DOE awards $14.5B for linear accelerator operations and maintenance to Stanford University

Contract Overview

Contract Amount: $14,538,293,214 ($14.5B)

Contractor: THE Leland Stanford Junior University

Awarding Agency: Department of Energy

Start Date: 1978-11-20

End Date: 2027-09-30

Contract Duration: 17,846 days

Daily Burn Rate: $814.7K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: COST NO FEE

Sector: R&D

Official Description: OPERATION AND MAINTENANCE LINEAR ACCELLERATOR

Place of Performance

Location: MENLO PARK, SAN MATEO County, CALIFORNIA, 94305

State: California Government Spending

Plain-Language Summary

Department of Energy obligated $14.54 billion to THE LELAND STANFORD JUNIOR UNIVERSITY for work described as: OPERATION AND MAINTENANCE LINEAR ACCELLERATOR Key points: 1. Long-term contract for critical research infrastructure. 2. Sole-source award raises questions about competition and potential cost savings. 3. Significant duration suggests a stable, ongoing need for these services. 4. Focus on R&D in physical, engineering, and life sciences. 5. Contract value is substantial, indicating a high level of investment. 6. Geographic concentration in California for this major federal investment.

Value Assessment

Rating: fair

The contract's value of $14.5 billion over its extended period suggests a significant investment in maintaining a critical research asset. Benchmarking this specific type of operation and maintenance for a linear accelerator is challenging due to its specialized nature. However, the 'COST NO FEE' contract type implies that the government reimburses the contractor for allowable costs, with no additional profit. This can sometimes lead to less incentive for cost control compared to fixed-price contracts, though it ensures continuity of essential services. Without comparable contracts for similar facilities, a precise value-for-money assessment is difficult, but the sheer scale warrants scrutiny.

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. The data indicates it is 'NOT AVAILABLE FOR COMPETITION'. This approach is typically used when a single source is uniquely qualified or when urgency or other factors preclude a competitive process. The lack of competition means that the government did not benefit from potential price reductions or innovative solutions that might have emerged from a bidding process. This raises concerns about whether the government secured the best possible pricing and terms.

Taxpayer Impact: Sole-source awards mean taxpayers may not be receiving the most cost-effective solution, as the absence of competition limits price discovery and negotiation leverage.

Public Impact

The Leland Stanford Junior University benefits as the primary contractor, ensuring continued operation of a major research facility. Researchers across physical, engineering, and life sciences will have access to advanced experimental capabilities. The contract supports high-skilled jobs in scientific research, engineering, and facility management in California. The geographic impact is concentrated in California, where the linear accelerator is located.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially impacting cost efficiency for taxpayers.
Long contract duration (over 40 years from award to projected end) may indicate a lack of flexibility or opportunities for re-evaluation.
Cost-reimbursement contract type can sometimes disincentivize aggressive cost control by the contractor.

Positive Signals

Ensures continuity of critical research infrastructure, supporting national scientific advancement.
Long-term commitment provides stability for research planning and investment by the contractor and users.
Focus on R&D aligns with national priorities for innovation and discovery.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on the operation and maintenance of a large-scale scientific instrument. The North American Industry Classification System (NAICS) code 541710, 'Research and Development in the Physical, Engineering, and Life Sciences,' encompasses a broad range of scientific endeavors. The market for operating and maintaining such specialized, large-scale research facilities is highly concentrated, often involving unique expertise and infrastructure. Comparable spending benchmarks are difficult to establish due to the unique nature of linear accelerators and their associated operational needs.

Small Business Impact

The data indicates that small business participation is not a stated factor in this contract (ss: false, sb: false). As a sole-source award to a large university, it is unlikely that small businesses will be directly involved as subcontractors unless specifically mandated or if the university chooses to engage them for specialized services. This contract does not appear to be designed to benefit the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Energy (DOE), which is both the funding and the contracting agency. Given the long duration and significant value, robust oversight mechanisms are crucial. This would likely involve regular performance reviews, audits of cost reimbursements, and adherence to safety and operational protocols. The DOE's Inspector General would have jurisdiction to investigate any potential fraud, waste, or abuse related to the contract.

Related Government Programs

Department of Energy Research Facilities
National Laboratory Operations
Large-Scale Scientific Instrumentation
Physics Research Grants
Engineering Research Support

Risk Flags

Sole-source award
Long contract duration
Cost-reimbursement contract type
Lack of small business set-aside

Frequently Asked Questions

What is this federal contract paying for?

Department of Energy awarded $14.54 billion to THE LELAND STANFORD JUNIOR UNIVERSITY. OPERATION AND MAINTENANCE LINEAR ACCELLERATOR

Who is the contractor on this award?

The obligated recipient is THE LELAND STANFORD JUNIOR UNIVERSITY.

Which agency awarded this contract?

Awarding agency: Department of Energy (Department of Energy).

What is the total obligated amount?

The obligated amount is $14.54 billion.

What is the period of performance?

Start: 1978-11-20. End: 2027-09-30.

What is the historical spending trend for the operation and maintenance of this linear accelerator prior to this award?

Detailed historical spending data for this specific linear accelerator prior to the current award is not provided in the given data snippet. However, the contract's start date of 1978 and projected end date of 2027 suggest a very long-standing relationship between the Department of Energy and The Leland Stanford Junior University for the operation of this facility. The sheer scale of the current award ($14.5 billion) implies substantial and consistent annual expenditures over decades. To understand historical trends, one would need to access historical contract awards and modifications for this facility over its operational lifespan, looking at annual obligated amounts and the contract type used in previous periods. This would reveal if spending has been consistently high, or if there have been significant fluctuations tied to upgrades, operational changes, or shifts in research priorities.

How does the 'COST NO FEE' contract type compare to other contract types for similar R&D infrastructure maintenance?

The 'COST NO FEE' (CNF) contract type is relatively uncommon for large-scale, long-term operational contracts, especially in R&D infrastructure maintenance. Typically, contracts of this nature might utilize Cost Plus Fixed Fee (CPFF), Cost Plus Incentive Fee (CPIF), or even Firm-Fixed-Price (FFP) if the scope is well-defined and stable. CNF contracts reimburse the contractor only for allowable costs incurred, without any additional profit or fee. This is often used in situations where the contractor is a non-profit entity or government-owned/contractor-operated facility where profit is not the primary driver, and the focus is on ensuring the service is performed. While it ensures continuity and avoids profit motives, it can reduce the contractor's incentive for aggressive cost management compared to fee-based contracts. Benchmarking requires comparing the total cost of ownership over time against similar facilities managed under different contract structures, considering factors like efficiency, uptime, and maintenance quality.

What are the specific performance metrics and deliverables expected under this contract?

The provided data snippet does not detail the specific performance metrics and deliverables for this contract. However, for a contract focused on the 'OPERATION AND MAINTENANCE' of a 'LINEAR ACCELLERATOR' for 'Research and Development,' key performance indicators (KPIs) would typically include facility uptime, availability of the accelerator for research experiments, adherence to safety protocols, successful completion of scheduled maintenance, and response times for unscheduled repairs. Deliverables would likely encompass regular operational reports, maintenance logs, safety compliance documentation, and potentially progress reports on research support activities. The 'COST NO FEE' structure suggests that the primary deliverable is the sustained, safe, and effective operation of the facility to support the DOE's research mission.

What is the justification for awarding this contract as sole-source, given its substantial value?

The justification for awarding this contract as sole-source is indicated by 'CT: NOT AVAILABLE FOR COMPETITION'. While the specific rationale is not detailed, common justifications for sole-source awards of this magnitude include the unique capabilities or specialized knowledge possessed by the contractor, the critical nature of the facility requiring uninterrupted service from the incumbent, or the potential for significant disruption and cost if transitioning to a new provider. For a large-scale, long-operational research facility like a linear accelerator, the incumbent contractor (The Leland Stanford Junior University) likely possesses highly specialized institutional knowledge, trained personnel, and established operational procedures that are difficult and costly to replicate. The DOE may have determined that a competitive process would be impractical, excessively expensive, or detrimental to the ongoing research mission.

What are the potential risks associated with the long duration of this contract (1978-2027)?

The exceptionally long duration of this contract, spanning nearly five decades from its initial award to its projected completion, presents several potential risks. Firstly, it reduces flexibility for the government to adapt to changing technological needs, research priorities, or alternative solutions that may emerge over time. Secondly, the extended period without formal re-competition can lead to complacency or reduced pressure on the contractor to innovate or optimize costs. Thirdly, institutional knowledge may become concentrated within the contractor, potentially creating barriers for future competition or oversight. Finally, long-term cost projections become more uncertain, and the government may be locked into terms that become unfavorable as market conditions or technological landscapes evolve. Regular reviews and potential modification clauses are critical to mitigate these risks.

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: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Pricing Type: COST NO FEE (S)

Contractor Details

Parent Company: Leland Stanford Junior University

Address: 651 SERRA ST, STANFORD, CA, 94305

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

Financial Breakdown

Contract Ceiling: $14,976,833,219

Exercised Options: $14,976,833,219

Current Obligation: $14,538,293,214

Actual Outlays: $3,675,641,568

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Timeline