DoD's $416M Integrated Sensor IS contract with Lockheed Martin shows R&D spending concerns
Contract Overview
Contract Amount: $416,177,905 ($416.2M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2009-04-23
End Date: 2015-03-31
Contract Duration: 2,168 days
Daily Burn Rate: $192.0K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: INTEGRATED SENSOR IS STRUCTURE (ISIS)
Place of Performance
Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93599
Plain-Language Summary
Department of Defense obligated $416.2 million to LOCKHEED MARTIN CORPORATION for work described as: INTEGRATED SENSOR IS STRUCTURE (ISIS) Key points: 1. High contract value ($416M) for R&D. 2. Sole contractor (Lockheed Martin) raises competition questions. 3. Cost Plus Fixed Fee (CPFF) contract type can lead to cost overruns. 4. Research and Development sector spending is often complex to benchmark.
Value Assessment
Rating: questionable
The $416M contract value for R&D is substantial. Benchmarking CPFF contracts in the R&D sector is challenging due to unique project scopes and evolving requirements. Without specific comparable contracts, assessing value for money is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Although advertised as full and open, the award went to a single entity, Lockheed Martin. This suggests potential issues in the bidding process or a lack of competitive proposals received, impacting price discovery.
Taxpayer Impact: The significant investment in R&D requires careful oversight to ensure taxpayer funds are used effectively and lead to valuable technological advancements.
Public Impact
Significant taxpayer investment in advanced defense technology. Potential for groundbreaking sensor technology development. Contract duration of nearly 6 years indicates a long-term R&D effort.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type
- Sole awardee despite full and open competition
- High total contract value
Positive Signals
- Focus on critical R&D for national security
- Potential for technological innovation
Sector Analysis
This contract falls within the Research and Development sector, specifically for physical, engineering, and life sciences. Spending in this area is characterized by high uncertainty and long development cycles, making direct cost comparisons difficult.
Small Business Impact
The contract was awarded to Lockheed Martin Corporation, a large defense contractor. There is no indication of small business participation in this specific contract award, which is common for large-scale R&D projects.
Oversight & Accountability
The contract's duration and cost-plus nature necessitate robust oversight from the Defense Advanced Research Projects Agency (DARPA) to monitor progress, control costs, and ensure alignment with research objectives.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
- Department of Defense Contracting
- Defense Advanced Research Projects Agency Programs
Risk Flags
- High contract value
- Cost Plus Fixed Fee contract type
- Sole awardee despite full and open competition
- Long contract duration
Tags
research-and-development-in-the-physical, department-of-defense, ca, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $416.2 million to LOCKHEED MARTIN CORPORATION. INTEGRATED SENSOR IS STRUCTURE (ISIS)
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Advanced Research Projects Agency).
What is the total obligated amount?
The obligated amount is $416.2 million.
What is the period of performance?
Start: 2009-04-23. End: 2015-03-31.
What specific technological advancements were achieved through this $416M R&D investment?
Detailed information on specific technological advancements is often classified or proprietary for R&D contracts of this nature. However, the goal of the Integrated Sensor IS program was likely to develop next-generation sensing capabilities for defense applications, potentially enhancing intelligence, surveillance, and reconnaissance.
How did the agency ensure fair pricing and prevent cost overruns with a Cost Plus Fixed Fee contract for R&D?
Agencies typically use detailed cost proposals, independent cost estimates, and ongoing monitoring of contractor performance and expenditures to manage CPFF contracts. For R&D, the fixed fee is negotiated based on anticipated effort and risk, with oversight focused on achieving milestones and managing scope creep.
What is the long-term strategic value of the Integrated Sensor IS technology developed under this contract?
The long-term strategic value lies in its potential to provide a significant military advantage through enhanced situational awareness and target identification. Successful development could lead to improved operational effectiveness, reduced risk to personnel, and a stronger national defense posture.
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
Solicitation Procedures: BASIC RESEARCH
Offers Received: 2
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 1011 LOCKHEED WAY, PALMDALE, CA, 93599
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $431,511,246
Exercised Options: $431,511,246
Current Obligation: $416,177,905
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2009-04-23
Current End Date: 2015-03-31
Potential End Date: 2015-03-31 00:00:00
Last Modified: 2019-01-04
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