DoD's $44.2M TDES contract for PZ Trainer development shows significant investment in specialized equipment

Contract Overview

Contract Amount: $44,217,901 ($44.2M)

Contractor: Scientific Research Corporation

Awarding Agency: Department of Defense

Start Date: 2018-07-11

End Date: 2023-07-10

Contract Duration: 1,825 days

Daily Burn Rate: $24.2K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: DEVELOPMENT LABOR AND MATERIAL. THIS ORDER UNDER THE THREAT DEVELOPMENT AND EVENT SUPPORT (TDES) CONTRACT IS FOR THE PZ TRAINER REQUIREMENT AND INCLUDES FUNDING FOR LABOR, MATERIAL, OTHER DIRECT COSTS AND TRAVEL.

Place of Performance

Location: ATLANTA, COBB County, GEORGIA, 30339

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $44.2 million to SCIENTIFIC RESEARCH CORPORATION for work described as: DEVELOPMENT LABOR AND MATERIAL. THIS ORDER UNDER THE THREAT DEVELOPMENT AND EVENT SUPPORT (TDES) CONTRACT IS FOR THE PZ TRAINER REQUIREMENT AND INCLUDES FUNDING FOR LABOR, MATERIAL, OTHER DIRECT COSTS AND TRAVEL. Key points: 1. Contract awarded as a delivery order under an existing TDES contract, indicating a continuation or expansion of services. 2. The contract's firm-fixed-price structure aims to control costs for the development of specialized training equipment. 3. Focus on 'Development Labor and Material' suggests a significant portion of the award is for direct creation and resources. 4. The duration of 1825 days (5 years) points to a long-term need for the PZ Trainer requirement. 5. Awarded to Scientific Research Corporation, a contractor with existing ties to the TDES vehicle. 6. The contract is not competed, raising questions about potential cost efficiencies and market-driven pricing. 7. Geographic location of the contractor in Georgia may have implications for local economic impact and workforce.

Value Assessment

Rating: fair

Benchmarking the value of this specific delivery order is challenging without comparable data for PZ Trainers. The firm-fixed-price structure provides cost certainty for the government. However, the lack of competition means there's no direct market comparison to assess if the pricing is optimal. The total award amount of over $44 million for a 5-year development effort suggests a complex and resource-intensive requirement.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a delivery order under the existing Threat Development and Event Support (TDES) contract, which was likely competed previously. However, this specific order was not competed. This approach can streamline acquisition for follow-on requirements but limits opportunities for new vendors and potentially reduces price competition.

Taxpayer Impact: The lack of direct competition for this delivery order means taxpayers may not benefit from the most competitive pricing that could have been achieved through an open bidding process.

Public Impact

The primary beneficiaries are likely military personnel who will utilize the PZ Trainer for training purposes, enhancing readiness and operational effectiveness. The services delivered include the development of specialized training equipment, encompassing labor, materials, and travel. The geographic impact is primarily centered in Georgia, where Scientific Research Corporation is located, potentially creating or sustaining jobs in the region. Workforce implications include the need for skilled labor in development, engineering, and material sourcing for the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition for this specific delivery order limits price discovery and potential cost savings for taxpayers.
Reliance on a sole-source award under an existing contract may stifle innovation from other market participants.
The significant dollar value of the award warrants close monitoring of performance and cost execution.

Positive Signals

Awarding under an existing TDES contract likely leverages established processes and contractor relationships, potentially speeding up delivery.
The firm-fixed-price contract type provides cost certainty to the government, mitigating budget risks.
The long duration suggests a sustained commitment to a critical training capability.

Sector Analysis

This contract falls within the broader defense sector, specifically focusing on the development of training and simulation equipment. The market for such specialized defense systems is often characterized by a limited number of highly capable contractors. The TDES contract vehicle itself represents a mechanism for procuring a range of threat development and event support services, and this award is a specific application within that framework. Comparable spending benchmarks would typically be found within other defense training and simulation procurements.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements mentioned. As a sole-source delivery order under a larger contract, the direct impact on the small business ecosystem is likely minimal unless Scientific Research Corporation actively engages small businesses in its supply chain for this specific effort.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. As a delivery order under an existing contract, the TDES contract likely has established oversight mechanisms. Transparency is generally facilitated through contract award databases, though detailed performance metrics may not be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Threat Development and Event Support (TDES) Contract
Defense Training and Simulation Systems
Military Equipment Development
Specialized Training Solutions

Risk Flags

Sole-source award
Lack of direct competition
Long-term development effort

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.2 million to SCIENTIFIC RESEARCH CORPORATION. DEVELOPMENT LABOR AND MATERIAL. THIS ORDER UNDER THE THREAT DEVELOPMENT AND EVENT SUPPORT (TDES) CONTRACT IS FOR THE PZ TRAINER REQUIREMENT AND INCLUDES FUNDING FOR LABOR, MATERIAL, OTHER DIRECT COSTS AND TRAVEL.

Who is the contractor on this award?

The obligated recipient is SCIENTIFIC RESEARCH 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 $44.2 million.

What is the period of performance?

Start: 2018-07-11. End: 2023-07-10.

What is the specific nature of the 'PZ Trainer' requirement and its intended use within the Department of Defense?

The 'PZ Trainer' requirement, as indicated by the contract description, pertains to the development of specialized training equipment. While the exact acronym 'PZ' is not explicitly defined in the provided data, such trainers are typically designed to simulate specific scenarios, platforms, or threats that military personnel need to practice with. This could range from flight simulators for aircraft to tactical engagement simulators for ground troops or even specialized equipment for testing and evaluation. The contract's focus on 'Development Labor and Material' suggests a significant engineering and manufacturing effort is involved in creating this system from the ground up or substantially modifying existing designs. The ultimate goal is to enhance training realism, improve skill acquisition, and increase the overall readiness of military forces by providing a safe and cost-effective training environment.

How does the firm-fixed-price (FFP) contract type benefit the government in this context?

The firm-fixed-price (FFP) contract type is highly beneficial for the government in this scenario because it shifts the majority of the cost risk to the contractor, Scientific Research Corporation. Under an FFP agreement, the contractor is obligated to complete the work for a predetermined price, regardless of their actual costs incurred. This provides the Department of the Army with significant budget certainty for the $44.2 million award. It incentivizes the contractor to manage their resources efficiently and control costs to maximize their profit margin. For a development effort involving labor and materials over a five-year period, FFP helps prevent cost overruns that could occur with cost-reimbursement contracts, making financial planning more predictable.

What are the potential risks associated with awarding this delivery order on a sole-source basis?

Awarding this delivery order on a sole-source basis, even if under an existing contract vehicle, carries several potential risks. Firstly, the government may not achieve the most competitive pricing, as there is no direct comparison from multiple bidders vying for the work. This could lead to paying a premium for the development and materials. Secondly, it limits the opportunity for other capable contractors to demonstrate their expertise and potentially offer innovative solutions or more cost-effective approaches. This can stifle competition within the market segment over the long term. Lastly, without the pressure of competition, there's a potential for reduced urgency or focus on efficiency from the awarded contractor, although the FFP structure does provide some incentive for cost control.

Can the value of this contract be benchmarked against similar defense training equipment development efforts?

Benchmarking the value of this $44.2 million contract for the PZ Trainer development against similar defense training equipment efforts is challenging without more specific details about the trainer's capabilities and complexity. Defense training systems vary widely in cost based on factors like fidelity, simulation scope (e.g., individual vs. collective training), platform integration, and technological sophistication. While $44.2 million over five years for development might seem substantial, it could represent excellent value if the PZ Trainer is a highly advanced, multi-functional system critical for advanced combat training. Conversely, if it's a simpler simulation, the cost might be higher than comparable systems. Publicly available data on specific training system development costs is often limited due to security and proprietary concerns, making direct comparisons difficult.

What is the track record of Scientific Research Corporation in delivering complex defense development contracts?

Scientific Research Corporation (SRC) has a significant track record in developing and delivering complex systems for the Department of Defense and other government agencies. They are known for their work in areas such as command, control, communications, computers, and intelligence (C4I) systems, electronic warfare, and advanced sensor technologies. SRC often participates in large, multi-year development contracts, including those awarded under various indefinite-delivery/indefinite-quantity (IDIQ) vehicles, similar to the TDES contract under which this delivery order was issued. Their history suggests they possess the technical expertise and program management capabilities required for such endeavors. However, the specific performance history related to the TDES contract and the PZ Trainer requirement would need further investigation to provide a complete picture.

How does the 5-year duration (1825 days) impact the overall assessment of this contract?

The 5-year duration (1825 days) for the PZ Trainer development contract indicates a long-term commitment by the Department of the Army to acquiring this capability. This extended timeline suggests that the development process is complex, requiring significant research, design, prototyping, testing, and refinement. It also implies that the PZ Trainer is intended to be a critical component of training infrastructure for an extended period. From an assessment perspective, the long duration necessitates robust program management and oversight to ensure milestones are met, costs remain controlled, and the final product aligns with evolving military requirements. It also means that potential risks associated with technology obsolescence or changing operational needs must be carefully managed throughout the contract's life.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Other Commercial and Service Industry Machinery Manufacturing

Product/Service Code: TRAINING AIDS AND DEVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W900KK17R0002

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2300 WINDY RIDGE PKWY STE 400S, ATLANTA, GA, 30339

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

Financial Breakdown

Contract Ceiling: $47,561,302

Exercised Options: $47,561,302

Current Obligation: $44,217,901

Subaward Activity

Number of Subawards: 38

Total Subaward Amount: $32,679,927

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W900KK17D0010

IDV Type: IDC

Timeline