DoD's $311M R&D contract for technical advisory services awarded to Torch Technologies Inc

Contract Overview

Contract Amount: $311,275,702 ($311.3M)

Contractor: Torch Technologies Inc

Awarding Agency: Department of Defense

Start Date: 2022-10-01

End Date: 2026-09-30

Contract Duration: 1,460 days

Daily Burn Rate: $213.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: TECHNICAL AND MANAGEMENT ADVISORY SERVICES (TMAS) 2 TENANTS

Place of Performance

Location: EGLIN AFB, OKALOOSA County, FLORIDA, 32542

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $311.3 million to TORCH TECHNOLOGIES INC for work described as: TECHNICAL AND MANAGEMENT ADVISORY SERVICES (TMAS) 2 TENANTS Key points: 1. Contract awarded through 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 inherent risk. 3. The duration of 1460 days (4 years) indicates a long-term need for these advisory services. 4. The North American Industry Classification System (NAICS) code 541712 points to research and development in physical, engineering, and life sciences. 5. The contract is a delivery order under a larger contract vehicle, implying it's part of a broader acquisition strategy. 6. The contract is not set aside for small businesses, indicating it was open to all eligible large and small businesses. 7. The contract is for technical and management advisory services for two tenants, suggesting specialized support.

Value Assessment

Rating: fair

Benchmarking the value of this Cost Plus Fixed Fee contract is challenging without detailed cost breakdowns and performance metrics. The fixed fee component provides some cost certainty, but the cost-reimbursement nature means actual costs could fluctuate. Comparing this to similar R&D advisory contracts would require access to proprietary pricing data and performance evaluations. The total award amount of over $311 million over four years suggests a significant investment, and its value will ultimately depend on the successful delivery of technical and management advisory services that contribute to the Department of Defense's objectives.

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 indicates a competitive process was initiated, but specific sources may have been excluded based on certain criteria. The presence of four bidders suggests a moderate level of competition. While full and open competition is generally preferred, the exclusion of sources warrants further investigation to ensure it did not unduly limit the competitive landscape and potentially impact price discovery.

Taxpayer Impact: The competitive process, even with exclusions, aims to secure the best value for taxpayers by encouraging multiple firms to offer their best pricing and technical solutions. A moderate number of bidders can lead to reasonable pricing, but a more robust competition might have yielded even better results.

Public Impact

The Department of Defense benefits from specialized technical and management advisory services to support its research and development initiatives. The services delivered are crucial for advancing physical, engineering, and life sciences research, potentially leading to technological advancements. The geographic impact is primarily within Florida, where the contract is managed and potentially where services are rendered. Workforce implications include the potential for highly skilled technical and management professionals to be engaged in critical defense R&D projects.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can lead to cost overruns if not managed diligently.
The exclusion of sources in the 'full and open' competition process needs scrutiny to ensure fairness and optimal value.
The long duration of the contract may present challenges in adapting to evolving technological needs or strategic shifts.

Positive Signals

Awarded through a competitive process, indicating multiple firms vied for the contract.
The contract supports critical R&D in physical, engineering, and life sciences, aligning with national security objectives.
The fixed fee component provides a degree of cost predictability for the government.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The market for technical and management advisory services in defense R&D is highly specialized, often dominated by firms with deep technical expertise and security clearances. Comparable spending benchmarks would typically be found within broader DoD R&D budgets, where significant investments are made annually to maintain technological superiority. The total award of over $311 million over four years represents a substantial commitment to acquiring specialized knowledge and support for critical research endeavors.

Small Business Impact

This contract was not set aside for small businesses, as indicated by the 'ss' and 'sb' fields being false. This means the competition was open to all eligible businesses, including large corporations. While there are no direct subcontracting requirements specified here for small businesses, the prime contractor, Torch Technologies Inc., may choose to engage small businesses as subcontractors if it aligns with their project needs and strategy. The absence of a small business set-aside suggests the primary focus was on securing the most capable provider, regardless of size, for these specialized R&D advisory services.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the Department of the Air Force. Performance monitoring, cost tracking, and adherence to contract terms are key oversight mechanisms. Accountability measures are built into the Cost Plus Fixed Fee structure, where the contractor is reimbursed for allowable costs plus a negotiated fixed fee. Transparency is generally maintained through contract reporting requirements, though detailed cost breakdowns may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Research and Development Programs
Technical Advisory and Management Support Services
Air Force Science and Technology Investments
Physical Sciences Research Contracts
Engineering Services Contracts
Life Sciences Research Support

