DOE's $3B Oak Ridge Institute contract awarded to Oak Ridge Associated Universities, Inc. for scientific services
Contract Overview
Contract Amount: $3,022,479,603 ($3.0B)
Contractor: OAK Ridge Associated Universities, Incorporated
Awarding Agency: Department of Energy
Start Date: 2016-03-10
End Date: 2026-09-30
Contract Duration: 3,856 days
Daily Burn Rate: $783.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS AWARD FEE
Sector: R&D
Official Description: IGF::OT::IGF MANAGEMENT OF THE OAK RIDGE INSTITUTE FOR SCIENCE AND EDUCATION
Place of Performance
Location: OAK RIDGE, ANDERSON County, TENNESSEE, 37831
Plain-Language Summary
Department of Energy obligated $3.02 billion to OAK RIDGE ASSOCIATED UNIVERSITIES, INCORPORATED for work described as: IGF::OT::IGF MANAGEMENT OF THE OAK RIDGE INSTITUTE FOR SCIENCE AND EDUCATION Key points: 1. The contract represents a significant investment in scientific research and development support. 2. The long duration suggests a critical, ongoing need for these specialized services. 3. The cost-plus award fee structure incentivizes performance but requires careful oversight. 4. The single awardee indicates a focused relationship, potentially limiting broader market engagement. 5. The contract's value places it among substantial federal science support endeavors. 6. Geographic concentration in Tennessee highlights regional economic impact.
Value Assessment
Rating: good
The total contract value of over $3 billion over its lifespan is substantial. Benchmarking this against similar large-scale scientific support contracts is challenging due to the unique nature of the Oak Ridge Institute. However, the cost-plus award fee (CPAF) structure, while common for complex R&D, necessitates rigorous performance monitoring to ensure value for money. The award fee component allows for adjustments based on performance, which can be a positive indicator if managed effectively, but also introduces potential for cost creep if not tightly controlled.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple offerors had the opportunity to bid. The presence of two bids suggests a competitive process, though the specifics of the competition (e.g., number of proposals received, evaluation criteria) are not detailed here. A competitive award is generally favorable for price discovery and ensuring the government receives the best value.
Taxpayer Impact: Full and open competition helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces and encouraging innovative solutions from a wider pool of potential contractors.
Public Impact
The Oak Ridge Institute for Science and Education (ORISE) benefits from sustained funding, enabling its mission. Scientists, researchers, and technical personnel in Tennessee and potentially nationwide are supported through employment and research opportunities. The contract supports critical scientific research and educational initiatives, impacting various fields of science. The geographic impact is concentrated in Oak Ridge, Tennessee, providing significant economic benefits to the region. The workforce implications include the employment of highly skilled scientists, engineers, and support staff.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus award fee contracts require diligent oversight to prevent unmanaged cost growth.
- The long contract duration could lead to complacency if performance metrics are not continuously updated and enforced.
- Reliance on a single contractor for such a critical function may pose a risk if the contractor faces significant operational challenges.
Positive Signals
- Awarded through full and open competition, suggesting a robust selection process.
- The contract structure includes award fees, which can incentivize high performance and mission success.
- The significant value indicates the critical importance and recognized need for the services provided.
Sector Analysis
This contract falls within the Professional, Scientific, and Technical Services sector, specifically related to research and development support. The market for such services is large and diverse, encompassing a wide range of scientific disciplines and technical expertise. Contracts like this are crucial for government agencies to leverage external capabilities for specialized research, management, and operational support, often complementing in-house expertise. Comparable spending benchmarks would typically be found within large federal R&D portfolios and science support organizations.
Small Business Impact
The data indicates that small business participation (sb: false) was not a specific set-aside requirement for this contract. While the prime contractor is not a small business, there may be subcontracting opportunities for small businesses within the scope of this large award. The extent of small business subcontracting would depend on the prime contractor's strategy and the specific needs of the services performed.
Oversight & Accountability
Oversight for this contract would primarily reside with the Department of Energy's contracting officers and program managers. The cost-plus award fee structure necessitates detailed performance monitoring and financial audits to ensure accountability and prevent cost overruns. Inspector General jurisdiction would likely apply to investigate any potential fraud, waste, or abuse related to the contract's execution.
Related Government Programs
- Oak Ridge National Laboratory Operations
- National Science Foundation Research Grants
- Department of Energy Science Programs
- National Institutes of Health Research Contracts
Risk Flags
- Cost-plus award fee requires diligent performance monitoring.
- Long contract duration may reduce competitive pressure over time.
- Reliance on a single awardee for critical services.
Tags
department-of-energy, scientific-services, research-and-development, definitive-contract, cost-plus-award-fee, full-and-open-competition, oak-ridge-tennessee, large-business, science-and-technology, federal-contract, doe, orise
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $3.02 billion to OAK RIDGE ASSOCIATED UNIVERSITIES, INCORPORATED. IGF::OT::IGF MANAGEMENT OF THE OAK RIDGE INSTITUTE FOR SCIENCE AND EDUCATION
Who is the contractor on this award?
The obligated recipient is OAK RIDGE ASSOCIATED UNIVERSITIES, INCORPORATED.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $3.02 billion.
What is the period of performance?
Start: 2016-03-10. End: 2026-09-30.
What is the historical spending trend for the Oak Ridge Institute for Science and Education under this contract vehicle?
The provided data reflects the total estimated value of the contract from its start date (March 10, 2016) to its end date (September 30, 2026), amounting to approximately $3.02 billion. This represents the planned expenditure over the contract's duration. To understand historical spending trends, one would need access to annual or quarterly expenditure reports. These reports would detail how much of the total obligated amount has been spent each year since 2016. Analyzing these figures would reveal if spending has been consistent, increasing, or decreasing, and whether it aligns with the projected trajectory. Without specific historical disbursement data, we can only infer that spending has occurred progressively since the award date, leading up to the current point in the contract's lifecycle.
How does the cost-plus award fee (CPAF) structure compare to other contract types for similar scientific support services?
Cost-plus award fee (CPAF) contracts are often used for complex research, development, or services where the scope is not precisely defined at the outset, or where performance incentives are critical. Unlike fixed-price contracts, CPAF allows the contractor to recover allowable costs plus a base fee, with an additional award fee determined by the government based on performance against specific criteria. This contrasts with cost-plus-incentive-fee (CPIF) contracts, which have more formulaic adjustments to profit based on cost and performance targets. Firm-fixed-price (FFP) contracts offer the most cost certainty but are less suitable for R&D where outcomes are uncertain. For scientific support services like those at Oak Ridge, CPAF is a common choice when the government wants to incentivize high performance and innovation while managing cost uncertainty, though it requires robust government oversight to ensure value.
What are the key performance indicators (KPIs) used to determine the award fee for Oak Ridge Associated Universities, Inc.?
The specific Key Performance Indicators (KPIs) used to determine the award fee for Oak Ridge Associated Universities, Inc. (ORAU) under this contract are not publicly detailed in the provided data. Typically, for a contract of this nature supporting the Oak Ridge Institute for Science and Education (ORISE), KPIs would likely focus on areas such as the successful execution of research projects, adherence to scientific standards, timely delivery of reports and findings, effective management of personnel and resources, contributions to scientific advancement, and overall program effectiveness. The government contracting officer would establish a performance evaluation plan outlining these metrics and their associated weighting. ORAU's performance against these metrics would then be assessed, leading to the determination of the award fee amount, which is intended to reward exceptional performance beyond basic requirements.
What is the track record of Oak Ridge Associated Universities, Inc. in managing large federal science support contracts?
Oak Ridge Associated Universities, Inc. (ORAU) has a long-standing and extensive track record in managing large federal science support contracts, particularly those related to the Department of Energy (DOE) and its national laboratories. ORAU has been instrumental in managing ORISE for decades, demonstrating sustained capability in scientific research administration, workforce development, and technical support. Their experience includes managing complex research programs, facilitating scientific collaborations, and administering educational initiatives. This history suggests a deep understanding of the scientific community's needs and the operational requirements of government-funded research institutions. Their continued success in securing and performing on significant contracts like this one indicates a strong reputation for reliability, expertise, and effective program management within the federal science sector.
Are there any known risks associated with the sole-source nature of the award, despite being competed initially?
While the contract was initially awarded under 'full and open competition,' the data indicates a single awardee, Oak Ridge Associated Universities, Inc. (ORAU). This means that for the duration of this specific contract vehicle, ORAU is the sole provider of these services. The risk associated with this 'sole-source' execution (even if competed initially) is primarily related to potential lack of ongoing competitive pressure on price and innovation throughout the contract's life. If ORAU were to face significant operational issues, or if market conditions changed drastically, the government might be limited in its immediate options without potentially initiating a new, lengthy procurement. However, the initial competition mitigates the risk of selecting an underqualified contractor. The long-term risk is managed through robust contract oversight and performance management by the Department of Energy.
What is the potential economic impact of this $3 billion contract on the Oak Ridge, Tennessee region?
A contract of this magnitude, valued at over $3 billion, has a substantial positive economic impact on the Oak Ridge, Tennessee region. It directly supports the operations of the Oak Ridge Institute for Science and Education (ORISE), which is a significant employer in the area. The contract sustains jobs for a large number of highly skilled personnel, including scientists, researchers, technicians, and administrative staff. Furthermore, it generates indirect economic benefits through local procurement of goods and services, increased consumer spending by employees, and potential growth in related support industries. The presence of such a large federal contract also enhances the region's reputation as a hub for scientific research and development, potentially attracting further investment and talent.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services
Product/Service Code: EDUCATION AND TRAINING › EDUCATION AND TRAINING SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: DE-SOL-0006320
Offers Received: 2
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Address: 100 ORAU WAY, OAK RIDGE, TN, 37830
Business Categories: Category Business, Corporate Entity Tax Exempt, Foundation, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $3,512,632,891
Exercised Options: $3,512,632,891
Current Obligation: $3,022,479,603
Actual Outlays: $1,688,288,180
Subaward Activity
Number of Subawards: 19
Total Subaward Amount: $2,477,931
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2016-03-10
Current End Date: 2026-09-30
Potential End Date: 2026-09-30 00:00:00
Last Modified: 2026-04-08
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