Commerce Department's $19.8M R&D contract for technical services awarded to Tecolote Research, Inc

Contract Overview

Contract Amount: $19,835,891 ($19.8M)

Contractor: Tecolote Research, Inc.

Awarding Agency: Department of Commerce

Start Date: 2008-06-19

End Date: 2013-06-18

Contract Duration: 1,825 days

Daily Burn Rate: $10.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: COST, SCHEDULE AND EARNED VALUE TECHNICAL SERVICES

Place of Performance

Location: SILVER SPRING, MONTGOMERY County, MARYLAND, 20910

State: Maryland Government Spending

Plain-Language Summary

Department of Commerce obligated $19.8 million to TECOLOTE RESEARCH, INC. for work described as: COST, SCHEDULE AND EARNED VALUE TECHNICAL SERVICES Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can incentivize cost control but also carries risk if not managed closely. 3. The duration of 1825 days (5 years) indicates a long-term need for these technical services. 4. The North American Industry Classification System (NAICS) code 541712 points to significant investment in physical, engineering, and life sciences R&D. 5. The contract was awarded to a single entity, Tecolote Research, Inc., highlighting their specialized capabilities. 6. The base award amount is over $10 million, signifying a substantial commitment of federal funds.

Value Assessment

Rating: fair

The base award of $10,869,000 for 5 years of Cost Plus Fixed Fee services requires careful scrutiny. Without comparable contract data for similar R&D technical services, it's difficult to definitively benchmark value. The fixed fee component suggests some level of cost certainty for the government, but the cost-reimbursement aspect means actual spending could exceed the base award. Further analysis would involve comparing the contractor's proposed fixed fee and overhead rates against industry standards and the scope of work.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders were likely solicited and evaluated. The presence of 7 bidders suggests a healthy level of interest and competition for this type of specialized R&D support. This competitive environment generally benefits the government by driving down prices and encouraging innovation among offerors.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by selecting the most cost-effective and technically capable solution.

Public Impact

The primary beneficiaries are likely the National Oceanic and Atmospheric Administration (NOAA) and its research initiatives, which receive critical technical support. The services delivered are essential for advancing research and development in physical, engineering, and life sciences. The contract's impact is primarily national, supporting federal scientific endeavors. The contract supports specialized technical and research roles within the contractor's workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can lead to cost overruns if not rigorously managed and monitored.
The long duration of the contract may reduce flexibility to adapt to changing research needs or technological advancements.
Reliance on a single contractor for critical technical services could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, indicating a robust selection process.
The contractor, Tecolote Research, Inc., has secured a significant federal contract, suggesting established expertise.
The fixed fee component provides a degree of cost predictability for the government.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically NAICS code 541712, which covers R&D in physical, engineering, and life sciences (excluding biotechnology). This is a critical area for federal investment, supporting scientific advancement and technological innovation. Comparable spending in this sector often involves significant investments in specialized research services, often through long-term contracts with firms possessing unique expertise. The market for such services is competitive, with a mix of large and small firms vying for government contracts.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, the primary impact on small businesses would be through potential subcontracting opportunities, if any are offered by the prime contractor, Tecolote Research, Inc. Without specific subcontracting plans detailed in the award, it's difficult to assess the direct impact on the small business ecosystem. However, the full and open competition suggests larger, established firms were likely the primary bidders.

Oversight & Accountability

Oversight for this contract would typically be managed by the National Oceanic and Atmospheric Administration (NOAA) contracting officers and program managers. The Cost Plus Fixed Fee structure necessitates close monitoring of costs incurred and the achievement of milestones to ensure the fixed fee is earned appropriately. Transparency is generally maintained through contract reporting requirements and potential reviews by the Department of Commerce's Office of Inspector General, particularly concerning financial accountability and performance.

Related Government Programs

Federal R&D Spending
Scientific and Technical Services Contracts
National Oceanic and Atmospheric Administration Contracts
Department of Commerce Contracts
Cost Plus Fixed Fee Contracts

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage costs.
Long contract duration may limit flexibility.
Potential for cost overruns inherent in cost-reimbursement contracts.

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $19.8 million to TECOLOTE RESEARCH, INC.. COST, SCHEDULE AND EARNED VALUE TECHNICAL SERVICES

Who is the contractor on this award?

The obligated recipient is TECOLOTE RESEARCH, INC..

Which agency awarded this contract?

Awarding agency: Department of Commerce (National Oceanic and Atmospheric Administration).

What is the total obligated amount?

The obligated amount is $19.8 million.

What is the period of performance?

Start: 2008-06-19. End: 2013-06-18.

What is the track record of Tecolote Research, Inc. in performing similar government contracts, particularly Cost Plus Fixed Fee R&D services?

Tecolote Research, Inc. has a history of securing and performing on federal contracts, often in specialized technical and engineering support roles. Their experience with Cost Plus Fixed Fee (CPFF) contracts is relevant, as this contract type requires careful management of costs against a predetermined fixed fee. Analyzing their past performance on similar CPFF contracts, including any reported issues with cost overruns, schedule delays, or performance deficiencies, would provide crucial insight into their capability to execute this specific award effectively. A review of their contract history, including contract closeouts and any associated audits or disputes, would be necessary for a comprehensive assessment of their reliability and value proposition.

How does the awarded amount of approximately $10.87 million for the base period compare to similar R&D technical services contracts awarded by NOAA or other agencies?

Benchmarking the base award of $10,869,000 against comparable contracts is essential for assessing value. Without specific data on the scope of work, duration, and complexity of other R&D technical services contracts, a precise comparison is challenging. However, for a 5-year contract (1825 days) involving specialized R&D support, this amount suggests a significant but potentially reasonable investment, especially if the services are highly specialized or critical to NOAA's mission. A detailed analysis would involve identifying contracts with similar NAICS codes (541712), contract types (CPFF), and agencies, then normalizing for contract duration and scope to determine if the per-year cost is within market norms.

What are the primary risks associated with a Cost Plus Fixed Fee contract for R&D technical services, and how are they mitigated in this award?

The primary risks of a Cost Plus Fixed Fee (CPFF) contract include potential cost overruns if the contractor's actual costs exceed estimates, and the contractor may have less incentive to control costs compared to fixed-price contracts, as their fee is fixed regardless of actual costs. For R&D technical services, there's also the risk that the research outcomes may not meet expectations. Mitigation strategies in this award likely involve rigorous oversight by NOAA, detailed cost accounting standards, milestone-based payments tied to deliverables, and clear performance metrics. The fixed fee itself provides some incentive for efficiency, as the contractor bears the risk of costs exceeding the estimate without additional reimbursement. Effective contract management and communication are crucial for mitigating these risks.

What is the expected impact of this contract on NOAA's research and development capabilities in physical, engineering, and life sciences?

This contract is expected to significantly bolster NOAA's R&D capabilities by providing specialized technical services essential for its scientific mission. The support from Tecolote Research, Inc. under NAICS code 541712 suggests a focus on advancing knowledge and technology in areas critical to NOAA's mandate, such as climate science, weather forecasting, oceanography, and environmental research. By outsourcing these technical services, NOAA can leverage external expertise, potentially accelerating research timelines, enhancing the quality of scientific output, and allowing its internal scientific staff to focus on core research objectives. The long-term nature of the contract indicates a sustained need for this support, implying a strategic investment in maintaining and advancing NOAA's scientific infrastructure and output.

How does the number of bidders (7) in this full and open competition reflect the market for specialized R&D technical services?

The fact that seven bidders participated in this full and open competition suggests a moderately competitive market for specialized R&D technical services within the physical, engineering, and life sciences domain. While not an exceptionally large number, it indicates that multiple firms possess the necessary qualifications and capacity to compete for such contracts. This level of competition is generally sufficient to encourage fair pricing and a range of technical approaches. A higher number of bidders might indicate a more robust or accessible market, while fewer bidders could suggest a more niche or consolidated industry. The government's ability to select from seven qualified proposals implies a reasonable degree of choice and potential for achieving good value.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: DG133E08RP0015

Offers Received: 7

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1 S LOS CARNEROS RD, SUITE 125, GOLETA, CA, 93117

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $19,835,891

Exercised Options: $19,835,891

Current Obligation: $19,835,891

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline