Over $10.8 million awarded to Michigan State University for R&D facilities, spanning over a decade

Contract Overview

Contract Amount: $10,836,293 ($10.8M)

Contractor: Michigan State University

Awarding Agency: Department of Health and Human Services

Start Date: 2003-09-29

End Date: 2015-08-05

Contract Duration: 4,328 days

Daily Burn Rate: $2.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 16

Pricing Type: COST NO FEE

Sector: R&D

Official Description: RESEARCH AND DEVELOPMENT FACILITIES

Place of Performance

Location: EAST LANSING, INGHAM County, MICHIGAN, 48824

State: Michigan Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $10.8 million to MICHIGAN STATE UNIVERSITY for work described as: RESEARCH AND DEVELOPMENT FACILITIES Key points: 1. Significant long-term investment in research infrastructure. 2. Contract awarded through full and open competition. 3. Potential for long-term scientific advancement and innovation. 4. Performance period extended significantly beyond initial award. 5. Focus on physical, engineering, and life sciences research. 6. Geographic concentration of spending in Michigan.

Value Assessment

Rating: fair

The contract awarded to Michigan State University for research and development facilities represents a substantial, long-term investment. While specific value-for-money metrics are not provided, the duration of the contract (over 12 years) suggests a sustained need for these facilities. Benchmarking against similar R&D facility contracts is challenging without more granular data on the scope and nature of the facilities. The cost-plus-fixed-fee (CPFF) or cost-no-fee (CNF) structure, common in R&D, can sometimes lead to less price sensitivity compared to fixed-price contracts, warranting careful oversight.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to compete. This process is generally expected to yield competitive pricing and a wider selection of qualified contractors. The presence of 16 bids suggests a robust competitive environment for this particular requirement.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down costs and encouraging innovation among potential awardees.

Public Impact

Benefits Michigan State University's research capabilities and infrastructure. Supports advancements in physical, engineering, and life sciences. Potential to foster scientific breakthroughs and technological innovation. Contributes to the scientific workforce development in Michigan. Enhances the research ecosystem within the state and nationally.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Extended performance period raises questions about initial scope and potential cost overruns.
Lack of detailed cost breakdowns makes value assessment difficult.
Cost-reimbursement type contract may reduce contractor incentive for cost control.

Positive Signals

Awarded through full and open competition, suggesting a competitive process.
Long-term commitment indicates a sustained and important research need.
Focus on critical R&D areas aligns with national scientific priorities.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences. This sector is characterized by significant government investment aimed at fostering innovation and technological advancement. Spending in this area often supports academic institutions and private research firms. Comparable spending benchmarks would typically involve analyzing other large-scale R&D facility development or maintenance contracts awarded by agencies like NIH or NSF.

Small Business Impact

The data indicates this contract was not set aside for small businesses, and there is no explicit mention of subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem appears minimal. However, the large scale of the contract might indirectly benefit small businesses through potential supply chain opportunities if the primary contractor engages them.

Oversight & Accountability

Oversight for this contract would typically fall under the National Institutes of Health (NIH) and the Department of Health and Human Services (HHS). Mechanisms likely include regular progress reports, site visits, and financial reviews. The Inspector General's office for HHS provides an additional layer of oversight to ensure accountability and prevent fraud, waste, and abuse.

Related Government Programs

National Institutes of Health Research Facilities
Department of Health and Human Services Grants
University Research Infrastructure Programs
Physical Sciences Research Funding
Engineering Research Development
Life Sciences Research Support

Risk Flags

Long contract duration
Cost-reimbursement contract type
Potential for scope creep
Limited public detail on facility specifics

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $10.8 million to MICHIGAN STATE UNIVERSITY. RESEARCH AND DEVELOPMENT FACILITIES

Who is the contractor on this award?

The obligated recipient is MICHIGAN STATE UNIVERSITY.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $10.8 million.

What is the period of performance?

Start: 2003-09-29. End: 2015-08-05.

What specific types of research facilities were developed or maintained under this contract?

The contract data specifies 'RESEARCH AND DEVELOPMENT FACILITIES' but does not detail the specific types. Given the awarding agency (National Institutes of Health) and the NAICS code (541710 - Research and Development in the Physical, Engineering, and Life Sciences), it is highly probable that these facilities supported laboratory spaces, specialized equipment areas, and potentially administrative or support infrastructure for scientific research. The extended duration suggests a significant and ongoing need for these specialized environments to conduct cutting-edge scientific investigations across various disciplines within the physical, engineering, and life sciences.

How does the total award amount of over $10.8 million compare to typical R&D facility contracts of similar scope and duration?

Benchmarking this $10.8 million contract against similar R&D facility contracts is challenging without more specific details on the scope of work, the size and complexity of the facilities, and the geographic location. However, for a contract spanning over 12 years (from 2003 to 2015), this amount represents a moderate investment. Large-scale R&D facility construction or major renovations can easily run into tens or hundreds of millions of dollars. This contract likely supported the maintenance, upgrade, or specific development of existing or new research spaces rather than a complete new build of a massive research complex. The 'Cost No Fee' (CNF) or Cost Plus Fixed Fee (CPFF) nature, common in such contracts, means costs are reimbursed plus a fee, making direct cost comparisons complex.

What were the primary risks associated with this long-term R&D facility contract, and how were they managed?

Long-term R&D facility contracts inherently carry risks such as scope creep, cost overruns, technological obsolescence, and delays in completion. For this contract, the extended performance period (over 12 years) suggests potential challenges in maintaining the original scope and budget. Risk management likely involved rigorous oversight by the NIH, including regular progress reviews, site inspections, and adherence to established research protocols. The 'Cost No Fee' structure, while potentially reducing contractor risk, shifts more financial risk to the government, necessitating strong financial controls and auditing. Managing technological obsolescence would involve periodic reviews and potential upgrades to ensure facilities remained state-of-the-art.

What is the significance of Michigan State University receiving this substantial R&D funding from the NIH?

Receiving over $10.8 million in R&D funding from the National Institutes of Health (NIH) signifies a strong endorsement of Michigan State University's research capabilities and infrastructure. This funding likely supports critical research initiatives in the physical, engineering, and life sciences, contributing to the university's standing as a major research institution. Such awards can attract top-tier faculty and students, foster collaborations, and stimulate economic activity within Michigan through job creation and technological advancements. It also indicates that MSU's research proposals met the rigorous scientific and programmatic priorities of the NIH.

How did the 'full and open competition' process impact the final cost and quality of the R&D facilities?

The 'full and open competition' process, with 16 bids received, suggests a robust market response, which typically drives down costs and encourages higher quality offerings. By allowing all responsible sources to compete, the government could select the offer that best balanced price, technical merit, and past performance. This competitive pressure incentivizes contractors to propose efficient solutions and adhere to high standards to win the contract. While the specific cost savings are not detailed, the competitive nature is a key mechanism for ensuring value for taxpayer money in government procurement, leading to potentially better-equipped and more cost-effective research facilities.

What is the historical spending pattern for R&D facilities at Michigan State University by the federal government?

This specific contract represents a significant historical investment in R&D facilities at Michigan State University, totaling over $10.8 million and spanning from 2003 to 2015. To understand the broader historical pattern, one would need to analyze federal procurement databases for other contracts awarded to MSU for similar purposes (R&D facilities, laboratory construction/maintenance) by various federal agencies (e.g., NSF, DOE, DOD) over a longer period. This single contract indicates a substantial, long-term commitment from the NIH during its active period, suggesting MSU was a key partner for federal research infrastructure needs.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - CONSTRUCTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 16

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Address: 301 ADMINISTRATION BLDG, EAST LANSING, MI, 48824

Business Categories: Category Business, Educational Institution, Higher Education, Nonprofit Organization, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $10,226,293

Exercised Options: $4,243,677

Current Obligation: $10,836,293

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline