contractor could limit broader market engagement.

Positive Signals

Fixed-price contract type provides cost certainty for the government.
Award under a competitive process, even with exclusions, suggests an effort to obtain fair value.
Contract duration of three years allows for sustained support on complex R&D projects.

Sector Analysis

This contract falls within the Research and Development in the Physical, Engineering, and Life Sciences sector (NAICS 541712). This is a critical sector for government innovation, supporting advancements in defense, technology, and scientific discovery. The market for such specialized services is often characterized by a mix of large, established research institutions and smaller, niche firms like AI Signal Research Inc. Annual federal spending in R&D services can fluctuate significantly based on national priorities, but typically represents a substantial portion of the federal budget dedicated to innovation and future capabilities.

Small Business Impact

The contract data indicates that small business participation (sb: false) and set-asides (ss: false) were not primary considerations for this specific award. This suggests the contract was not specifically targeted towards small businesses, and AI Signal Research Inc. is likely not classified as a small business for this contract. Consequently, there are no direct subcontracting implications for small businesses arising from this award, nor a direct boost to the small business ecosystem through this particular contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the General Services Administration (GSA), Federal Acquisition Service. Accountability measures are inherent in the fixed-price contract type, requiring the contractor to deliver specified services within the agreed budget. Transparency is facilitated through contract award databases, though detailed performance reports may not always be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

Research and Development Services
Engineering Support Services
Test and Evaluation Services
Federal Acquisition Service Contracts
General Services Administration Contracts

Risk Flags

Competition level may be impacted by 'exclusion of sources' clause.
Lack of detailed performance metrics hinders comprehensive value assessment.
Contractor's specific expertise and track record for this niche R&D area require further validation.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $39.5 million to AI SIGNAL RESEARCH INC. ENGINGEERING AND TEST SUPPORT SERVICES - IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is AI SIGNAL RESEARCH INC.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $39.5 million.

What is the period of performance?

Start: 2015-01-01. End: 2017-12-31.

What is the track record of AI Signal Research Inc. in securing and performing federal R&D contracts?

AI Signal Research Inc. has secured federal contracts primarily within the R&D and engineering services domain. While this specific contract with GSA is for $39.5 million, a comprehensive review of their contract history would involve examining awards across various agencies and contract types. Key performance indicators such as past performance ratings, on-time delivery, and adherence to technical specifications on previous contracts are crucial for assessing their reliability. A deeper dive into federal procurement databases like SAM.gov or FPDS would reveal the extent of their federal footprint, including contract values, agencies served, and any reported performance issues or commendations. Understanding their historical success rate in competitive bidding and their ability to meet complex R&D requirements is vital for evaluating future engagements.

How does the $39.5 million contract value compare to similar R&D support services awarded by the GSA or other agencies?

The $39.5 million contract value for engineering and test support services over three years, averaging approximately $13.2 million annually, places it in the mid-tier range for specialized R&D contracts. Comparable contracts within the physical, engineering, and life sciences sector can vary widely based on scope, duration, and the specific expertise required. For instance, larger, multi-year contracts for advanced scientific research or major system development could easily exceed $100 million. Conversely, smaller, targeted research projects might be valued in the low millions. Benchmarking against contracts with similar NAICS codes (541712) and contract types (Firm Fixed Price) awarded by agencies like DoD, NASA, or NSF would provide a more precise comparison. Without access to detailed performance and deliverable information for this specific contract, a definitive value-for-money assessment relative to peers remains challenging.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this contract include potential scope creep, technical challenges in R&D, and contractor performance issues. Scope creep is mitigated by the Firm Fixed Price (FFP) contract type, which incentivizes the contractor to adhere to the defined scope to maintain profitability. Technical challenges are inherent in R&D; mitigation relies on the contractor's expertise and the government's clear definition of objectives and milestones. Contractor performance risk is managed through standard contract oversight, performance monitoring, and the potential for contract termination for default if deliverables are not met. The 'Full and Open Competition After Exclusion of Sources' also introduces a risk of not achieving the broadest possible competition, potentially impacting price and innovation, which is partially addressed by the nine bidders participating.

How effective is the 'Full and Open Competition After Exclusion of Sources' approach in ensuring fair pricing and quality for R&D services?

The 'Full and Open Competition After Exclusion of Sources' approach aims to balance broad competition with specific requirements that might necessitate excluding certain types of vendors. While 'full and open' suggests an intent for wide participation, the 'exclusion of sources' clause means that not all potential offerors were considered. This can be effective if the exclusions are justified by technical requirements, security needs, or specific capabilities that only a subset of the market possesses. It can lead to fair pricing and quality if the remaining pool of bidders is sufficiently competitive. However, if the exclusions are overly broad or not well-justified, it could limit competition, potentially leading to higher prices or reduced innovation compared to truly unrestricted full and open competition. The fact that nine bids were received suggests a reasonable level of competition was maintained.

What is the historical spending pattern for engineering and test support services by the GSA's Federal Acquisition Service?

Analyzing the historical spending patterns of the GSA's Federal Acquisition Service (FAS) for engineering and test support services requires examining contract data over multiple fiscal years. FAS, through its various schedules and contract vehicles, procures a wide range of services, including R&D and technical support. Spending in this area can fluctuate based on agency needs, technological shifts, and overall federal budget allocations. A review of past FAS procurements would reveal trends in contract values, types of services procured, and the primary contractors involved. Understanding these patterns helps contextualize the $39.5 million award, indicating whether it represents a typical, increased, or decreased level of investment in such services by FAS during the contract period (2015-2017).

What are the implications of the NAICS code 541712 (Research and Development in the Physical, Engineering, and Life Sciences) for this contract's scope and potential impact?

The classification under NAICS code 541712 signifies that the contract's scope is focused on systematic study to gain new knowledge in the physical, engineering, and life sciences, excluding biotechnology. This broad category encompasses a vast array of research activities, from materials science and aerospace engineering to environmental studies and medical research (excluding direct biotech applications). Contracts under this code often involve complex problem-solving, experimentation, and the development of new technologies or scientific understanding. The potential impact is significant, as advancements in these fields can lead to national security improvements, economic growth, and enhanced quality of life. The specific impact depends heavily on the precise research objectives and outcomes defined within the contract.

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 › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: ID04140134

Offers Received: 9

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2001 NICHOLS DR STE 300, HUNTSVILLE, AL, 35802

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $86,286,985

Exercised Options: $52,671,031

Current Obligation: $39,493,895

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q14OADS741

IDV Type: IDC

Timeline