DoD's $18.1M R&D Contract with UT Austin: Limited Competition Raises Cost Concerns
Contract Overview
Contract Amount: $18,136,768 ($18.1M)
Contractor: University of Texas AT Austin
Awarding Agency: Department of Defense
Start Date: 2010-03-24
End Date: 2014-09-30
Contract Duration: 1,651 days
Daily Burn Rate: $11.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: RESEARCH & DEV.
Place of Performance
Location: AUSTIN, TRAVIS County, TEXAS, 78758, UNITED STATES OF AMERICA
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $18.1 million to UNIVERSITY OF TEXAS AT AUSTIN for work described as: RESEARCH & DEV. Key points: 1. Significant investment in physical, engineering, and life sciences R&D. 2. Sole-source award to a single academic institution limits competitive pricing. 3. Potential for higher costs due to lack of market competition. 4. Focus on specialized research may justify limited competition, but requires careful oversight.
Value Assessment
Rating: questionable
The contract's Cost Plus Fixed Fee structure, combined with a sole-source award, makes direct pricing comparisons difficult. Without competitive bids, it's hard to ascertain if the $18.1M represents optimal value for the research conducted.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning no other vendors were solicited. This approach bypasses the competitive bidding process, potentially leading to less favorable pricing and reduced price discovery.
Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for the research services, as market pressures to offer the lowest price are absent.
Public Impact
Funding advanced scientific research at a leading university. Potential for breakthroughs in physical, engineering, and life sciences. Impact on academic-industry-government research collaborations. Long-term benefits of scientific advancement for national security or public good.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Cost-plus contract type can incentivize spending.
- Long contract duration (over 4 years) increases risk of cost overruns.
- No small business participation noted.
Positive Signals
- Supports critical R&D in key scientific fields.
- Partnership with a reputable academic institution.
- Potential for significant technological advancements.
Sector Analysis
The contract falls under Research and Development in the Physical, Engineering, and Life Sciences (NAICS 541710). Federal spending in this sector is crucial for innovation but often involves complex, non-standardized services where competition can be challenging.
Small Business Impact
There is no indication of small business participation in this contract. Given the nature of university research, subcontracting opportunities for small businesses may be limited, but this should be verified.
Oversight & Accountability
The sole-source nature of this award necessitates robust oversight from the Department of the Navy to ensure costs are reasonable and the research objectives are met efficiently. Regular reviews of expenditures and progress are critical.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award
- Cost-plus contract type
- Lack of small business participation
- Long contract duration
Tags
research-and-development-in-the-physical, department-of-defense, tx, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $18.1 million to UNIVERSITY OF TEXAS AT AUSTIN. RESEARCH & DEV.
Who is the contractor on this award?
The obligated recipient is UNIVERSITY OF TEXAS AT AUSTIN.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $18.1 million.
What is the period of performance?
Start: 2010-03-24. End: 2014-09-30.
How was the fixed fee determined in this Cost Plus Fixed Fee contract to ensure it reflects fair compensation for the University of Texas at Austin's efforts?
The determination of the fixed fee in a Cost Plus Fixed Fee (CPFF) contract typically involves negotiations based on the anticipated cost of the work, the complexity of the research, the contractor's experience, and the level of risk involved. For this sole-source award, the Department of the Navy would have assessed these factors to arrive at a fee deemed fair and reasonable, likely through detailed cost analysis and benchmarking against similar research projects, though specific details are not provided.
What specific risks are associated with a sole-source R&D contract awarded to a university, and how were they mitigated?
Risks include potential cost overruns due to the inherent uncertainties in research, lack of competitive pressure on pricing, and scope creep. Mitigation strategies would involve stringent oversight, clear definition of research milestones, regular progress reviews, and robust cost accounting standards. The fixed fee component aims to cap the contractor's profit, providing some cost control, but the 'cost plus' aspect still leaves the government exposed to the actual research expenses.
Beyond the direct research output, what are the broader effectiveness measures for this $18.1M investment in university-led R&D?
Effectiveness extends beyond immediate research findings. It includes the development of intellectual property, the training of future scientists and engineers, strengthening the university's research infrastructure, and potentially fostering long-term collaborations between academia and the Department of Defense. Measuring these broader impacts requires tracking publications, patents, workforce development, and the transition of research into practical applications or further development.
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: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: University of Texas System (UEI: 042000273)
Address: 10000 BURNET ROAD, AUSTIN, TX, 78758
Business Categories: Category Business, Educational Institution, Government, Higher Education, Not Designated a Small Business, U.S. Regional/State Government
Financial Breakdown
Contract Ceiling: $18,136,768
Exercised Options: $18,136,768
Current Obligation: $18,136,768
Contract Characteristics
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: N0002407D6200
IDV Type: IDC
Timeline
Start Date: 2010-03-24
Current End Date: 2014-09-30
Potential End Date: 2014-09-30 00:00:00
Last Modified: 2015-09-28
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