Department of Defense awards $471.8M contract to The MITRE Corporation for R&D support, extending performance through FY16

Contract Overview

Contract Amount: $471,786,934 ($471.8M)

Contractor: THE Mitre Corporation

Awarding Agency: Department of Defense

Start Date: 2015-10-01

End Date: 2017-09-30

Contract Duration: 730 days

Daily Burn Rate: $646.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: R&D

Official Description: IGF::OT::IGF THE PURPOSE OF THIS CONTRACT IS TO REFLECT THE FOLLOWING: 1. IN ACCORDANCE WITH DFARS 704.7001(C)(1), ADMINISTRATIVE CONTRACT NUMBER W56KGU-15-C-0010 HAS BEEN CREATED AND IS ASSOCIATED WITH BASE YEAR CONTRACT W15P7T-13-C-A802 FOR THE SOLE PURPOSE OF COLLECTING AND TRACKING FY 16 PROJECTS, FUNDING, AND EXPENDITURES IN OPTION YEAR TWO. 2. THE PERIOD OF PERFORMANCE FOR OPTION YEAR TWO IS FROM 01 OCTOBER 2015 TO 30 SEPTEMBER 2016. 3. ALL TERMS AND CONDITIONS OF CONTRACT W15P7T-13-C-A802 ARE IN FULL FORCE AND EFFECT ON CONTRACT W56KGU-15-C-0010. 4. FUNDING IS PROVIDED IN ACCORDANCE WITH FAR 52.232-22, "LIMITATION OF FUNDS" FOR THE PROJECTS SET FORTH IN SECTION B. 5. INCORPORATE THE OPTION YEAR #2 FY16 CONTRACT SECURITY CLASSIFICATION SPECIFICATION (DD FORM 254) THAT IDENTIFIES A COMPLETE LISTING OF ACCESS THAT IS REQUIRED UNDER CONTRACT W56KGU-15-C-0010, IN ACCORDANCE WITH FAR 52.204-2 "SECURITY REQUIREMENT CLAUSE." EACH PROJECT WILL BE ISSUED AN INDIVIDUAL DD FORM 254. SECURITY CLASSIFICATION GUIDANCE CONTAINED IN EACH INDIVIDUAL DD FORM 254 WILL BE SPECIFIC TO THE PROJECT CONCERNED, CITE APPLICABLE SECURITY CLASSIFICATION GUIDES AND COMPLY WITH THE NEED-TO-KNOW PRINCIPLE AS DEFINED IN THE NISPOM. WHERE NO GUIDE IS AVAILABLE, THE PROJECT OFFICE WILL PREPARE ONE TO IDENTIFY INFORMATION ELEMENTS THAT ARE CLASSIFIED. DOD 5220.22M NATIONAL INDUSTRIAL SECURITY OPERATING MANUAL (NISPOM), 28 MARCH 2013 AND ALL ITS SUPPLEMENTS APPLY TO ALL CLASSIFIED CONTRACT PERFORMANCE. SEE SECTION J. 6. INCORPORATE FY16 DD FORM 254 SECURITY CLASSIFICATION SPECIFICATION IN ACCORDANCE WITH FAR 52.204-2 "SECURITY REQUIREMENT CLAUSE" AND FOR THE FOLLOWING PROJECTS. SEE SECTION J. A210, A230, A300, B100, D070, D310, D350, P040, S230, V140, V240, V270, V500, V590, V600 7. INCORPORATE FY16 PERFORMANCE WORK STATEMENT (PWS) IN ACCORDANCE WITH FAR 52.243-2 "CHANGES-COST REIMBURSEMENT" FOR THE FOLLOWING PROJECTS. SEE SECTION J. A210 (AMD 01), A230 (AMD 03), A300 (AMD 05), B100, D070, D310 (AMD 02), D350, P040 (AMD 06), S230 (AMD 05), V140 (AMD 08), V240, V270 (AMD 01), V500 (AMD 06), V590, V600 8. THE FOLLOWING IS THE FUNDING SUMMARY FOR FY 2016: TOTAL ALLOCATED CEILING: W56KGU-15-C-0010 ALLOCATIONS: $368,900,000.00 PRIOR OBLIGATED CEILING FUNDS: $ 0.00 FUNDS THIS ACTION: $ 11,383,388.00 TOTAL OBLIGATED CEILING FUNDS: $ 11,383,388.00 NON-CEILING OBLIGATED FUNDS: $ 0.00 NON-CEILING FUNDS THIS ACTION: $ 2,500,272.00 TOTAL NON-CEILING FUNDS: $ 2,500,272.00 PRIOR FUNDS ALLOCATED $ 0.00 TOTAL FUNDS THIS ACTION: $ 13,883,660.00 TOTAL FUNDS ALLOCATED: $ 13,883,660.00 TOTAL OBLIGATED CEILING FUNDS: $ 11,383,388.00 TOTAL OBLIGATED NON-CEILING FUNDS: $ 2,500,272.00 TOTAL OBLIGATED FUNDS: $ 13,883,660.00 9. ALL OTHER TERMS AND CONDITIONS REMAIN THE SAME.

Place of Performance

Location: MC LEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $471.8 million to THE MITRE CORPORATION for work described as: IGF::OT::IGF THE PURPOSE OF THIS CONTRACT IS TO REFLECT THE FOLLOWING: 1. IN ACCORDANCE WITH DFARS 704.7001(C)(1), ADMINISTRATIVE CONTRACT NUMBER W56KGU-15-C-0010 HAS BEEN CREATED AND IS ASSOCIATED WITH BASE YEAR CONTRACT W15P7T-13-C-A802 FOR THE SOLE PURPOSE OF COLLECTING AND TR… Key points: 1. Contract primarily serves as an administrative vehicle to track FY16 projects and expenditures. 2. Performance period extends to September 30, 2016, indicating ongoing support needs. 3. The contract type is 'Cost No Fee', suggesting a focus on research and development where final costs may be less predictable. 4. This award is a continuation of a previous base year contract, indicating a stable, long-term relationship. 5. The contract is associated with 'Research and Development in the Physical, Engineering, and Life Sciences', a critical sector for innovation.

Value Assessment

Rating: fair

The contract value of $471.8 million over two years (implied by the 730-day duration and the FY16 focus) for R&D support is substantial. As a 'Cost No Fee' contract, the government bears the cost of performance, with the contractor receiving no fee. This structure is common in R&D where outcomes are uncertain. Benchmarking value is difficult without specific deliverables, but the administrative nature suggests it's a mechanism for managing existing R&D efforts rather than procuring a new, defined service.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was explicitly noted as 'NOT COMPETED'. This indicates that the Department of the Army, through the Department of Defense, likely awarded this contract on a sole-source basis. Such awards typically occur when a specific contractor possesses unique capabilities, is the only source capable of meeting requirements, or in situations where competition is not feasible or practical, such as follow-on work to an existing contract.

Taxpayer Impact: Sole-source awards can limit price discovery and potentially lead to higher costs for taxpayers compared to a competitively bid contract. However, if the contractor is essential for specific R&D, the value may outweigh the lack of competition.

Public Impact

The primary beneficiaries are likely research institutions and personnel involved in the physical, engineering, and life sciences. Services delivered include administrative support for tracking and managing R&D projects and expenditures. The geographic impact is likely concentrated around the contractor's facilities and any research sites funded under this contract. Workforce implications include continued employment for researchers, scientists, and administrative staff supporting these R&D efforts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing or suboptimal resource allocation.
The administrative nature of the award means direct R&D outcomes are not explicitly detailed, making performance assessment challenging.
Reliance on a sole-source award could indicate a lack of market readiness or a gap in available alternative providers for these specific R&D needs.

Positive Signals

The contract represents continued investment in critical R&D areas for national security or technological advancement.
The MITRE Corporation is a well-established entity with a long history of supporting government R&D, suggesting a degree of reliability.
The administrative structure allows for flexibility in managing diverse R&D projects under a single umbrella.

Sector Analysis

This contract falls under the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The Department of Defense is a major investor in R&D to maintain technological superiority. The total federal spending on R&D is in the hundreds of billions annually, with a significant portion allocated to defense-related research. This contract, valued at over $471 million, represents a substantial investment within this category, likely supporting advanced scientific and technological initiatives.

Small Business Impact

The data indicates this contract was not competed and does not specify any small business set-aside provisions. The primary contractor, The MITRE Corporation, is a large, federally funded research and development center (FFRDC). There is no direct indication of subcontracting opportunities for small businesses within this specific award, though MITRE may engage in such practices more broadly.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army and the Department of Defense. As a 'Cost No Fee' contract, financial oversight is crucial to ensure funds are expended appropriately for authorized R&D activities. Transparency is limited by the sole-source nature and administrative focus; detailed project-specific oversight would depend on internal DoD mechanisms and potentially Inspector General reviews if specific concerns arise.

Related Government Programs

Department of Defense Research and Development Programs
Army R&D Initiatives
Federally Funded Research and Development Centers (FFRDCs)
Science and Technology Development Contracts

Risk Flags

Sole-source award limits competition.
Cost-reimbursement nature requires strong financial oversight.
Administrative purpose may obscure direct R&D performance metrics.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $471.8 million to THE MITRE CORPORATION. IGF::OT::IGF THE PURPOSE OF THIS CONTRACT IS TO REFLECT THE FOLLOWING: 1. IN ACCORDANCE WITH DFARS 704.7001(C)(1), ADMINISTRATIVE CONTRACT NUMBER W56KGU-15-C-0010 HAS BEEN CREATED AND IS ASSOCIATED WITH BASE YEAR CONTRACT W15P7T-13-C-A802 FOR THE SOLE PURPOSE OF COLLECTING AND TRACKING FY 16 PROJECTS, FUNDING, AND EXPENDITURES IN OPTION YEAR TWO. 2. THE PERIOD OF PERFORMANCE FOR OPTION YEAR TWO IS FROM 01 OCTOBER 2015 TO 30 SEPTEMBER 2016. 3. ALL TERMS AND CONDITIONS OF CONTRACT W15P7T-13-C-A802

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 $471.8 million.

What is the period of performance?

Start: 2015-10-01. End: 2017-09-30.

What is the specific nature of the R&D projects funded under this contract?

The provided data indicates this contract (W56KGU-15-C-0010) is primarily an administrative vehicle to track funding and expenditures for FY16 projects under a base contract (W15P7T-13-C-A802). While the North American Industry Classification System (NAICS) code 541712 points to 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)', the specific projects are not detailed in this award notice. The 'Cost No Fee' (CNF) contract type suggests that the government is funding the direct costs of research and development activities performed by The MITRE Corporation, but the contractor does not receive a profit or fee. This often implies a focus on foundational research, exploratory development, or projects where the final outcomes and costs are highly uncertain, making it difficult to establish a fixed price or incentive structure.

How does the $471.8 million value compare to similar R&D contracts awarded by the Department of Defense?

The $471.8 million value for a two-year period (October 2015 - September 2017, encompassing FY16) is substantial for a single R&D contract. The Department of Defense awards numerous large R&D contracts annually, often in the tens or hundreds of millions of dollars, particularly for advanced technology development, weapon systems research, and scientific exploration. However, direct comparisons are challenging without knowing the specific R&D domain (e.g., AI, cybersecurity, materials science, aerospace). The MITRE Corporation, as a Federally Funded Research and Development Center (FFRDC), often manages large, complex, and long-term research portfolios. This contract's value is significant but falls within the expected range for major R&D investments by the DoD, especially considering its administrative function for tracking multiple projects.

What are the key risks associated with a sole-source 'Cost No Fee' R&D contract of this magnitude?

The primary risks associated with this sole-source 'Cost No Fee' R&D contract are threefold. Firstly, the sole-source nature inherently limits competition, potentially leading to less favorable pricing than a competitively bid contract and reducing the government's leverage in negotiations. Secondly, the 'Cost No Fee' structure, while suitable for uncertain R&D, shifts the financial risk entirely to the government; the contractor is reimbursed for allowable costs but has no direct financial incentive to control them beyond contractual obligations. This could lead to cost overruns if not meticulously managed. Thirdly, the administrative purpose of tracking projects means the contract itself may not directly incentivize specific R&D breakthroughs, relying instead on the underlying projects for tangible outcomes. Effective oversight and robust cost accounting are critical to mitigate these risks.

What is The MITRE Corporation's track record with the Department of Defense, particularly in R&D administration?

The MITRE Corporation has an extensive and long-standing track record of supporting the Department of Defense (DoD) and other federal agencies across a wide spectrum of research, development, and systems engineering activities. As a prominent Federally Funded Research and Development Center (FFRDC), MITRE is specifically chartered to provide objective, independent research and analysis to the government. They manage numerous complex programs and provide technical guidance, systems engineering, and strategic planning support. Their involvement in administering and tracking R&D funding, as indicated by this contract, is consistent with their role in helping the DoD manage its vast R&D portfolio, ensuring alignment with strategic goals and facilitating the efficient allocation of resources across various scientific and technological domains.

How does this contract fit into the broader landscape of federal R&D spending?

This contract represents a component of the broader federal R&D spending, which is a critical investment area for national security, economic competitiveness, and scientific advancement. The Department of Defense is consistently one of the largest federal funders of R&D. Contracts like this, even if administrative, are essential for the effective management and execution of research initiatives. The NAICS code 541712 signifies a focus on fundamental and applied research in physical and engineering sciences, areas crucial for defense modernization. The value of $471.8 million underscores the significant resources dedicated to maintaining a technological edge. This contract's administrative function highlights the importance of robust program management and financial tracking within the complex ecosystem of federal R&D investments.

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 › OTHER RESEARCH/DEVELOPMENT

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: $471,786,934

Exercised Options: $471,786,934

Current Obligation: $471,786,934

Actual Outlays: $-1,839

Subaward Activity

Number of Subawards: 49

Total Subaward Amount: $7,444,241

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline