JHU Applied Physics Lab receives $104.8M for missile defense R&D, awarded via sole-source contract
Contract Overview
Contract Amount: $104,864,152 ($104.9M)
Contractor: THE Johns Hopkins University Applied Physics Laboratory LLC
Awarding Agency: Department of Defense
Start Date: 2018-04-27
End Date: 2026-03-31
Contract Duration: 2,895 days
Daily Burn Rate: $36.2K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: ENGINEERING AND TECH SUPPORT RDTE FUNDS IGF::OT::IGF
Place of Performance
Location: LAUREL, HOWARD County, MARYLAND, 20723
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $104.9 million to THE JOHNS HOPKINS UNIVERSITY APPLIED PHYSICS LABORATORY LLC for work described as: ENGINEERING AND TECH SUPPORT RDTE FUNDS IGF::OT::IGF Key points: 1. Contract awarded to a single entity suggests limited market exploration for potential cost savings. 2. Research and Development focus indicates investment in future capabilities rather than immediate service delivery. 3. Long contract duration (2018-2026) implies a sustained need for specialized technical expertise. 4. Cost-plus-fixed-fee structure may incentivize cost incurrence, requiring robust oversight. 5. Missile Defense Agency's reliance on this contractor points to unique or highly specialized capabilities. 6. No small business set-aside indicates the primary contractor is not a small business, with potential subcontracting opportunities.
Value Assessment
Rating: fair
Benchmarking the value of this contract is challenging without comparable sole-source R&D awards. The cost-plus-fixed-fee (CPFF) pricing structure, while common for R&D, can lead to higher costs if not managed effectively. The fixed fee component provides some predictability, but the overall cost is subject to the direct costs incurred by the contractor. Without competition, it's difficult to ascertain if the pricing represents optimal value for the government.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning the Missile Defense Agency did not solicit bids from multiple potential contractors. This approach is typically used when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The lack of competition limits price discovery and may result in higher costs compared to a competitively awarded contract.
Taxpayer Impact: Sole-source awards mean taxpayers do not benefit from the cost reductions typically achieved through competitive bidding, potentially leading to a higher overall expenditure for the government.
Public Impact
The primary beneficiary is the Department of Defense, specifically the Missile Defense Agency, which gains access to advanced research and development. Services delivered include research, development, testing, and evaluation (RDTE) related to missile defense systems. The geographic impact is primarily within Maryland, where The Johns Hopkins University Applied Physics Laboratory LLC is located. Workforce implications include the employment of highly skilled scientists, engineers, and technical personnel at the contractor's facility.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee structure requires diligent oversight to manage direct costs effectively.
- Sole-source award limits opportunities for competitive pricing and potential cost savings.
- Long-term nature of the contract necessitates ongoing performance monitoring to ensure continued value.
Positive Signals
- Award to a well-established research institution like JHU APL suggests a high level of technical expertise.
- Focus on RDTE indicates a commitment to advancing critical national security capabilities.
- The contract's duration suggests a stable and predictable need for these specialized services.
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The Missile Defense Agency operates in a highly specialized segment of the defense industry, characterized by long development cycles, significant technological innovation, and substantial government investment. Comparable spending benchmarks in this niche are difficult to establish due to the unique nature of missile defense technologies and the limited number of entities with the requisite expertise.
Small Business Impact
The contract was not competed and did not include a small business set-aside. This indicates that the primary focus was on securing specialized R&D capabilities from a large, established institution. There may be opportunities for small businesses to participate as subcontractors, but this is not guaranteed and depends on the prime contractor's subcontracting plan. The absence of a set-aside means small businesses did not have a direct opportunity to compete for the prime contract.
Oversight & Accountability
Oversight for this contract would typically be managed by the Missile Defense Agency's contracting and program management offices. Given the sole-source and cost-plus-fixed-fee nature, robust oversight is crucial to monitor expenditures, ensure progress against research objectives, and verify the allowability and allocability of costs. Transparency is facilitated through contract reporting requirements, but detailed public access to R&D specifics may be limited due to national security considerations. Inspector General jurisdiction would apply to audits and investigations of fraud, waste, or abuse.
Related Government Programs
- Missile Defense Systems
- Advanced Research Projects Agency (ARPA) Funding
- Department of Defense Research and Development
- Strategic Defense Initiatives
Risk Flags
- Sole-source award may limit price competition.
- Cost-plus-fixed-fee structure requires diligent cost oversight.
- Long contract duration necessitates sustained performance monitoring.
Tags
research-and-development, missile-defense-agency, department-of-defense, sole-source, cost-plus-fixed-fee, university-affiliated-research-center, maryland, long-term-contract, rdte, national-security
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $104.9 million to THE JOHNS HOPKINS UNIVERSITY APPLIED PHYSICS LABORATORY LLC. ENGINEERING AND TECH SUPPORT RDTE FUNDS IGF::OT::IGF
Who is the contractor on this award?
The obligated recipient is THE JOHNS HOPKINS UNIVERSITY APPLIED PHYSICS LABORATORY LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Missile Defense Agency).
What is the total obligated amount?
The obligated amount is $104.9 million.
What is the period of performance?
Start: 2018-04-27. End: 2026-03-31.
What is the historical spending trend for missile defense R&D at the Missile Defense Agency?
Historical spending on missile defense R&D by the Missile Defense Agency (MDA) has been substantial, reflecting the ongoing need to counter evolving threats. While specific figures fluctuate annually based on program priorities and budget allocations, the MDA consistently represents a significant portion of the Department of Defense's R&D budget. Analyzing past MDA budget requests and contract awards reveals a pattern of sustained investment in areas such as interceptor technology, sensor development, and system integration. This particular contract, awarded in 2018 with an estimated value of $104.8 million, aligns with this historical trend of significant, long-term R&D funding for critical missile defense capabilities. The agency's overall budget has historically ranged in the billions of dollars, with a notable portion dedicated to research and development efforts.
How does the cost-plus-fixed-fee (CPFF) structure compare to other contract types for R&D, and what are the implications for value?
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, making it difficult to establish a firm fixed price. In a CPFF contract, the contractor is reimbursed for allowable costs incurred, plus a predetermined fixed fee representing profit. This structure incentivizes the contractor to control costs, as the fee remains constant regardless of the final cost. However, compared to fixed-price contracts, CPFF can lead to higher overall costs for the government if cost overruns occur, as the government bears the risk of actual expenses. For R&D, it offers flexibility but requires stringent oversight to ensure costs are reasonable and allocable to the contract objectives. Other R&D contract types include Cost-Plus-Incentive-Fee (CPIF), which adds performance incentives, and Firm-Fixed-Price (FFP) contracts, used when R&D scope is highly predictable, offering better price certainty but less flexibility.
What is the track record of The Johns Hopkins University Applied Physics Laboratory LLC in performing government R&D contracts?
The Johns Hopkins University Applied Physics Laboratory LLC (JHU APL) has a long and distinguished track record of performing complex research and development (R&D) for the U.S. government, particularly within the Department of Defense and intelligence community. JHU APL is a University Affiliated Research Center (UARC), a designation that signifies a unique relationship with the government, often involving direct federal funding and a focus on national security missions. They are known for their expertise in areas such as strategic systems, space science, national health, and advanced computing. Their history includes significant contributions to major defense programs, including missile defense, undersea warfare, and cybersecurity. Government performance evaluations and contract histories generally reflect a high level of technical competence and successful delivery on challenging R&D objectives. Their UARC status often implies a level of trust and established capability that facilitates sole-source or limited-competition awards for critical national security R&D.
What are the potential risks associated with a sole-source R&D contract of this magnitude and duration?
Sole-source R&D contracts of this magnitude and duration carry several potential risks. Firstly, the lack of competition can lead to suboptimal pricing, as the government does not benefit from the cost-saving pressures inherent in a competitive bidding process. This could result in the government paying more than necessary for the research and development services. Secondly, there's a risk of contractor complacency; without the threat of losing future business to competitors, the contractor might be less motivated to innovate aggressively or optimize efficiency. Thirdly, a sole-source award can create vendor lock-in, making it difficult and costly to transition to a different contractor or technology in the future, especially if the contractor develops proprietary knowledge or unique infrastructure. Finally, for long-duration contracts, there's the risk that the contractor's capabilities or focus may drift from the evolving needs of the agency, requiring significant management effort to keep the R&D aligned with current strategic objectives.
How does the Missile Defense Agency ensure accountability and performance on long-term, sole-source R&D contracts?
The Missile Defense Agency (MDA) employs several mechanisms to ensure accountability and performance on long-term, sole-source R&D contracts like this one. Given the CPFF structure and sole-source nature, robust oversight is paramount. This includes establishing clear performance metrics, milestones, and deliverables within the contract. Regular program reviews, technical interchange meetings, and progress reports are conducted to monitor progress, identify challenges, and ensure alignment with agency goals. The fixed fee component provides a baseline incentive, but the MDA also utilizes contract clauses that allow for adjustments or termination if performance is unsatisfactory. For sole-source contracts, the agency often relies on the contractor's established reputation and past performance, but still conducts rigorous technical evaluations. Audits by the Defense Contract Audit Agency (DCAA) and the Inspector General's office help ensure the allowability, allocability, and reasonableness of costs. Ultimately, strong program management and proactive engagement are key to holding the contractor accountable.
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 › C – National Defense R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: HQ014717R0041
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 11100 JOHNS HOPKINS RD, LAUREL, MD, 20723
Business Categories: Category Business, Limited Liability Corporation, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $116,569,797
Exercised Options: $116,569,797
Current Obligation: $104,864,152
Actual Outlays: $4,150,317
Subaward Activity
Number of Subawards: 17
Total Subaward Amount: $3,035,977
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HQ014718D0004
IDV Type: IDC
Timeline
Start Date: 2018-04-27
Current End Date: 2026-03-31
Potential End Date: 2026-03-31 00:00:00
Last Modified: 2025-12-09
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