DoD's $170.5M R&D contract for Armament Mission Area Test Enterprise awarded to Torch Technologies Inc

Contract Overview

Contract Amount: $170,525,535 ($170.5M)

Contractor: Torch Technologies Inc

Awarding Agency: Department of Defense

Start Date: 2016-04-07

End Date: 2020-09-30

Contract Duration: 1,637 days

Daily Burn Rate: $104.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 6

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: IGF::OT::IGF TECHNICAL AND MANAGEMENT ADVISORY SERVICES (TMAS) FOR THE ARMAMENT MISSION AREA TEST ENTERPRISE

Place of Performance

Location: EGLIN AFB, OKALOOSA County, FLORIDA, 32542

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $170.5 million to TORCH TECHNOLOGIES INC for work described as: IGF::OT::IGF TECHNICAL AND MANAGEMENT ADVISORY SERVICES (TMAS) FOR THE ARMAMENT MISSION AREA TEST ENTERPRISE Key points: 1. Contract awarded through full and open competition, indicating a robust bidding process. 2. The contract's duration of over 4 years suggests a significant, long-term need for these services. 3. The cost-plus-fixed-fee pricing structure may incentivize contractor efficiency while managing risk. 4. The specialized nature of armament test enterprise services points to a niche but critical defense capability. 5. Performance context is crucial given the R&D focus, requiring careful monitoring of milestones and deliverables.

Value Assessment

Rating: good

Benchmarking the value of this specific R&D contract is challenging due to its specialized nature and the lack of directly comparable public data. However, the contract's total value of approximately $170.5 million over four years suggests a substantial investment in critical defense capabilities. The cost-plus-fixed-fee (CPFF) structure, while common in R&D, requires careful oversight to ensure cost control and prevent overruns. Without specific performance metrics or detailed cost breakdowns, a definitive value-for-money assessment is difficult, but the competitive award process provides some assurance of fair pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which implies that while initial solicitations might have had exclusions, the final award was made after a broad competitive process. The presence of 6 bidders indicates a healthy level of competition for this specialized R&D service. This competitive environment is generally favorable for price discovery and ensures that the government receives proposals from multiple qualified entities, potentially leading to better terms and innovation.

Taxpayer Impact: The robust competition suggests that taxpayer funds were likely used efficiently, as multiple companies vied to offer their best technical solutions and pricing. This process helps prevent single-source price inflation and encourages cost-effectiveness.

Public Impact

The primary beneficiaries are the Department of Defense and its various branches, particularly those involved in armament development and testing. Services delivered include technical and management advisory support for the Armament Mission Area Test Enterprise. The geographic impact is likely concentrated around defense testing facilities and contractor locations, primarily in Florida. Workforce implications include employment for highly skilled engineers, scientists, and technical management professionals in the defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Fixed Fee contracts for R&D projects.
Ensuring continued innovation and technical advancement throughout the contract's duration.
Managing the complexity of coordinating advisory services across a broad armament test enterprise.

Positive Signals

Awarded through full and open competition, suggesting a fair and competitive process.
Multiple bidders (6) indicate a healthy market for these specialized services.
Long contract duration (over 4 years) suggests a stable and ongoing need for critical defense support.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences, excluding biotechnology. The market for defense R&D is characterized by high barriers to entry, specialized expertise, and significant government investment. Contracts like this are crucial for maintaining technological superiority in defense capabilities. Comparable spending benchmarks are difficult to establish due to the niche nature of armament testing, but overall DoD R&D spending runs into the tens of billions annually.

Small Business Impact

The data indicates that small business participation was not a primary set-aside consideration for this contract (ss: false, sb: false). While the prime contractor, Torch Technologies Inc., may be a large business, the contract's nature as a specialized R&D service might limit direct subcontracting opportunities for small businesses unless they possess highly specific technical capabilities. Further analysis would be needed to determine if any small business subcontracting plans were mandated or voluntarily pursued.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting agency (Department of the Air Force) through program managers and contract specialists. The cost-plus-fixed-fee structure necessitates rigorous financial oversight to monitor expenditures and ensure compliance with the fixed fee. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

DoD Research and Development Programs
Armament Systems Development
Test and Evaluation Services
Defense Technology Innovation

Risk Flags

Cost Overrun Potential (CPFF)
Technical Feasibility Risk (R&D)
Schedule Slippage Risk
Evolving Threat Landscape Impacting R&D Focus

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $170.5 million to TORCH TECHNOLOGIES INC. IGF::OT::IGF TECHNICAL AND MANAGEMENT ADVISORY SERVICES (TMAS) FOR THE ARMAMENT MISSION AREA TEST ENTERPRISE

Who is the contractor on this award?

The obligated recipient is TORCH TECHNOLOGIES INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $170.5 million.

What is the period of performance?

Start: 2016-04-07. End: 2020-09-30.

What is the track record of Torch Technologies Inc. with similar government contracts?

Torch Technologies Inc. has a history of securing contracts with the Department of Defense, primarily in research and development, engineering services, and technical support. Their portfolio often includes work related to aviation, missile systems, and other defense technologies. Analyzing their past performance on similar Cost Plus Fixed Fee (CPFF) contracts would be crucial to assess their ability to manage costs effectively and deliver on complex R&D objectives. A review of past performance evaluations and any contract modifications or disputes would provide further insight into their reliability and competence in executing large-scale defense projects.

How does the pricing structure (CPFF) compare to other R&D contracts of similar scope?

The Cost Plus Fixed Fee (CPFF) pricing structure is common for research and development contracts where the scope of work can be uncertain or evolve significantly. It allows the contractor to recover allowable costs plus a predetermined fixed fee representing profit. Compared to fixed-price contracts, CPFF offers more flexibility for the government if requirements change but carries a higher risk of cost overruns if not managed diligently. For R&D of this magnitude, CPFF is often preferred to incentivize innovation without the contractor bearing excessive financial risk for unforeseen technical challenges. Benchmarking against other large-scale DoD R&D efforts would reveal if the fixed fee percentage is within industry norms.

What are the key performance indicators (KPIs) used to measure the success of this contract?

Specific Key Performance Indicators (KPIs) for this contract are not detailed in the provided data. However, for R&D contracts of this nature, typical KPIs would likely include adherence to project timelines, achievement of technical milestones, successful completion of test objectives, quality of research findings, and effective management of project costs within the approved budget. The 'Armament Mission Area Test Enterprise' suggests that KPIs would be heavily focused on the efficacy and reliability of armament systems tested or developed under the contract. Regular technical reviews and progress reports would be essential for monitoring these KPIs.

What is the historical spending trend for the Armament Mission Area Test Enterprise?

The provided data focuses on a single contract awarded in 2016. To understand the historical spending trend for the Armament Mission Area Test Enterprise, one would need to analyze contract awards for this specific mission area over several fiscal years. This would involve querying federal procurement databases for all contracts related to armament testing and development, identifying the total obligated amounts, and observing patterns in spending, contractor awards, and contract types. Such an analysis would reveal whether spending has been consistent, increasing, or decreasing, and identify any significant shifts in procurement strategies or technological focus.

Are there any identified risks associated with the contractor's performance or the nature of the R&D work?

Risks associated with this contract can be categorized into contractor performance and the nature of the R&D work. For contractor performance, potential risks include schedule delays, cost overruns (especially with CPFF), and failure to meet technical specifications. The nature of R&D, particularly in armament systems, carries inherent risks such as technological obsolescence, unforeseen scientific challenges, and the potential for research outcomes not meeting desired objectives. The 'full and open competition' aspect mitigates some risk by selecting a capable contractor, but ongoing oversight is critical to manage these inherent uncertainties throughout the contract lifecycle.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 6

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 4090 MEMORIAL PKWY S, HUNTSVILLE, AL, 35802

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

Financial Breakdown

Contract Ceiling: $226,119,307

Exercised Options: $225,725,748

Current Obligation: $170,525,535

Actual Outlays: $7,392,763

Subaward Activity

Number of Subawards: 41

Total Subaward Amount: $1,360,097,493

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q14OADS621

IDV Type: IDC

Timeline