DoD awards $33.9M engineering contract to Georgia Tech Applied Research Corp for essential research

Contract Overview

Contract Amount: $33,901,494 ($33.9M)

Contractor: Georgia Tech Applied Research Corp

Awarding Agency: Department of Defense

Start Date: 2023-06-12

End Date: 2026-09-28

Contract Duration: 1,204 days

Daily Burn Rate: $28.2K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ESSENTIAL ENGINEERING AND RESEARCH CAPABILITY - BAND 8

Place of Performance

Location: ATLANTA, FULTON County, GEORGIA, 30318

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $33.9 million to GEORGIA TECH APPLIED RESEARCH CORP for work described as: ESSENTIAL ENGINEERING AND RESEARCH CAPABILITY - BAND 8 Key points: 1. Contract awarded for specialized engineering and research capabilities, indicating a need for advanced technical expertise. 2. The awardee, Georgia Tech Applied Research Corp, suggests a focus on academic-industry partnerships for defense innovation. 3. A long performance period of 1204 days points to a sustained need for the services provided. 4. The contract type, Cost Plus Fixed Fee, allows for flexibility but requires careful oversight to manage costs. 5. The absence of small business participation raises questions about broader economic impact. 6. The contract's geographic focus is Georgia, potentially benefiting the local tech and research ecosystem.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific service details or comparable contracts. The Cost Plus Fixed Fee structure can lead to cost overruns if not managed diligently. However, given the specialized nature of 'ESSENTIAL ENGINEERING AND RESEARCH CAPABILITY - BAND 8', the price may reflect unique expertise and resources. Further analysis would require understanding the specific deliverables and the market rate for such advanced engineering services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when a specific contractor possesses unique capabilities or when urgency dictates a rapid award. The lack of competition means that price discovery through market forces was bypassed, potentially leading to higher costs for the government.

Taxpayer Impact: Sole-source awards limit opportunities for other businesses to compete for government contracts and may result in taxpayers paying a premium for services that could potentially be obtained at a lower cost through a competitive process.

Public Impact

The primary beneficiary is the Department of Defense, specifically the Air Force, which will receive essential engineering and research capabilities. The contract supports advanced research and development, contributing to national security and technological superiority. The geographic impact is concentrated in Georgia, potentially fostering local economic development and job creation within the research sector. The contract may indirectly benefit the scientific and engineering workforce by supporting specialized research roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost Plus Fixed Fee contract type requires robust oversight to prevent cost escalation.
No small business participation noted, limiting broader economic benefits.
Specialized nature of 'BAND 8' capabilities makes direct cost comparison difficult.

Positive Signals

Award to a research institution like Georgia Tech suggests access to cutting-edge expertise.
Long contract duration indicates a critical and ongoing need for these services.
Focus on essential engineering and research aligns with strategic defense priorities.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the broader Defense industry. The market for specialized engineering and research capabilities is often characterized by high barriers to entry due to the need for advanced technical expertise, specialized equipment, and security clearances. Spending in this area is driven by the government's need for innovation and support for complex defense systems. Comparable spending benchmarks would typically involve other large-scale R&D or engineering support contracts awarded by defense agencies.

Small Business Impact

This contract was not set aside for small businesses, and the awardee is not a small business. This indicates that the specific requirements were likely deemed to necessitate capabilities beyond those typically offered by small businesses, or that the procurement strategy did not prioritize small business participation. Consequently, there are no direct subcontracting implications for small businesses stemming from this award, potentially limiting their engagement in this specific project.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract would primarily fall under the Department of the Air Force's contracting and program management offices. Accountability measures would involve regular performance reviews, cost tracking, and adherence to the fixed fee. Transparency is generally maintained through contract databases, though specific performance details may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Research and Development Contracts
Air Force Engineering Support Services
University Research Partnerships
Advanced Technology Development

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Lack of small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.9 million to GEORGIA TECH APPLIED RESEARCH CORP. ESSENTIAL ENGINEERING AND RESEARCH CAPABILITY - BAND 8

Who is the contractor on this award?

The obligated recipient is GEORGIA TECH APPLIED RESEARCH CORP.

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 $33.9 million.

What is the period of performance?

Start: 2023-06-12. End: 2026-09-28.

What specific engineering and research capabilities are encompassed by 'ESSENTIAL ENGINEERING AND RESEARCH CAPABILITY - BAND 8'?

The designation 'ESSENTIAL ENGINEERING AND RESEARCH CAPABILITY - BAND 8' suggests a high level of specialized technical expertise and support required by the Department of Defense. While the exact scope is not detailed in the provided data, 'Band 8' typically signifies advanced, complex, and critical functions. This could include areas such as systems engineering, advanced materials research, complex simulation and modeling, cybersecurity research, or specialized aerospace engineering. These capabilities are crucial for maintaining technological superiority and addressing evolving national security threats. The 'essential' nature implies these services are fundamental to the Air Force's mission objectives and cannot be easily substituted or deferred.

How does the Cost Plus Fixed Fee (CPFF) contract type typically function, and what are its implications for this contract?

A Cost Plus Fixed Fee (CPFF) contract is a type of cost-reimbursement contract where the contractor is reimbursed for all allowable costs incurred, plus a fixed amount of profit (the fee). This structure is often used when the scope of work is not precisely defined or when there is a high degree of uncertainty in the costs. For this contract, it means Georgia Tech Applied Research Corp will be paid for its expenses in performing the engineering and research, plus a predetermined fee. The implication is that the government bears the risk of cost overruns if actual costs exceed estimates, while the contractor has a defined profit margin. Effective oversight is crucial to ensure costs are reasonable and necessary to achieve the contract's objectives.

What is the typical track record of Georgia Tech Applied Research Corp with federal contracts, particularly with the Department of Defense?

Georgia Tech Applied Research Corp (GTARC) is a well-established entity affiliated with the Georgia Institute of Technology, known for its extensive involvement in research and development for government agencies, including the Department of Defense. GTARC frequently secures contracts for advanced scientific and engineering projects, leveraging the academic and research prowess of Georgia Tech. Their track record generally indicates a strong capacity for complex R&D, innovation, and technical problem-solving. While specific performance metrics for individual contracts are not publicly detailed here, their consistent engagement with DoD suggests a history of successful project execution and a reputation for delivering high-quality research outcomes in various defense-related fields.

Given the sole-source nature, what are the potential risks to the government in terms of cost and performance?

The primary risk to the government in a sole-source award is the potential for inflated costs due to the lack of competitive pressure. Without competing bids, the government may not achieve the most favorable pricing. Performance risks can also be elevated if the sole-source provider lacks sufficient motivation to excel beyond contractual minimums, as there are no competitors to outperform. Furthermore, if the contractor encounters unforeseen challenges, the government might have limited recourse or leverage compared to a situation with multiple potential providers. Robust contract management, clear performance metrics, and diligent oversight are therefore critical to mitigate these risks.

How does this contract align with broader trends in federal R&D spending and defense modernization?

This contract aligns with the broader federal trend of investing in advanced research and development to maintain technological superiority, particularly within the defense sector. As geopolitical landscapes evolve, agencies like the Department of Defense prioritize funding for cutting-edge capabilities that can address emerging threats and enhance operational effectiveness. Contracts awarded to research institutions like Georgia Tech underscore the government's strategy of tapping into academic innovation for defense modernization. This specific award for 'essential engineering and research capability' suggests a focus on foundational or critical technologies that underpin future defense systems, reflecting a commitment to long-term strategic advantage through sustained R&D investment.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: FA852323R0002

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 505 10TH ST, ATLANTA, GA, 30318

Business Categories: Category Business, Corporate Entity Tax Exempt, Educational Institution, Higher Education, Nonprofit Organization, Not Designated a Small Business, Higher Education (Public), Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $35,400,003

Exercised Options: $33,901,494

Current Obligation: $33,901,494

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $25,014,040

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA852319D0006

IDV Type: IDC

Timeline