MITRE Corporation awarded $13.2M contract for CHIPS Support Services by Department of Commerce

Contract Overview

Contract Amount: $13,249,006 ($13.2M)

Contractor: THE Mitre Corporation

Awarding Agency: Department of Commerce

Start Date: 2023-07-31

End Date: 2026-09-11

Contract Duration: 1,138 days

Daily Burn Rate: $11.6K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: CHIPS SUPPORT SERVICES

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Commerce obligated $13.2 million to THE MITRE CORPORATION for work described as: CHIPS SUPPORT SERVICES Key points: 1. Contract awarded to a single, non-profit organization with a history of government support. 2. Services are categorized under 'All Other Professional, Scientific, and Technical Services'. 3. Contract duration extends over three years, indicating a need for sustained support. 4. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 5. No small business set-aside was applied, suggesting the scope may not have been suitable for smaller entities. 6. The contract is a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle, implying a pre-existing relationship and established pricing.

Value Assessment

Rating: fair

The contract value of $13.2 million for CHIPS Support Services appears reasonable given the three-year duration and the nature of professional, scientific, and technical services. However, without specific benchmarks for 'CHIPS Support Services' or comparable contracts for similar technical assistance, a definitive value-for-money assessment is challenging. The Cost Plus Fixed Fee (CPFF) contract type introduces a degree of risk, as costs can escalate beyond initial estimates, though the fixed fee component provides some predictability for the contractor's profit. Benchmarking against other MITRE contracts for similar technical services would be necessary for a more precise evaluation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when a specific contractor possesses unique capabilities, or when it's deemed most efficient to continue with an existing provider. The lack of competition means that pricing was not subjected to market forces, potentially leading to higher costs than if multiple bids had been solicited. The justification for a sole-source award would need to demonstrate why other sources could not be identified or why this specific contractor is uniquely qualified.

Taxpayer Impact: Taxpayers may not have received the benefit of competitive pricing, which could have resulted in a lower overall cost for these services.

Public Impact

The primary beneficiaries are likely the National Institute of Standards and Technology (NIST) and the broader CHIPS program, receiving essential technical and scientific support. Services delivered include professional, scientific, and technical assistance crucial for the implementation and oversight of the CHIPS program. The geographic impact is primarily within Virginia, where the contract is managed, but the CHIPS program itself has national implications for the semiconductor industry. Workforce implications may include the utilization of highly skilled technical experts from The MITRE Corporation, contributing to the success of a key national initiative.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially increases costs for taxpayers.
Cost Plus Fixed Fee (CPFF) contract type carries inherent risk of cost overruns.
Lack of competition may reduce incentives for efficiency and innovation from the contractor.
The broad 'All Other Professional, Scientific, and Technical Services' category lacks specificity, making performance monitoring potentially more complex.

Positive Signals

Award to The MITRE Corporation, a well-established non-profit federally funded research and development center (FFRDC), suggests a high level of technical expertise.
The contract duration of over three years indicates a stable, long-term need for critical support services.
The contract is a delivery order under an existing IDIQ, implying a streamlined process and potentially pre-negotiated favorable terms.
Support for the CHIPS program aligns with national strategic priorities in semiconductor manufacturing and research.

Sector Analysis

This contract falls within the Professional, Scientific, and Technical Services sector, specifically under the 'All Other Professional, Scientific, and Technical Services' NAICS code (541990). This sector is characterized by a wide range of specialized expertise, often supporting government initiatives in research, development, analysis, and program management. The CHIPS program itself represents a significant government investment in bolstering domestic semiconductor manufacturing and innovation, making technical support services critical for its success. Comparable spending in this sector often involves large, complex contracts supporting R&D, policy analysis, and program implementation, with values ranging from millions to billions of dollars depending on the scope and duration.

Small Business Impact

This contract was not set aside for small businesses, nor does it indicate any specific subcontracting requirements for small businesses. The award to The MITRE Corporation, a large, established organization, suggests that the primary focus was on specialized expertise rather than small business participation. This could mean that the nature of the services required was highly specialized and best suited for a large, experienced entity, or that opportunities for small businesses were not actively pursued or identified within the scope of this particular award.

Oversight & Accountability

Oversight for this contract would primarily reside with the National Institute of Standards and Technology (NIST) within the Department of Commerce. As a delivery order under an IDIQ, there may be established oversight mechanisms from the parent contract. The Cost Plus Fixed Fee (CPFF) nature of the award necessitates close monitoring of costs and performance to ensure that expenditures remain reasonable and that the contractor is meeting its obligations. Transparency would depend on the reporting requirements stipulated in the contract and the agency's commitment to public disclosure of contract details and performance.

Related Government Programs

CHIPS Program
National Semiconductor Technology Center (NSTC)
National Advanced Packaging Manufacturing Program
Manufacturing USA Institutes
Federal Funding Opportunity (FFO) administration

Risk Flags

Sole-source award lacks competitive pricing.
CPFF contract type poses risk of cost overruns.
Broad service category may obscure specific performance metrics.

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $13.2 million to THE MITRE CORPORATION. CHIPS SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is THE MITRE CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Commerce (National Institute of Standards and Technology).

What is the total obligated amount?

The obligated amount is $13.2 million.

What is the period of performance?

Start: 2023-07-31. End: 2026-09-11.

What is The MITRE Corporation's track record with government contracts, particularly in technical and scientific support roles?

The MITre Corporation has an extensive and generally positive track record with U.S. federal agencies, operating primarily as a Federally Funded Research and Development Center (FFRDC). They are known for providing objective, independent research and development, systems engineering, and program management support across various domains, including defense, intelligence, healthcare, and infrastructure. Their work often involves complex technical challenges and strategic advisory roles. For the Department of Commerce and NIST, MITRE has historically provided support in areas related to technology policy, standards development, and scientific research. Their long-standing relationship with the government, coupled with their non-profit status, positions them as a trusted advisor. Performance on past contracts has generally been rated highly, though specific details are often proprietary or found in agency performance evaluations.

How does the $13.2 million contract value compare to similar technical support contracts awarded by the Department of Commerce or NIST?

Comparing the $13.2 million contract value for 'CHIPS Support Services' requires context regarding the specific services rendered and the duration. Contracts for professional, scientific, and technical services can vary widely. For instance, NIST and other agencies within the Department of Commerce often award contracts for research, analysis, and program management that can range from hundreds of thousands to tens of millions of dollars. Given that this contract spans over three years (approximately 1138 days), the annual value is roughly $4.4 million. This figure is within the typical range for significant, multi-year technical support engagements. However, without a detailed statement of work, it's difficult to make a precise comparison to other contracts, as the scope and complexity of 'CHIPS Support Services' are unique to the program's objectives.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for these services?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract is the potential for cost overruns. In a CPFF arrangement, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing their profit. While the fixed fee provides some incentive for the contractor to control costs (as their profit is capped), it does not directly link their profit to cost savings. If the actual costs exceed estimates, the government bears the burden of these increased expenses, up to the contract's ceiling. For the government, effective oversight and robust cost accounting are crucial to ensure that all reimbursed costs are reasonable, allocable, and allowable. Poorly defined scopes of work or inadequate monitoring can exacerbate the risk of the government paying more than necessary for the services rendered.

What is the strategic importance of the CHIPS program and the support services being provided?

The CHIPS and Science Act aims to bolster U.S. leadership in semiconductor research, development, manufacturing, and workforce. The semiconductor industry is critical for national security, economic competitiveness, and technological innovation, underpinning everything from advanced computing and AI to telecommunications and defense systems. The support services provided under this contract are therefore strategically vital. They likely assist the National Institute of Standards and Technology (NIST) in executing key aspects of the CHIPS program, such as evaluating funding applications, providing technical expertise for research initiatives, developing standards, and ensuring the effective implementation of the program's objectives. This support directly contributes to the national goal of strengthening domestic semiconductor supply chains and advancing scientific discovery.

How does the sole-source nature of this award impact accountability and transparency?

A sole-source award, by definition, bypasses the competitive bidding process, which is a primary mechanism for ensuring price reasonableness and accountability. When a contract is competed, multiple proposals are evaluated, allowing the agency to select the best value offer and providing a benchmark for pricing. In a sole-source scenario, the government relies heavily on negotiation and the contractor's established reputation and pricing history. Accountability is then primarily driven by the contract's performance metrics, reporting requirements, and the agency's oversight capabilities. Transparency can be reduced because the rationale for the sole-source award and the details of the negotiation process are not publicly scrutinized as they would be in a competitive procurement. This places a greater onus on the contracting agency to rigorously justify the award and diligently monitor performance and costs.

What are the potential implications of awarding this contract to a non-profit organization like The MITRE Corporation versus a for-profit entity?

Awarding this contract to The MITRE Corporation, a non-profit FFRDC, has several implications compared to a for-profit entity. As an FFRDC, MITRE is expected to provide objective, independent analysis and technical support, free from the profit motives that might influence a commercial firm. This can lead to higher quality, more unbiased recommendations and solutions. Furthermore, FFRDCs often have unique access to government data and personnel, facilitating deep integration into agency operations. While MITRE does receive fees for its services, its non-profit status and FFRDC designation suggest a focus on mission accomplishment rather than maximizing shareholder returns. This can translate into a strong commitment to public service and national interest objectives, potentially offering better value in terms of expertise and strategic insight, even if direct cost comparisons are complex.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: RESEARCH AND DEVELOPMENT › General Science and Technology R&D Services

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

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

Financial Breakdown

Contract Ceiling: $23,254,192

Exercised Options: $13,249,006

Current Obligation: $13,249,006

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: 1331L523D13OS0003

IDV Type: IDC

Timeline