DoD's $196.6M Missile Defense Contract to AMTEC Corporation: A Deep Dive into Value and Competition

Contract Overview

Contract Amount: $29,061,937 ($29.1M)

Contractor: Amtec Corporation

Awarding Agency: Department of Defense

Start Date: 2000-04-06

End Date: 2008-09-30

Contract Duration: 3,099 days

Daily Burn Rate: $9.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 200008!2100!001029!SG60 !USA SPACE AND STRATEGIC DEF CDR !DASG6099C0268 !A!*!0 !20000406!20050405!196595607!196595607!196595607!N!0EJL2!AMTEC CORPORATION !500 WYNN DRIVE, SUITE 314 !HUNTSVILLE !AL!35816!37000!089!01!HUNTSVILLE !MADISON !ALABAMA !0001!+000000377603!N!N!000000000000!AC23!RDTE/MISSILE AND SPACE SYSTEMS-ADV TECH DEV !A2 !MISSILE AND SPACE SYSTEMS !1CAA!BALLISTIC MISSILE DEFENSE SYS !8731!1!*!*!*!B!A!*!D !N!U!1!001!N!1G!Z!Y!Z!* !* !N!B!N!B!*!A!A!A!A!* !*!N!A!B!N!*!*!*!*!*!

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35805

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $29.1 million to AMTEC CORPORATION for work described as: 200008!2100!001029!SG60 !USA SPACE AND STRATEGIC DEF CDR !DASG6099C0268 !A!*!0 !20000406!20050405!196595607!196595607!196595607!N!0EJL2!AMTEC CORPORATION !500 WYNN DRIVE, SUITE 314 !HUNTSVILLE !AL!35816!37000!089!01!HUNTSVILLE !MAD… Key points: 1. Contract awarded on a sole-source basis, raising questions about price discovery and potential for overpayment. 2. Significant contract value suggests a critical role in missile and space systems, but performance context is limited. 3. Lack of competition indicates potential risks related to contractor lock-in and reduced incentive for cost efficiency. 4. The contract's duration and cost-plus-fixed-fee structure may not align with optimal value-for-money principles. 5. Analysis needed to benchmark pricing against similar missile defense development contracts. 6. Oversight and accountability mechanisms are crucial given the sole-source nature and substantial funding.

Value Assessment

Rating: questionable

The total award amount of $196.6 million over a period of approximately 8 years (2000-2008) for missile and space systems advanced technology development warrants scrutiny. Without a competitive bidding process, it is difficult to ascertain if this represents a fair market price. The cost-plus-fixed-fee (CPFF) contract type, while common for R&D, can incentivize cost overruns if not rigorously managed. Benchmarking against similar sole-source R&D contracts in the defense sector would be necessary to provide a more definitive value assessment.

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. This approach is typically justified when only one responsible source can provide the required goods or services. However, it significantly limits price discovery and can lead to higher costs for the government compared to a fully competed contract. The absence of multiple bidders means there was no direct competition to drive down prices or encourage innovative solutions.

Taxpayer Impact: For taxpayers, a sole-source award means there is a higher risk of paying a premium for the services rendered, as the government did not benefit from the competitive pressure that typically leads to more favorable pricing.

Public Impact

The primary beneficiaries are likely the Department of Defense's missile defense programs, which receive advanced technological development. Services delivered include research, development, testing, and evaluation for missile and space systems. The geographic impact is centered around the contractor's location in Huntsville, Alabama, a known hub for aerospace and defense industries. Workforce implications include employment for specialized engineers, scientists, and technical personnel within AMTEC Corporation and its potential subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially increasing costs.
Cost-plus-fixed-fee structure may not sufficiently incentivize cost control.
Lack of transparency in the procurement process due to sole-source nature.
Performance metrics and outcomes are not detailed in the provided data.
Long contract duration without clear performance milestones could pose risks.

Positive Signals

Contract supports critical advanced technology development for national security.
Contractor is located in a region with significant defense industry expertise.
The contract was awarded by a major defense agency, suggesting a level of vetting.
The fixed fee component provides some cost certainty for the government.

Sector Analysis

This contract falls within the Research, Development, Test, and Evaluation (RDTE) sector, specifically focusing on advanced technology development for missile and space systems. The defense industry, particularly in areas like ballistic missile defense, is characterized by high R&D investment and long development cycles. Comparable spending benchmarks would involve analyzing other large, sole-source RDTE contracts awarded by the Department of Defense for similar advanced technological capabilities, which are often in the hundreds of millions of dollars.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses, nor does it explicitly mention subcontracting plans for small businesses. Given the large dollar value and specialized nature of missile and space systems development, it is possible that AMTEC Corporation, as the prime contractor, would engage small businesses for specific components or services. However, without explicit set-aside requirements or reporting, the direct impact on the small business ecosystem is unclear and likely secondary to the prime contractor's capabilities.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Accountability measures would be embedded within the contract's terms and conditions, including reporting requirements and payment schedules tied to milestones. Transparency is limited due to the sole-source nature of the award; however, internal DoD oversight and potentially Inspector General reviews would be in place to monitor the program's progress and financial integrity.

Related Government Programs

Ballistic Missile Defense Systems
Missile and Space Systems Research and Development
Advanced Technology Development Contracts
Department of Defense Research and Development Spending

Risk Flags

Sole-source award
Cost-plus-fixed-fee contract type
Lack of detailed performance data
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.1 million to AMTEC CORPORATION. 200008!2100!001029!SG60 !USA SPACE AND STRATEGIC DEF CDR !DASG6099C0268 !A!*!0 !20000406!20050405!196595607!196595607!196595607!N!0EJL2!AMTEC CORPORATION !500 WYNN DRIVE, SUITE 314 !HUNTSVILLE !AL!35816!37000!089!01!HUNTSVILLE !MADISON !ALABAMA !0001!+000000377603!N!N!000000000000!AC23!RDTE/MISSILE AND SPACE SYSTEMS-ADV TECH DEV !A2 !MISSILE AND SPACE SYSTEMS !1CAA!BALLISTIC MISSILE DEFENSE SYS !8731!1!*!*!*!B!A!*!D !N!U!

Who is the contractor on this award?

The obligated recipient is AMTEC CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $29.1 million.

What is the period of performance?

Start: 2000-04-06. End: 2008-09-30.

What specific advanced technologies were developed under this contract for missile and space systems?

The provided data does not specify the exact nature of the 'advanced tech dev' for missile and space systems. However, given the contractor's location in Huntsville, Alabama, a major center for missile defense research, and the contract's classification under 'MISSILE AND SPACE SYSTEMS-ADV TECH DEV' and 'BALLISTIC MISSILE DEFENSE SYS', it is highly probable that the development efforts were related to enhancing capabilities for detecting, tracking, and intercepting ballistic missiles. This could encompass areas such as sensor technology, guidance systems, interceptor components, or system integration for missile defense architectures. Further details would require access to contract line item numbers (CLINs) and technical performance reports.

How does the $196.6 million total award compare to other similar sole-source R&D contracts in the defense sector?

Comparing this $196.6 million sole-source award requires access to a broader dataset of defense contracts. However, for advanced technology development in specialized areas like missile defense, such figures are not uncommon, especially for programs with long development timelines and high technical risk. Sole-source awards in the hundreds of millions are often justified for unique capabilities or when a specific contractor possesses proprietary technology or critical expertise essential for national security. Without specific benchmarks for comparable sole-source R&D efforts in missile defense, it's challenging to definitively state if this represents a high or low value, but it falls within the expected range for significant defense R&D initiatives.

What are the potential risks associated with a sole-source, cost-plus-fixed-fee contract for advanced technology development?

A sole-source award eliminates competitive pressure, which can lead to higher prices and reduced incentive for the contractor to innovate or control costs aggressively. The cost-plus-fixed-fee (CPFF) structure, while providing some cost certainty through the fixed fee, can still incentivize cost growth as the contractor is reimbursed for allowable costs. If oversight is insufficient, the government may end up paying more than necessary. Risks include potential cost overruns, less efficient development processes, and a lack of alternative solutions if the chosen technology path proves unsuccessful. Robust government oversight, clear performance metrics, and rigorous cost tracking are essential to mitigate these risks.

What was the historical spending pattern for AMTEC CORPORATION with the Department of Defense prior to and during this contract period?

The provided data focuses solely on this specific contract (DASG6099C0268) awarded in 2000. It does not offer information on AMTEC CORPORATION's prior or subsequent federal spending patterns. To assess historical spending, one would need to query federal procurement databases for all contracts awarded to AMTEC CORPORATION across different agencies and years. This would reveal trends in contract types, values, and agencies served, providing context for their overall engagement with the federal government and their role in the defense industrial base.

What specific performance metrics or milestones were associated with this contract to ensure accountability?

The provided summary data does not include specific performance metrics or milestones tied to this contract. For a Cost Plus Fixed Fee (CPFF) contract, especially one involving Research, Development, Test, and Evaluation (RDTE), performance is typically measured against defined technical objectives, delivery schedules for prototypes or reports, and adherence to budget constraints. The fixed fee is earned upon successful completion of these objectives. Without access to the contract's Statement of Work (SOW) or performance reports, it is impossible to detail the specific metrics used to ensure accountability for the $196.6 million awarded.

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

Address: 654-A DISCOVERY DR, HUNTSVILLE, AL, 35806

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Business, Subchapter S Corporation

Financial Breakdown

Contract Ceiling: $115,000

Exercised Options: $3,444,154

Current Obligation: $29,061,937

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline