DARPA's ELECTRA "ARGOS" contract awarded to BAE Systems for $44.9M, focusing on R&D

Contract Overview

Contract Amount: $44,904,844 ($44.9M)

Contractor: BAE Systems Information & Electronic Systems Integration Inc

Awarding Agency: Department of Defense

Start Date: 2020-04-07

End Date: 2026-06-30

Contract Duration: 2,275 days

Daily Burn Rate: $19.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: DARPA ELECTRA "ARGOS" BASE + IT PHASE 1

Place of Performance

Location: MERRIMACK, HILLSBOROUGH County, NEW HAMPSHIRE, 03054

State: New Hampshire Government Spending

Plain-Language Summary

Department of Defense obligated $44.9 million to BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION INC for work described as: DARPA ELECTRA "ARGOS" BASE + IT PHASE 1 Key points: 1. Contract value of $44.9 million for research and development. 2. BAE Systems Information & Electronic Systems Integration Inc. is the prime contractor. 3. The contract is a Cost Plus Fixed Fee type, indicating shared risk and reward. 4. Performance period spans over 6 years, from April 2020 to June 2026. 5. This award falls under the Research and Development in Physical, Engineering, and Life Sciences NAICS code. 6. The contract was awarded under Full and Open Competition after Exclusion of Sources. 7. The contract is a Definitive Contract, suggesting a long-term agreement for services. 8. The award is associated with the Department of the Navy within the Department of Defense.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without more granular data on the scope of work and deliverables. However, the Cost Plus Fixed Fee structure suggests a negotiated fee based on estimated costs, which can sometimes lead to higher overall costs compared to fixed-price contracts if cost overruns occur. The duration of over six years for an R&D project is substantial, and the total value of $44.9 million needs to be assessed against the complexity and novelty of the research objectives.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition after Exclusion of Sources.' This specific designation implies that while the competition was intended to be open, certain sources were excluded for reasons not fully detailed in the provided data. This could suggest a specialized requirement or a pre-existing relationship that limited the pool of eligible bidders. The exact number of bidders is not specified, making it difficult to fully assess the intensity of the competition.

Taxpayer Impact: The limited competition may mean that taxpayers did not benefit from the lowest possible price that a broader, more competitive bidding process might have yielded.

Public Impact

This contract supports advanced research and development initiatives within the Department of Defense, potentially leading to technological advancements. The primary beneficiaries are likely the Department of Defense and its operational capabilities, through the development of new technologies. The research conducted could have implications for national security and technological superiority. The contract supports specialized scientific and engineering workforce within BAE Systems and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'Exclusion of Sources' in the competition type raises questions about the breadth of competition and potential missed opportunities for cost savings.
Cost Plus Fixed Fee contracts can carry a risk of cost overruns if not managed meticulously.
The long performance period (over 6 years) for an R&D contract requires continuous oversight to ensure progress and relevance.

Positive Signals

Award to a large, established defense contractor like BAE Systems suggests a capacity for complex R&D projects.
The Definitive Contract award indicates a commitment to a specific research area over an extended period.
The contract is for Research and Development, aligning with DARPA's mission to foster innovation.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences. The R&D market within the defense industry is characterized by significant investment in innovation to maintain technological superiority. Comparable spending benchmarks would typically involve analyzing other large-scale R&D contracts awarded by agencies like DARPA, DoD, or other federal research bodies for similar scientific endeavors. The market size for defense R&D is substantial, driven by evolving geopolitical landscapes and the need for cutting-edge capabilities.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a large contract awarded to a major defense contractor, it is unlikely to have significant direct subcontracting opportunities specifically targeted at small businesses unless BAE Systems voluntarily includes them in its subcontracting plan. The focus on specialized R&D may also limit the types of small businesses that could participate.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy and DARPA. As a Cost Plus Fixed Fee contract, rigorous financial oversight is crucial to monitor costs and ensure the fixed fee remains appropriate. Accountability measures would be tied to the research milestones and deliverables outlined in the contract. Transparency might be limited due to the sensitive nature of defense R&D, but reporting requirements would be established. Inspector General jurisdiction would apply for any investigations into fraud, waste, or abuse.

Related Government Programs

DARPA Research Programs
Department of Defense R&D Contracts
BAE Systems Defense Contracts
Navy Research and Development Initiatives
Advanced Technology Development Contracts

Risk Flags

Competition Exclusion
Cost Plus Fixed Fee Risk
Long-term R&D Uncertainty

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.9 million to BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION INC. DARPA ELECTRA "ARGOS" BASE + IT PHASE 1

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $44.9 million.

What is the period of performance?

Start: 2020-04-07. End: 2026-06-30.

What specific technological advancements is DARPA's ELECTRA "ARGOS" program aiming to achieve?

The provided data does not specify the exact technological advancements targeted by DARPA's ELECTRA "ARGOS" program. However, given that it falls under the NAICS code 541715 (Research and Development in the Physical, Engineering, and Life Sciences), the program likely focuses on developing novel capabilities in areas such as advanced materials, complex systems engineering, artificial intelligence, robotics, or other cutting-edge scientific fields relevant to national security. DARPA's mission is to make pivotal investments in breakthrough technologies for national security, so the "ARGOS" program is expected to push the boundaries of current scientific understanding and engineering capabilities to address future defense challenges.

How does the Cost Plus Fixed Fee (CPFF) contract structure compare to other contract types in terms of cost efficiency for R&D?

Cost Plus Fixed Fee (CPFF) contracts are common for research and development where the scope of work is not precisely defined at the outset, making fixed-price contracts impractical. In a CPFF contract, the contractor is reimbursed for all allowable costs plus a fixed fee representing profit. This structure incentivizes the contractor to control costs to maximize their profit margin, as the fee is fixed regardless of the final cost. However, compared to fixed-price contracts, CPFF can potentially lead to higher overall costs if the initial cost estimates are inaccurate or if significant cost overruns occur, as the government bears the risk of cost escalation. For highly uncertain R&D, it offers flexibility but requires robust government oversight to manage costs effectively.

What are the potential risks associated with a six-year R&D contract like this?

A six-year R&D contract presents several potential risks. Firstly, technological obsolescence is a significant concern; the technology being developed might be surpassed by advancements elsewhere before the contract concludes. Secondly, the research objectives themselves might prove unachievable or less valuable than initially anticipated, leading to wasted investment. Thirdly, contractor performance can degrade over long periods, or key personnel might leave, impacting progress. Finally, the cost estimates underpinning the 'fixed fee' could become misaligned with actual expenditures over such an extended duration, potentially leading to cost overruns or a fee that is disproportionate to the effort expended. Continuous monitoring and adaptive management are crucial to mitigate these risks.

What does 'Full and Open Competition after Exclusion of Sources' imply for the bidding process and taxpayer value?

The term 'Full and Open Competition after Exclusion of Sources' suggests a complex bidding scenario. It implies that the initial solicitation was intended to be open to all responsible sources. However, specific sources were subsequently excluded. The reasons for exclusion are not detailed but could stem from national security concerns, proprietary technology, or specific capabilities required that only a limited number of entities possess. While it aims for competition, the exclusion inherently narrows the field. For taxpayer value, this means that while competition occurred, it might not have been as broad as possible, potentially limiting the downward pressure on prices that a wider competition could exert. The justification for the exclusion would be critical in assessing if this approach truly served the government's best interests.

How does this contract's value compare to other large-scale R&D efforts within the Department of Defense?

The $44.9 million value of this contract positions it as a significant, but not exceptionally large, R&D investment within the Department of Defense. Major defense R&D programs, particularly those involving major system development or advanced research initiatives, can often reach hundreds of millions or even billions of dollars. For instance, contracts for developing new aircraft, missile systems, or advanced cyber capabilities frequently exceed this amount. This contract appears to be focused on a specific research area under DARPA, which often funds high-risk, high-reward projects that may not require the same scale of funding as full-scale system development. Therefore, its value is substantial for its specific R&D scope but modest compared to the largest defense acquisition programs.

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: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: ALTERNATIVE SOURCES

Solicitation ID: HR001119S0055

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Ball Corporation

Address: 144 DANIEL WEBSTER HWY #24, MERRIMACK, NH, 03054

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $44,913,994

Exercised Options: $44,913,994

Current Obligation: $44,904,844

Actual Outlays: $16,983,458

Subaward Activity

Number of Subawards: 35

Total Subaward Amount: $9,202,396

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline