DoD's $335M Raytheon Contract for R&D: A Decade of Research with Limited Competition

Contract Overview

Contract Amount: $33,515,224 ($33.5M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2006-03-09

End Date: 2016-03-31

Contract Duration: 3,675 days

Daily Burn Rate: $9.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Place of Performance

Location: MARLBOROUGH, MIDDLESEX County, MASSACHUSETTS, 01752

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $33.5 million to RAYTHEON COMPANY for work described as: Key points: 1. Significant investment in R&D, totaling $335 million over 10 years. 2. Sole-source award to Raytheon Company indicates a lack of competitive bidding. 3. Potential for cost overruns due to Cost Plus Fixed Fee contract type. 4. Research and Development in Physical, Engineering, and Life Sciences sector.

Value Assessment

Rating: questionable

The Cost Plus Fixed Fee contract type, while common for R&D, can lead to higher costs if not managed tightly. The lack of competition makes it difficult to benchmark pricing against similar contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, suggesting a sole-source award to Raytheon. This limits price discovery and potentially leads to higher costs for taxpayers.

Taxpayer Impact: The absence of competition likely resulted in a higher price than could have been achieved through a competitive process.

Public Impact

Long-term R&D investment potentially yielding advanced technologies. Taxpayers funded a decade of research without competitive pricing. Lack of transparency in cost justification due to sole-source nature.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Cost-plus contract type
Long contract duration
Lack of small business participation

Positive Signals

Significant R&D investment
Potential for technological advancement

Sector Analysis

This contract falls under Research and Development in the Physical, Engineering, and Life Sciences. Spending in this sector is crucial for innovation but requires careful oversight to ensure value for money.

Small Business Impact

The data indicates no small business participation in this contract, which is a missed opportunity for economic development and potentially limits the diversity of innovation.

Oversight & Accountability

The sole-source nature of this contract raises questions about oversight and whether the government adequately ensured fair and reasonable pricing throughout its duration.

Related Government Programs

Research and Development in the Physical, Engineering, and Life Sciences
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Lack of competition may have inflated costs.
Cost-plus contract type increases risk of overspending.
Long duration without clear competitive benchmarks.
No reported small business participation.
Limited transparency on specific R&D outcomes.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.5 million to RAYTHEON COMPANY. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

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 $33.5 million.

What is the period of performance?

Start: 2006-03-09. End: 2016-03-31.

What specific technological advancements or outcomes resulted from this $335 million investment over ten years?

Without detailed reporting on deliverables and milestones, it's challenging to ascertain the specific technological advancements or outcomes. The contract's focus on R&D suggests potential for innovation in physical, engineering, or life sciences, but the value realized depends heavily on the project's success and the government's utilization of the developed technologies.

How was the 'fixed fee' determined in this Cost Plus Fixed Fee contract, and was it justified given the lack of competition?

The determination of the fixed fee in a Cost Plus Fixed Fee contract typically involves negotiation based on anticipated costs, desired profit margin, and the complexity of the work. For a sole-source award, the government must still demonstrate that the fee is fair and reasonable, often through cost analysis and comparison to similar historical contracts, though this is more challenging without competitive benchmarks.

What mechanisms were in place to ensure accountability and prevent cost overruns in this decade-long, sole-source R&D contract?

Accountability in such contracts relies on robust government oversight, including regular progress reviews, audits, and strict adherence to contract clauses. Mechanisms to prevent cost overruns would involve detailed cost tracking, performance metrics, and potential limitations on cost increases. The effectiveness of these mechanisms is crucial, especially given the inherent risks of R&D and the absence of competitive pressure.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1001 BOSTON POST RD E, MARLBOROUGH, MA, 01752

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

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline