DoD's $1B R&D Contract with General Atomics: Long Duration, High Cost
Contract Overview
Contract Amount: $10,034,000 ($10.0M)
Contractor: General Atomics
Awarding Agency: Department of Defense
Start Date: 2004-04-30
End Date: 2014-06-30
Contract Duration: 3,713 days
Daily Burn Rate: $2.7K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92121
Plain-Language Summary
Department of Defense obligated $10.0 million to GENERAL ATOMICS for work described as: Key points: 1. Significant investment of over $1 billion in R&D services. 2. Sole-source award to General Atomics raises questions about competition. 3. Long contract duration (2004-2014) may indicate evolving requirements or limited market. 4. Cost-plus-fixed-fee structure can incentivize cost growth. 5. Focus on R&D in physical, engineering, and life sciences.
Value Assessment
Rating: questionable
The contract value of $1,003,400,000 is substantial for R&D services. Without specific deliverables or benchmarks, assessing value is difficult. The cost-plus-fixed-fee (CPFF) pricing structure, while common for R&D, can lead to higher costs compared to fixed-price contracts if not managed tightly.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating a limited competition scenario. This suggests that while some competition may have occurred, it was not fully open, potentially impacting price discovery and leading to higher costs.
Taxpayer Impact: The substantial contract value and limited competition suggest a potentially significant impact on taxpayer funds, warranting scrutiny of the procurement process and cost controls.
Public Impact
Taxpayers funded over $1 billion for research and development over a decade. The contract supported advancements in physical, engineering, and life sciences. General Atomics, a major defense contractor, received the award. The long duration suggests sustained investment in specific R&D areas.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition
- Cost-plus-fixed-fee pricing
- Long contract duration
- High total value
Positive Signals
- Supports critical R&D
- Awarded to established contractor
Sector Analysis
This contract falls under the Research and Development in the Physical, Engineering, and Life Sciences sector (NAICS 541710). Spending in this area is crucial for technological advancement but can be prone to cost overruns due to the inherent uncertainties in R&D.
Small Business Impact
The data indicates this contract was awarded to General Atomics, a large business. There is no indication of small business participation or subcontracting in the provided details.
Oversight & Accountability
The contract was managed by the Defense Contract Management Agency (DCMA), responsible for overseeing contract performance and ensuring compliance. The long duration and CPFF structure would require robust oversight to manage costs and ensure value.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Potential for cost overruns due to CPFF structure.
- Limited competition may have led to higher prices.
- Long contract duration could indicate scope creep or lack of market alternatives.
- Lack of transparency on specific R&D deliverables and outcomes.
- No clear indication of small business participation.
Tags
research-and-development-in-the-physical, department-of-defense, ca, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $10.0 million to GENERAL ATOMICS. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is GENERAL ATOMICS.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $10.0 million.
What is the period of performance?
Start: 2004-04-30. End: 2014-06-30.
What specific R&D outcomes were achieved for the $1 billion investment, and how do they compare to industry benchmarks for similar research efforts?
Assessing the value requires detailed knowledge of the R&D projects undertaken. Without specific deliverables or performance metrics, it's challenging to quantify the return on investment. Comparing outcomes to industry benchmarks would necessitate access to proprietary research data and independent evaluations of technological advancements achieved under the contract.
Given the 'limited competition' award, what justification was provided for excluding other potential sources, and was a thorough market analysis conducted?
The justification for excluding sources under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' typically involves demonstrating that only one or a limited number of sources possess the required capabilities or that full and open competition is not feasible or cost-effective. A thorough market analysis would be crucial to validate these claims and ensure the government obtained the best possible value.
How effectively did the Cost Plus Fixed Fee (CPFF) structure incentivize General Atomics to control costs and deliver R&D efficiently over the 10-year period?
CPFF contracts aim to provide flexibility for R&D while offering the contractor a fixed fee for profit. However, they can incentivize cost escalation if not rigorously monitored. Effective cost control relies heavily on the government's ability to establish realistic cost estimates, monitor expenditures closely, and manage the contractor's performance throughout the contract's lifecycle.
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 › OTHER RESEARCH/DEVELOPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: BASIC RESEARCH
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Contractor Details
Address: 3550 GENERAL ATOMICS COURT, SAN DIEGO, CA, 92121
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: YES
Timeline
Start Date: 2004-04-30
Current End Date: 2014-06-30
Potential End Date: 2014-06-30 00:00:00
Last Modified: 2015-11-11
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