Risk Flags

Cost Plus Fixed Fee contract type carries inherent risk of cost overruns.
Competition included exclusion of sources, potentially limiting optimal price discovery.
Long contract duration may pose challenges for adapting to evolving needs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $311.3 million to TORCH TECHNOLOGIES INC. TECHNICAL AND MANAGEMENT ADVISORY SERVICES (TMAS) 2 TENANTS

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 $311.3 million.

What is the period of performance?

Start: 2022-10-01. End: 2026-09-30.

What is the track record of Torch Technologies Inc. in delivering similar technical and management advisory services to the Department of Defense?

Torch Technologies Inc. has a history of providing technical and management support services to the Department of Defense. Their experience often includes areas such as systems engineering, test and evaluation, and program management, particularly within aerospace and defense contexts. While specific details on past performance for contracts of this exact scope and value require deeper investigation into contract databases and performance reports, their presence as a prime contractor on significant DoD awards suggests a demonstrated capability. Analyzing past performance reviews, any past performance issues, and the successful completion of prior contracts would provide a more comprehensive understanding of their track record in delivering complex advisory services.

How does the pricing structure (Cost Plus Fixed Fee) compare to other R&D advisory contracts of similar scope and duration?

The Cost Plus Fixed Fee (CPFF) pricing structure is common for research and development contracts where the exact costs are difficult to predict at the outset. In CPFF, the contractor is reimbursed for all allowable costs incurred, plus a fixed fee representing profit. This structure incentivizes the contractor to control costs to maximize their profit margin, as the fee is fixed. Compared to other R&D advisory contracts, CPFF offers a balance between flexibility for the government and cost certainty for the contractor's profit. However, it carries a higher risk of cost growth than fixed-price contracts. Benchmarking requires comparing the fixed fee percentage and the projected cost base against similar contracts awarded by the DoD or other agencies for comparable R&D advisory services.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks for this contract include potential cost overruns due to the Cost Plus Fixed Fee structure, where actual costs could exceed initial estimates. Another risk is the possibility of the contractor not delivering the expected level of technical expertise or management insight, impacting the effectiveness of the R&D initiatives. Furthermore, the 'full and open competition after exclusion of sources' raises a risk related to potentially limiting the competitive pool. Mitigation strategies likely involve robust government oversight, detailed performance metrics, regular progress reviews, and strict adherence to allowable cost principles. The contracting officer and program team would actively monitor performance and costs, and the fixed fee provides a ceiling on profit, indirectly encouraging efficiency.

What is the expected impact of these technical and management advisory services on the Department of Defense's overall R&D effectiveness?

The expected impact is significant, as these services are intended to enhance the effectiveness of the Department of Defense's R&D efforts in physical, engineering, and life sciences. By providing expert technical guidance and management support, the contractor aims to optimize research processes, identify promising technologies, improve project execution, and ensure alignment with strategic objectives. This can lead to faster development cycles, more innovative solutions, better resource allocation, and ultimately, a stronger technological advantage for the DoD. The success of these advisory services is critical for the efficient and impactful advancement of the department's research portfolio.

How does this contract's total value and duration compare to historical spending on similar R&D advisory services within the Air Force?

The total value of approximately $311 million over four years for technical and management advisory services is substantial and indicates a significant investment by the Department of the Air Force in specialized R&D support. To compare this to historical spending, one would need to analyze historical contract databases for similar NAICS codes (e.g., 541712) and service types within the Air Force over previous fiscal years. Factors such as inflation, evolving technological needs, and shifts in R&D priorities would influence historical spending patterns. Without direct access to such historical data, it's difficult to definitively state whether this contract represents an increase or decrease in spending relative to past trends, but its scale suggests a continued commitment to acquiring high-level R&D advisory expertise.

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: 4

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: $786,205,346

Exercised Options: $524,676,499

Current Obligation: $311,275,702

Actual Outlays: $31,336,520

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $3,536,222

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q14OADS737

IDV Type: IDC

Timeline