DoD's $59M R&D contract for technology integration awarded to Booz Allen Hamilton, with 2 years remaining

Contract Overview

Contract Amount: $59,255,473 ($59.3M)

Contractor: Booz Allen Hamilton Inc

Awarding Agency: Department of Defense

Start Date: 2021-07-16

End Date: 2026-07-18

Contract Duration: 1,828 days

Daily Burn Rate: $32.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: TECHNOLOGY INTEGRATION AND ASSESSMENT- PHASE I RESEARCH AND DEVELOPMENT FOR UNITED STATES NORTHERN COMMAND & NORTH AMERICAN AEROSPACE DEFENSE COMMAND

Place of Performance

Location: COLORADO SPRINGS, EL PASO County, COLORADO, 80914

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $59.3 million to BOOZ ALLEN HAMILTON INC for work described as: TECHNOLOGY INTEGRATION AND ASSESSMENT- PHASE I RESEARCH AND DEVELOPMENT FOR UNITED STATES NORTHERN COMMAND & NORTH AMERICAN AEROSPACE DEFENSE COMMAND Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. Research and Development focus in physical, engineering, and life sciences indicates a need for advanced technological solutions. 3. The contract's duration of 1828 days (approx. 5 years) suggests a significant, long-term project. 4. Awarded by the Department of the Air Force for NORTHCOM & NORAD, highlighting its strategic importance. 5. The Cost Plus Fixed Fee (CPFF) pricing structure may lead to cost overruns if not carefully managed. 6. No small business set-aside indicates the primary contractor is not a small business, and subcontracting opportunities are not guaranteed.

Value Assessment

Rating: fair

Benchmarking the value of this R&D contract is challenging due to its specialized nature and the lack of direct public comparisons for similar 'Technology Integration and Assessment' phases. The CPFF structure introduces inherent risk for cost control, as the final price is not fixed upfront. While the awarded amount is substantial, its true value will depend on the successful development and integration of the technologies researched.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of multiple bidders (implied by 'full and open') typically fosters price discovery and can lead to more competitive pricing. However, specific details on the number of bids received are not provided, which would offer a clearer picture of the competitive intensity.

Taxpayer Impact: Full and open competition generally benefits taxpayers by encouraging a wider range of solutions and potentially driving down costs through market forces.

Public Impact

The United States Northern Command (NORTHCOM) and North American Aerospace Defense Command (NORAD) are the primary beneficiaries, receiving advanced technology integration and assessment capabilities. Services delivered include research and development aimed at enhancing technological readiness and operational effectiveness for critical defense missions. The geographic impact is national, focusing on the defense of North America. Workforce implications may include the need for highly skilled researchers, engineers, and analysts within the contractor's organization and potentially within the government oversight teams.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type can incentivize contractor to increase costs to maximize profit, requiring robust oversight.
Long contract duration (over 5 years) increases the risk of scope creep or evolving requirements not being adequately managed.
R&D contracts are inherently uncertain; the successful outcome and practical application of the research are not guaranteed.
Lack of small business participation noted, potentially limiting opportunities for smaller innovative firms in the defense technology sector.

Positive Signals

Awarded through full and open competition, suggesting a robust and fair selection process.
Focus on R&D for critical defense commands (NORTHCOM/NORAD) indicates a strategic investment in national security.
Booz Allen Hamilton is a well-established contractor with significant experience in government technology services.
The contract aims to improve technology integration, which is crucial for modern defense capabilities.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. This is a critical area for defense modernization, where significant government spending is directed towards maintaining a technological edge. The market for defense R&D services is highly competitive, with major contractors vying for contracts that promise innovation and strategic advantage. Comparable spending benchmarks are difficult to establish precisely due to the unique nature of 'technology integration and assessment' R&D, but overall federal R&D spending in this broad category runs into billions annually.

Small Business Impact

This contract does not appear to have a small business set-aside, as indicated by 'sb': false. Booz Allen Hamilton is a large business, and there is no explicit requirement for subcontracting with small businesses mentioned. This means that opportunities for small businesses to participate in this specific contract may be limited unless they are sought out by the prime contractor as part of their supply chain, which is not mandated here.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Air Force, given their role as the awarding agency. The CPFF structure necessitates close monitoring of costs and performance to ensure value for money and prevent overruns. Accountability measures would typically involve regular progress reports, milestone reviews, and performance evaluations. Transparency is generally maintained through contract award databases, but detailed project specifics and oversight reports are often not publicly disclosed for national security reasons. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

NORTHCOM Technology Modernization Programs
NORAD Command and Control Systems R&D
Department of Defense Research and Development Contracts
Advanced Technology Integration Services
Aerospace Defense Technology Research

Risk Flags

Cost Overrun Risk (CPFF)
Performance Uncertainty (R&D)
Long Contract Duration
Potential for Scope Creep

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $59.3 million to BOOZ ALLEN HAMILTON INC. TECHNOLOGY INTEGRATION AND ASSESSMENT- PHASE I RESEARCH AND DEVELOPMENT FOR UNITED STATES NORTHERN COMMAND & NORTH AMERICAN AEROSPACE DEFENSE COMMAND

Who is the contractor on this award?

The obligated recipient is BOOZ ALLEN HAMILTON 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 $59.3 million.

What is the period of performance?

Start: 2021-07-16. End: 2026-07-18.

What is Booz Allen Hamilton's track record with similar R&D contracts for defense agencies?

Booz Allen Hamilton has a long and extensive history of performing research and development and technology integration services for various U.S. federal agencies, including the Department of Defense. They have been awarded numerous contracts in areas such as systems engineering, cybersecurity, artificial intelligence, and advanced analytics. Their track record includes supporting complex defense initiatives, often involving large-scale R&D efforts. While specific performance metrics for past R&D contracts are not publicly detailed in this context, their consistent award of significant contracts suggests a generally positive performance history and strong capabilities in meeting government requirements for technological advancement and integration.

How does the $59.2 million value compare to similar R&D contracts for technology integration?

The $59.2 million value for this 5-year R&D contract for technology integration is substantial but falls within a common range for large-scale, specialized defense research projects. Contracts of this nature, especially those involving advanced technology assessment for critical commands like NORTHCOM and NORAD, often require significant investment over extended periods. While direct comparisons are difficult due to the unique scope of 'technology integration and assessment,' other federal R&D contracts in areas like AI, cybersecurity, or advanced materials can range from tens to hundreds of millions of dollars. The value appears commensurate with the strategic importance and complexity of the research objectives.

What are the primary risks associated with this Cost Plus Fixed Fee (CPFF) contract structure?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract is that the contractor is reimbursed for all allowable costs plus a fixed fee representing profit. This structure can incentivize the contractor to incur higher costs, as their profit margin remains constant regardless of the total expenditure. This necessitates rigorous government oversight to scrutinize costs, ensure efficiency, and prevent unnecessary spending. If costs escalate significantly, the total contract value could exceed initial projections, potentially impacting the overall budget. Effective management and clear definition of work are crucial to mitigate these risks.

How effective is the 'full and open competition' approach likely to be in ensuring value for money for this specific R&D effort?

The 'full and open competition' approach is generally considered the most effective method for ensuring value for money in government contracting, as it allows the widest possible pool of qualified vendors to compete. For this R&D effort, it means that multiple companies could propose innovative solutions and competitive pricing. However, the effectiveness in R&D can be nuanced. While competition drives price awareness, the most innovative or technically superior solution might not always be the lowest cost. The government must carefully balance technical merit against cost during evaluation. The success in achieving value for money will depend on the clarity of the solicitation, the evaluation criteria, and the government's ability to assess the long-term potential of the proposed R&D.

What are the historical spending patterns for technology integration R&D by NORTHCOM/NORAD or similar defense entities?

Historical spending patterns for technology integration R&D by NORTHCOM/NORAD and similar defense entities show a consistent and increasing trend over the past decade. As threats evolve and technology advances rapidly, defense commands prioritize investments in integrating new capabilities to maintain situational awareness and operational superiority. Spending in this area often fluctuates based on specific modernization initiatives, emerging technological breakthroughs (like AI, quantum computing, advanced sensors), and geopolitical priorities. While precise historical figures for NORTHCOM/NORAD's technology integration R&D are not readily available in the public domain, the Department of Defense as a whole allocates billions annually to R&D, with a significant portion dedicated to integrating and assessing new technologies across various domains, including command and control, intelligence, and communications.

What are the potential performance risks if the contractor, Booz Allen Hamilton, fails to deliver on the R&D objectives?

If Booz Allen Hamilton fails to deliver on the R&D objectives, the primary performance risk is that NORTHCOM and NORAD will not receive the anticipated technological advancements needed to enhance their operational capabilities. This could lead to a continued reliance on outdated systems, a gap in critical defense functions, or a failure to keep pace with adversary technological developments. Contractually, the government has recourse, which could include withholding payment, terminating the contract for default, or seeking damages. However, the most significant impact is the delay or failure to achieve strategic defense goals, potentially compromising national security. The CPFF structure might also mean that significant funds have been expended with little to show for it.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Booz Allen Hamilton Holding Corporation

Address: 8283 GREENSBORO DR, MCLEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $59,345,728

Exercised Options: $59,345,728

Current Obligation: $59,255,473

Actual Outlays: $14,802,576

Subaward Activity

Number of Subawards: 18

Total Subaward Amount: $22,071,304

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA807518D0004

IDV Type: IDC

Timeline