Department of Defense awards $436.5M to MITRE Corporation for engineering services, with $2.96M incrementally funded

Contract Overview

Contract Amount: $436,539,036 ($436.5M)

Contractor: THE Mitre Corporation

Awarding Agency: Department of Defense

Start Date: 2012-10-01

End Date: 2014-03-31

Contract Duration: 546 days

Daily Burn Rate: $799.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Other

Official Description: MITRE FFRDC CONTRACT- ADMINISTRATIVE CONTRACT NUMBER FOR YEAR FIVE OF THE FIVE YEAR OPTION. INCREMENTAL FUNDING IN THE AMOUNT OF $2,958,376.00, DD 254 AND PERFORMANCE WORK STATEMENT AMENDMENTS.

Place of Performance

Location: MC LEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $436.5 million to THE MITRE CORPORATION for work described as: MITRE FFRDC CONTRACT- ADMINISTRATIVE CONTRACT NUMBER FOR YEAR FIVE OF THE FIVE YEAR OPTION. INCREMENTAL FUNDING IN THE AMOUNT OF $2,958,376.00, DD 254 AND PERFORMANCE WORK STATEMENT AMENDMENTS. Key points: 1. Contract awarded to a single entity, raising questions about competitive pricing. 2. Long-term contract suggests a strategic partnership, potentially indicating specialized needs. 3. Incremental funding approach allows for flexibility but requires ongoing monitoring. 4. Performance work statement amendments indicate evolving requirements. 5. The contract's value places it among significant federal engineering service awards. 6. Focus on administrative functions for an FFRDC highlights support infrastructure needs.

Value Assessment

Rating: good

The total value of $436.5 million over five years for engineering services to the MITRE Corporation appears reasonable given its role as a Federally Funded Research and Development Center (FFRDC). While direct comparisons are difficult due to the unique nature of FFRDCs, the cost-plus-no-fee structure suggests that the government is not paying for profit, but rather for the direct costs incurred by MITRE. The incremental funding of $2.96 million for administrative contract adjustments is a small fraction of the total award, indicating stable underlying performance.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to The MITRE Corporation. As an FFRDC, MITRE is specifically chartered to provide objective, in-depth analysis and research to the government. Sole-source awards are common for FFRDCs due to their unique capabilities and established relationship with the government, ensuring continuity of critical research and development support.

Taxpayer Impact: Sole-source awards for FFRDCs like MITRE mean taxpayers benefit from specialized, objective expertise that might not be readily available through competitive bidding, ensuring long-term strategic advantage.

Public Impact

The Department of Defense, specifically the Department of the Army, benefits from specialized engineering and administrative support. Services provided are critical for the ongoing operations and strategic planning of defense initiatives. The contract supports the functioning of a key FFRDC, which in turn supports numerous government agencies. Workforce implications are primarily within the highly skilled technical and administrative staff at The MITRE Corporation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition could lead to less aggressive pricing over the contract's life.
Sole-source nature requires robust government oversight to ensure continued value.
Incremental funding, while common, necessitates careful tracking of expenditures.

Positive Signals

MITRE's status as an FFRDC implies a high level of trust and proven capability.
Cost-plus-no-fee structure aligns costs with actual expenses, minimizing profit motive.
Long-term nature of the contract suggests stable, ongoing support for critical defense needs.

Sector Analysis

This contract falls within the Engineering Services sector, a broad category encompassing a wide range of technical and advisory services. The federal government is a significant consumer of these services, particularly within defense and research. MITRE, as an FFRDC, operates in a specialized niche focused on national security and scientific advancement, often undertaking complex, long-term projects that require deep technical expertise and objective analysis. Benchmarking is challenging due to the unique FFRDC model, but the scale of this award reflects the critical nature of the services provided to the Department of Defense.

Small Business Impact

This contract does not appear to have a small business set-aside component, nor is there explicit information regarding subcontracting opportunities for small businesses. As a sole-source award to a large FFRDC, the primary focus is on MITRE's direct capabilities. Future analysis could explore if MITRE engages small businesses as subcontractors for specific support functions.

Oversight & Accountability

Oversight for this contract is managed by the Department of the Army. As a sole-source award to an FFRDC, oversight likely focuses on performance against the Statement of Work, adherence to budget, and ensuring the objective, independent nature of MITRE's analysis. Transparency is generally high for FFRDC contracts, with regular reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

MITRE FFRDC Contracts
Department of Defense Engineering Services
Federally Funded Research and Development Centers (FFRDCs)
Administrative Support Contracts
Cost-Plus-No-Fee Contracts

Risk Flags

Sole-source award lacks competitive pricing pressure.
Long-term contract duration requires sustained oversight.
Incremental funding necessitates careful budget management and tracking.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $436.5 million to THE MITRE CORPORATION. MITRE FFRDC CONTRACT- ADMINISTRATIVE CONTRACT NUMBER FOR YEAR FIVE OF THE FIVE YEAR OPTION. INCREMENTAL FUNDING IN THE AMOUNT OF $2,958,376.00, DD 254 AND PERFORMANCE WORK STATEMENT AMENDMENTS.

Who is the contractor on this award?

The obligated recipient is THE MITRE CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $436.5 million.

What is the period of performance?

Start: 2012-10-01. End: 2014-03-31.

What is the historical spending trend for The MITRE Corporation with the Department of Defense?

The provided data indicates a definitive contract valued at $436,539,035.83 with an award date of October 1, 2012, and an end date of March 31, 2014, spanning 546 days. This specific contract represents a significant investment by the Department of Defense in MITRE's engineering and administrative services. To understand the broader historical trend, one would need to examine prior and subsequent contracts awarded to MITRE by the DoD. FFRDCs like MITRE often receive multi-year, sole-source awards due to their specialized nature and established relationship with the government. Analyzing the total obligated amounts, contract types, and duration of all contracts awarded to MITRE by the DoD over the past decade would reveal patterns of consistent, long-term support, potentially showing an increasing or stable level of funding depending on evolving national security needs and research priorities.

How does the value of this contract compare to other engineering services contracts awarded by the Department of Defense?

This contract, with a total value of approximately $436.5 million, is substantial within the realm of engineering services. The Department of Defense procures a vast array of engineering support, ranging from individual project-based consulting to large-scale, long-term research and development initiatives. Contracts for FFRDCs like MITRE are often among the largest due to the breadth and depth of their mission. While many engineering contracts might be in the millions or tens of millions, awards in the hundreds of millions are typically reserved for critical, long-term strategic partnerships or major system development support. Comparing this to other sole-source FFRDC contracts would show it is in the upper tier, reflecting the significant role MITRE plays in supporting national defense objectives through its unique analytical and engineering capabilities.

What are the primary risks associated with a sole-source contract of this magnitude?

The primary risk associated with a sole-source contract of this magnitude is the potential for reduced price competition, which could lead to less favorable pricing than if the contract were competed. Without multiple bidders vying for the work, there is less inherent pressure on the contractor to offer the most cost-effective solutions. Another risk is contractor complacency; a sole-source provider might be less incentivized to innovate or improve efficiency compared to a contractor facing competitive pressures. Furthermore, reliance on a single source can create vulnerability if the contractor experiences significant performance issues, financial instability, or strategic shifts that impact their ability to deliver. Robust government oversight, clear performance metrics, and regular re-evaluation of the necessity for a sole-source arrangement are crucial to mitigate these risks.

What is the significance of MITRE being a Federally Funded Research and Development Center (FFRDC) in the context of this contract?

MITRE's designation as an FFRDC is highly significant for this contract. FFRDCs are unique entities established to meet specific long-term research and development needs of the government that cannot be effectively met by the private sector or government laboratories alone. They operate in the public interest, providing objective, independent analysis and technical support. This designation allows for sole-source contracting because FFRDCs possess specialized knowledge, facilities, and a trusted relationship with their sponsoring agencies. For the Department of Defense, contracting with MITRE as an FFRDC ensures access to high-level expertise in areas critical to national security, fostering innovation and providing unbiased insights for complex defense challenges. The 'Cost No Fee' structure further emphasizes the FFRDC's mission-oriented, non-profit nature.

What does the incremental funding of $2,958,376.00 signify for contract management?

The incremental funding of $2,958,376.00 signifies that only a portion of the total contract value has been obligated at the time of this award or modification. This is a common practice, especially for multi-year contracts, allowing agencies to manage their budgets year by year and commit funds only as they become available or as specific phases of work are approved. For contract management, it means that while the total potential value is $436.5 million, the immediate financial commitment is much lower. This approach provides flexibility but requires diligent tracking of the overall contract ceiling and the cumulative funding obligated. It also necessitates careful planning and justification for subsequent funding increments to ensure the project remains aligned with strategic goals and budget realities throughout its lifecycle.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Address: 7515 COLSHIRE DR, MC LEAN, VA, 22102

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: $436,539,036

Exercised Options: $436,539,036

Current Obligation: $436,539,036

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline