DoD's $23.8M R&D contract with SRC Inc. shows strong performance signals despite limited public data

Contract Overview

Contract Amount: $23,829,236 ($23.8M)

Contractor: SRC Inc

Awarding Agency: Department of Defense

Start Date: 2012-08-03

End Date: 2016-02-03

Contract Duration: 1,279 days

Daily Burn Rate: $18.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: CPFF BROAD AGENCY ANNOUNCEMENT AWARDED TO SRC INC.

Place of Performance

Location: SYRACUSE, ONONDAGA County, NEW YORK, 13212

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $23.8 million to SRC INC for work described as: CPFF BROAD AGENCY ANNOUNCEMENT AWARDED TO SRC INC. Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type (Cost Plus Fixed Fee) is common for R&D but can carry cost overrun risks. 3. SRC Inc. has a track record with the Department of Defense, indicating familiarity with agency needs. 4. The duration of the contract (1279 days) suggests a substantial and ongoing research effort. 5. The specific NAICS code points to research in physical, engineering, and life sciences, a critical area for defense innovation. 6. Limited publicly available performance metrics make a definitive value-for-money assessment challenging. 7. The contract was awarded in 2012, with performance concluding in 2016, providing historical context.

Value Assessment

Rating: fair

Assessing the value-for-money for this contract is difficult without detailed performance reports or cost breakdowns. The CPFF structure allows for cost reimbursement plus a fixed fee, which can incentivize contractors to control costs, but also carries the risk of cost overruns if not managed tightly. Benchmarking against similar R&D contracts in physical and engineering sciences would require access to more granular data on the specific research outcomes and the resources utilized. Given the award was made in 2012 and completed in 2016, current market rates may not be directly comparable.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit a bid. This typically suggests a robust bidding process where multiple companies had the opportunity to compete for the contract. The number of bidders is not specified, but the competitive nature of the award process is a positive indicator for price discovery and potentially achieving a fair market price.

Taxpayer Impact: A full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to better pricing and innovative solutions, reducing the likelihood of inflated costs.

Public Impact

The primary beneficiaries are likely the Department of Defense and its research arms, gaining insights and potential technological advancements in physical, engineering, and life sciences. The services delivered involve research and development activities, contributing to national security and technological superiority. The geographic impact is primarily within New York, where SRC Inc. is headquartered, though the research outcomes could have national implications. Workforce implications include employment for researchers, engineers, and support staff at SRC Inc. and potentially within the DoD's research facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed public performance metrics hinders a comprehensive assessment of the contract's success and value.
CPFF contracts can present risks of cost escalation if not rigorously monitored by the contracting agency.
The specific nature of the R&D is not detailed, making it hard to gauge the true innovation or impact.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that should have yielded fair pricing.
SRC Inc. is a known entity within the defense sector, implying a level of established capability and understanding of government contracting.
The contract duration suggests a significant and sustained research effort, potentially leading to valuable outcomes.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences, excluding biotechnology. This is a critical area for defense innovation, encompassing a wide range of scientific and technological advancements. The market for defense R&D is substantial, with significant government investment aimed at maintaining a technological edge. Comparable spending benchmarks would typically be found within broader DoD R&D budgets and specific research initiatives.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. This suggests that the primary contractor, SRC Inc., likely handled the majority of the work internally or with larger partners. The impact on the small business ecosystem is therefore minimal for this specific award, as it did not leverage small business set-aside provisions.

Oversight & Accountability

Oversight for this contract would have been managed by the Department of the Army, a component of the Department of Defense. As a Cost Plus Fixed Fee contract, rigorous oversight of expenditures and progress would be expected to ensure compliance with the contract terms and prevent cost overruns. Transparency is limited by the nature of R&D contracts, which often involve proprietary information. Inspector General jurisdiction would apply for any investigations into fraud, waste, or abuse.

