DoD's $19.25M Hurricane Sweep R&D contract awarded to Southwest Research Institute raises value questions
Contract Overview
Contract Amount: $19,254,210 ($19.3M)
Contractor: Southwest Research Institute
Awarding Agency: Department of Defense
Start Date: 2019-02-19
End Date: 2024-02-26
Contract Duration: 1,833 days
Daily Burn Rate: $10.5K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: BUILDS, RESEARCH&DEVELOPMENT, TEST SUPPORT, AND INFRASTRUCTURE MODIFICATIONS IN SUPPORT OF THE HURRICANE SWEEP PROGRAM
Place of Performance
Location: SAN ANTONIO, BEXAR County, TEXAS, 78238
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $19.3 million to SOUTHWEST RESEARCH INSTITUTE for work described as: BUILDS, RESEARCH&DEVELOPMENT, TEST SUPPORT, AND INFRASTRUCTURE MODIFICATIONS IN SUPPORT OF THE HURRICANE SWEEP PROGRAM Key points: 1. Contract focuses on R&D for hurricane preparedness, a critical national security area. 2. Sole-source award to Southwest Research Institute suggests limited market research or unique capabilities. 3. Cost-plus-fixed-fee structure may incentivize cost overruns if not closely monitored. 4. Long contract duration of 1833 days warrants scrutiny of performance and evolving needs. 5. The specific NAICS code (541715) indicates a focus on physical and engineering sciences R&D. 6. Lack of competition raises concerns about achieving optimal pricing and innovation.
Value Assessment
Rating: questionable
The contract's value is difficult to assess without comparable sole-source R&D contracts. The cost-plus-fixed-fee (CPFF) pricing structure, while common for R&D, carries inherent risks of cost escalation if not rigorously managed. Benchmarking this specific R&D effort against similar government-funded projects in hurricane preparedness or related defense research would be necessary to determine if the $19.25 million represents a fair price for the services rendered. The absence of competition further complicates a direct value assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning the agency did not conduct a competitive procurement. This typically occurs when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The lack of competition means that potential cost savings and innovation that might arise from a bidding process were not realized. It is crucial to understand the justification for this sole-source award to ensure it was indeed necessary and that alternatives were thoroughly explored.
Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no competitive pressure to drive down prices. It also limits opportunities for other qualified businesses to secure government contracts.
Public Impact
The Department of Defense benefits from enhanced research and development capabilities for hurricane preparedness. Services delivered include research, development, test support, and infrastructure modifications. The program's geographic impact is likely focused on areas vulnerable to hurricanes, particularly within defense installations. Workforce implications may include specialized scientific and technical personnel employed by Southwest Research Institute.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competitive pricing and potential innovation.
- Cost-plus-fixed-fee structure can lead to cost overruns without strict oversight.
- Long contract duration may not align with rapidly evolving R&D needs.
- Lack of transparency in the sole-source justification could mask inefficiencies.
Positive Signals
- Southwest Research Institute is a reputable research organization with a history of government contracts.
- The contract addresses a critical national security need for hurricane preparedness.
- The CPFF structure allows for flexibility in R&D projects where scope may evolve.
- The contract duration allows for in-depth research and development.
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The market for defense-related R&D is substantial, with agencies like the Department of Defense investing heavily in advanced technologies and solutions. Comparable spending benchmarks would involve analyzing other sole-source or competitively awarded R&D contracts within defense agencies for similar scientific endeavors. The size of this contract, at over $19 million, places it as a significant investment in a specialized area.
Small Business Impact
There is no indication that this contract included small business set-asides. As a sole-source award to a large research institution, it is unlikely that significant subcontracting opportunities for small businesses were mandated or actively pursued within the scope of this specific award. This contract does not appear to directly impact the small business ecosystem in a positive manner through set-aside provisions.
Oversight & Accountability
Oversight for this contract would primarily reside with the Department of Defense and the Defense Threat Reduction Agency. As a Cost Plus Fixed Fee contract, rigorous financial oversight and performance monitoring are essential to ensure costs remain within budget and that deliverables meet objectives. The contract's duration suggests a need for ongoing reviews and potential modifications. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.
Related Government Programs
- Hurricane Preparedness Programs
- Defense Research and Development
- Infrastructure Modification Contracts
- Test and Evaluation Services
Risk Flags
- Sole-source award lacks competitive pricing.
- Cost-plus-fixed-fee structure poses risk of cost escalation.
- Long contract duration may not align with evolving R&D needs.
- Lack of transparency regarding sole-source justification.
Tags
department-of-defense, defense-threat-reduction-agency, research-and-development, sole-source, cost-plus-fixed-fee, hurricane-preparedness, southwest-research-institute, texas, delivery-order, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $19.3 million to SOUTHWEST RESEARCH INSTITUTE. BUILDS, RESEARCH&DEVELOPMENT, TEST SUPPORT, AND INFRASTRUCTURE MODIFICATIONS IN SUPPORT OF THE HURRICANE SWEEP PROGRAM
Who is the contractor on this award?
The obligated recipient is SOUTHWEST RESEARCH INSTITUTE.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Threat Reduction Agency).
What is the total obligated amount?
The obligated amount is $19.3 million.
What is the period of performance?
Start: 2019-02-19. End: 2024-02-26.
What specific justification was provided for awarding this contract on a sole-source basis to Southwest Research Institute?
The provided data does not include the specific justification for the sole-source award. Typically, sole-source procurements are justified under specific circumstances outlined in federal acquisition regulations, such as the existence of only one responsible source capable of providing the required services or supplies, or in situations of urgent and compelling need where competition is not feasible. For this contract, the agency (Department of Defense, specifically Defense Threat Reduction Agency) would have had to document why Southwest Research Institute was the only viable option. This could be due to unique expertise, proprietary technology, or specialized facilities required for the Hurricane Sweep Program's research and development objectives. Without access to the official justification document (e.g., a Justification and Approval or J&A), it is impossible to definitively state the reason, but it likely centers on unique capabilities.
How does the Cost Plus Fixed Fee (CPFF) structure compare to other R&D contract types in terms of risk and potential value for the government?
The Cost Plus Fixed Fee (CPFF) contract type is common for research and development (R&D) efforts where the scope of work is not precisely defined at the outset, allowing for flexibility as the project evolves. In a CPFF contract, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. For the government, the primary risk is cost overrun, as the contractor is incentivized to incur costs to perform the work, and the fixed fee remains constant regardless of the final cost. However, the fixed fee provides some cost certainty compared to other cost-reimbursement types like Cost Plus Incentive Fee (CPIF) or Cost Plus Award Fee (CPAF), where the fee can vary based on performance. The value for the government hinges on effective oversight to control costs and ensure the R&D objectives are met. Compared to Firm-Fixed-Price (FFP) contracts, CPFF offers more flexibility for R&D but less cost certainty.
What is the historical spending pattern for the Hurricane Sweep Program or similar R&D initiatives by the Defense Threat Reduction Agency?
The provided data focuses solely on this single contract awarded in 2019. To understand historical spending patterns for the Hurricane Sweep Program or similar R&D initiatives by the Defense Threat Reduction Agency (DTRA), a broader analysis of DTRA's contract database and budget allocations would be necessary. This would involve searching for previous contracts related to hurricane preparedness, disaster response R&D, or other relevant scientific research funded by DTRA. Examining DTRA's annual reports, budget requests, and contract award histories over several fiscal years would reveal trends in spending, the types of R&D prioritized, and the typical contract vehicles used. Without this broader context, it's difficult to ascertain if the $19.25 million award represents a typical investment or an outlier for such programs.
What are the key performance indicators (KPIs) used to measure the success of this R&D contract, and how has Southwest Research Institute performed against them?
The provided data does not specify the Key Performance Indicators (KPIs) for this contract, nor does it offer performance metrics or evaluation reports. For R&D contracts, KPIs often relate to achieving specific research milestones, successful testing of prototypes, development of new methodologies, or the successful transfer of technology. Performance against these KPIs would typically be documented in contract performance reports, progress reviews, and final acceptance documentation. Given the CPFF structure and the R&D nature, success might be measured by the successful completion of defined research phases and the delivery of actionable findings or prototypes relevant to the Hurricane Sweep Program's objectives. Without access to these performance records, an assessment of Southwest Research Institute's success is not possible from the given data.
Are there any known risks associated with Southwest Research Institute as a contractor, or with the specific technology/research area of hurricane preparedness R&D?
The provided data does not indicate any specific risks associated with Southwest Research Institute (SwRI) as a contractor. SwRI is a well-established independent research and development organization with extensive experience working with government agencies, including the Department of Defense. Their track record generally suggests a capacity to handle complex R&D projects. Regarding the research area, hurricane preparedness R&D inherently involves risks common to scientific exploration: the possibility of inconclusive results, the challenge of predicting complex natural phenomena, and the potential for research outcomes to become obsolete due to rapid advancements or changing environmental conditions. The CPFF contract structure is designed to accommodate some of these inherent R&D uncertainties. However, specific risks related to the 'Hurricane Sweep Program' itself would require more detailed information about the program's objectives and methodologies.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: HDTRA118R0004
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 6220 CULEBRA RD, SAN ANTONIO, TX, 78238
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: $23,880,583
Exercised Options: $19,510,937
Current Obligation: $19,254,210
Actual Outlays: $8,716,816
Subaward Activity
Number of Subawards: 14
Total Subaward Amount: $863,410
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HDTRA118D0002
IDV Type: IDC
Timeline
Start Date: 2019-02-19
Current End Date: 2024-02-26
Potential End Date: 2024-02-26 00:00:00
Last Modified: 2025-09-24
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