DoD's $52M R&D contract for flight scenario testing awarded to General Atomics without competition
Contract Overview
Contract Amount: $52,073,522 ($52.1M)
Contractor: General Atomics
Awarding Agency: Department of Defense
Start Date: 2017-09-12
End Date: 2020-06-12
Contract Duration: 1,004 days
Daily Burn Rate: $51.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: IGF::OT::IGF BASELINE TESTING FOR FLIGHT SCENARIOS
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92121
Plain-Language Summary
Department of Defense obligated $52.1 million to GENERAL ATOMICS for work described as: IGF::OT::IGF BASELINE TESTING FOR FLIGHT SCENARIOS Key points: 1. The contract's value of over $52 million for R&D services raises questions about cost-effectiveness given the lack of competitive bidding. 2. Sole-source awards can limit price discovery and potentially lead to higher costs for taxpayers. 3. The duration of the contract (over 1000 days) suggests a significant, long-term research effort. 4. The 'Research and Development in the Physical, Engineering, and Life Sciences' classification indicates a focus on advanced scientific and technical work. 5. The absence of small business set-aside flags suggests this contract was not specifically targeted to support small businesses. 6. The contract was awarded by the Department of Defense, a major federal spender in R&D.
Value Assessment
Rating: questionable
Benchmarking the value of this sole-source R&D contract is challenging without comparable competitive bids. The cost-plus-fixed-fee structure means the final cost could exceed initial estimates, depending on the contractor's efficiency. Without a competitive process, it's difficult to ascertain if the pricing reflects fair market value or if alternative, more cost-effective solutions were overlooked. The fixed fee component provides some cost control, but the overall value proposition is obscured by the lack of competition.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one contractor, General Atomics, was solicited. This approach bypasses the standard competitive bidding process, which typically involves multiple vendors submitting proposals. While sole-source awards can be justified in specific circumstances (e.g., unique capabilities, urgent needs), they limit the government's ability to explore a wider range of solutions and negotiate the best possible price.
Taxpayer Impact: Sole-source awards can result in higher prices for taxpayers as there is no competitive pressure to drive down costs. This limits the government's leverage in price negotiations and may mean less research funding is available for other critical needs.
Public Impact
The primary beneficiary is the Department of Defense, which receives advanced R&D services crucial for its operational capabilities. The contract supports the development and testing of flight scenarios, likely contributing to advancements in aerospace technology and defense systems. The geographic impact is centered in California, where General Atomics is based, potentially creating or sustaining high-skilled jobs in the region. The workforce implications involve specialized engineers, scientists, and technicians required for complex R&D projects.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition may lead to inflated costs.
- Sole-source awards reduce transparency and accountability in pricing.
- Potential for contractor lock-in due to specialized nature of R&D.
- Cost-plus-fixed-fee contracts can carry cost overrun risks if not managed tightly.
Positive Signals
- Contract awarded to a known entity in the defense sector (General Atomics).
- Focus on R&D suggests investment in future technological capabilities.
- Contract duration indicates a sustained effort towards a specific objective.
Sector Analysis
The contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. This is a critical area for the defense industry, driving innovation in areas like aerospace, materials science, and advanced computing. The market for defense R&D is characterized by significant government investment, long development cycles, and a reliance on specialized contractors with unique expertise. Comparable spending benchmarks in this sub-sector are often high due to the complexity and novelty of the research involved.
Small Business Impact
The 'sb' field is false, indicating this contract was not set aside for small businesses. Consequently, there are no direct subcontracting implications mandated for small businesses under this award. This means opportunities for small businesses to participate in this specific R&D effort are limited unless they are prime contractors or choose to subcontract independently.
Oversight & Accountability
Oversight for this contract would typically fall under the Defense Contract Management Agency (DCMA), which is responsible for ensuring compliance with contract terms and conditions. The cost-plus-fixed-fee structure necessitates close monitoring of expenditures to manage costs effectively. Transparency is limited due to the sole-source nature, but contract performance reports and financial reviews would be key accountability measures. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Defense Research and Development
- Aerospace Technology Development
- Advanced Engineering Services
- Flight Systems Research
- Department of Defense Contracts
Risk Flags
- Sole-source award
- Lack of competition
- Cost-plus-fixed-fee structure
Tags
defense, department-of-defense, general-atomics, research-and-development, r-and-d, cost-plus-fixed-fee, sole-source, california, definitive-contract, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $52.1 million to GENERAL ATOMICS. IGF::OT::IGF BASELINE TESTING FOR FLIGHT SCENARIOS
Who is the contractor on this award?
The obligated recipient is GENERAL ATOMICS.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $52.1 million.
What is the period of performance?
Start: 2017-09-12. End: 2020-06-12.
What is General Atomics' track record with sole-source R&D contracts from the DoD?
General Atomics has a long history of working with the Department of Defense, particularly in areas related to unmanned aerial systems and advanced defense technologies. While specific data on their sole-source R&D contract history requires deeper analysis, their established presence suggests a familiarity with the agency's requirements and processes. However, the lack of competition on this particular contract means that a comparative assessment of their performance against other potential bidders is not possible. Future analysis could involve examining the performance metrics and delivery outcomes of their previous sole-source awards to gauge efficiency and value.
How does the $52M value compare to similar R&D contracts in the defense sector?
The $52 million value for a sole-source R&D contract in the defense sector is substantial but not uncommon, especially for projects involving advanced technologies and long development timelines. The 'Research and Development in the Physical, Engineering, and Life Sciences' NAICS code covers a broad range of activities, and contract values can vary significantly. Without knowing the specific scope of 'flight scenario testing,' direct comparisons are difficult. However, major defense R&D programs often run into hundreds of millions or even billions of dollars. The key concern here is the lack of competition, which makes it harder to determine if this $52 million represents a competitive price for the services rendered, compared to what might have been achieved through a bidding process.
What are the primary risks associated with a sole-source award for R&D?
The primary risks associated with a sole-source award for R&D include potential overpricing due to the absence of competitive pressure, limited innovation stemming from a lack of diverse approaches, and reduced transparency in the procurement process. Taxpayers may not receive the best value for their investment. Furthermore, the government might become overly reliant on a single contractor, creating a potential 'lock-in' situation. For R&D specifically, the risk of pursuing a less optimal technical path or encountering unforeseen cost escalations is also higher without the scrutiny and alternative solutions that competition can provide.
How effective is the cost-plus-fixed-fee (CPFF) contract type for R&D projects like this?
The Cost-Plus-Fixed-Fee (CPFF) contract type is often used for R&D projects where the scope of work is not precisely defined at the outset, making it difficult to establish a firm fixed price. It aims to provide the contractor with cost reimbursement for allowable expenses while ensuring a fixed profit margin. This structure can incentivize contractors to control costs, as their fee is fixed regardless of the final project cost. However, it also carries risks: if the contractor's cost estimates are inaccurate or if unforeseen challenges arise, the total contract cost can escalate significantly beyond initial projections. Effective oversight is crucial to manage these risks and ensure value.
What is the historical spending pattern for R&D contracts awarded to General Atomics by the DoD?
Analyzing General Atomics' historical spending patterns with the DoD for R&D requires access to detailed contract databases. However, as a major defense contractor with significant expertise in areas like aerospace and unmanned systems, it is expected that General Atomics has received substantial funding for R&D initiatives over the years. The nature of R&D often involves multi-year, high-value contracts. Without specific historical data, it's difficult to pinpoint trends, but their consistent engagement suggests a strong, ongoing relationship with the DoD for developing advanced technologies. The sole-source nature of this specific contract warrants a review of whether similar R&D efforts have been competitively procured in the past.
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 › C – National Defense R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: HQ027717S0001
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 3550 GENERAL ATOMICS CT, SAN DIEGO, CA, 92121
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: $52,107,952
Exercised Options: $52,107,952
Current Obligation: $52,073,522
Actual Outlays: $746,881
Subaward Activity
Number of Subawards: 21
Total Subaward Amount: $296,407,694
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2017-09-12
Current End Date: 2020-06-12
Potential End Date: 2020-06-12 00:00:00
Last Modified: 2022-09-22
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