Related Government Programs

Department of Defense Research and Development Programs
Army Research Laboratory Contracts
Physical Sciences Research Contracts
Engineering Sciences Research Contracts
Life Sciences Research Contracts

Risk Flags

Lack of detailed performance metrics
Potential for cost overruns in CPFF contracts
Limited transparency on specific R&D outcomes

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.8 million to SRC INC. CPFF BROAD AGENCY ANNOUNCEMENT AWARDED TO SRC INC.

Who is the contractor on this award?

The obligated recipient is SRC INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $23.8 million.

What is the period of performance?

Start: 2012-08-03. End: 2016-02-03.

What was the specific research conducted under this contract, and what were its key outcomes?

The provided data indicates the contract was for 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)' under NAICS code 541712. However, the specific research topics, methodologies, and tangible outcomes are not detailed in the award information. Contracts of this nature often involve foundational research, prototype development, or feasibility studies. Without access to the contract's statement of work, technical reports, or final deliverables, it is impossible to specify the exact research conducted or its key outcomes. Such details are typically considered sensitive or proprietary, especially in defense R&D, and are not always made public.

How does the awarded amount of approximately $23.8 million compare to typical R&D contracts in this field?

The $23.8 million award for R&D in physical, engineering, and life sciences is a substantial but not extraordinary amount for a multi-year defense research contract. The typical range for such contracts can vary widely depending on the scope, complexity, and duration. Larger, more complex programs can easily exceed hundreds of millions of dollars, while smaller, more focused research efforts might be in the single-digit millions. This contract, awarded in 2012 and lasting over three years, falls within a common bracket for significant R&D initiatives aimed at exploring new technologies or advancing existing ones for defense applications. Benchmarking requires comparing it to contracts with similar objectives, durations, and performing agencies.

What is SRC Inc.'s track record with the Department of Defense, particularly in R&D?

SRC Inc. has a history of contracting with the Department of Defense. While this specific award is for approximately $23.8 million, a review of federal procurement data would likely reveal numerous other contracts awarded to SRC Inc. by various DoD components over the years. Their presence in the defense sector suggests they possess the necessary clearances, infrastructure, and expertise to handle government contracts, including those involving sensitive research and development. Their continued awards indicate a level of satisfaction or capability recognized by the DoD, though specific performance details on past contracts would be needed for a comprehensive assessment.

What are the potential risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D?

Cost Plus Fixed Fee (CPFF) contracts are common in R&D where the scope may evolve or be difficult to define precisely upfront. The primary risk for the government is that the contractor may not be sufficiently incentivized to control costs, as all allowable costs are reimbursed. While a fixed fee provides some incentive, if costs escalate significantly, the total contract value can increase substantially. For the contractor, the risk lies in accurately estimating costs to ensure the fixed fee is profitable. Effective government oversight is crucial to monitor expenditures, ensure compliance, and manage potential cost overruns throughout the contract's lifecycle.

How does the 'full and open competition' award mechanism impact the value for taxpayers?

Awarding a contract through 'full and open competition' generally benefits taxpayers by fostering a competitive environment. This process allows any responsible source to submit a bid, increasing the pool of potential offerors and encouraging competitive pricing. When multiple companies vie for a contract, they are incentivized to offer their best prices and most innovative solutions to win the award. This competitive pressure can lead to lower overall costs for the government compared to sole-source or limited competition scenarios, thereby maximizing the value of taxpayer dollars spent on goods and services.

What is the significance of the NAICS code 541712 in the context of this contract?

NAICS code 541712, 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology),' signifies that the contract's objective was to advance scientific knowledge and develop new technologies within these broad scientific domains. This includes fields like materials science, aerospace engineering, mechanical engineering, environmental science, and various medical research areas (excluding biotech). For the Department of Defense, R&D in these areas is crucial for developing next-generation military capabilities, improving existing systems, and understanding emerging threats. The specific application could range from developing new materials for equipment to advancing sensor technology or improving operational effectiveness.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 7502 ROUND POND RD, NORTH SYRACUSE, NY, 13212

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: $23,829,236

Exercised Options: $23,829,236

Current Obligation: $23,829,236

Subaward Activity

Number of Subawards: 8

Total Subaward Amount: $5,918,261

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline