Air Force awards $6M+ engineering services contract to Applied Research Associates, Inc. for diagnostics system

Contract Overview

Contract Amount: $6,084,694 ($6.1M)

Contractor: Applied Research Associates, Inc.

Awarding Agency: Department of Defense

Start Date: 2020-09-30

End Date: 2030-12-11

Contract Duration: 3,724 days

Daily Burn Rate: $1.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: UNITED STATES PROMPT DIAGNOSTICS SYSTEM

Place of Performance

Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87110

State: New Mexico Government Spending

Plain-Language Summary

Department of Defense obligated $6.1 million to APPLIED RESEARCH ASSOCIATES, INC. for work described as: UNITED STATES PROMPT DIAGNOSTICS SYSTEM Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract spans over 10 years, indicating a long-term need for these services. 3. Firm Fixed Price contract type helps manage cost certainty for the government. 4. The North American Industry Classification System (NAICS) code 541330 points to engineering services. 5. The contract is for a diagnostics system, crucial for operational readiness. 6. The award was made by the Department of the Air Force, a major DoD component.

Value Assessment

Rating: good

The total contract value of over $6 million for a 10-year period suggests a moderate annual spend. Benchmarking this against similar long-term engineering support contracts for complex systems within the Department of Defense would provide a clearer picture of value for money. The firm fixed-price structure is generally favorable for cost control, but the overall value depends on the specific deliverables and the criticality of the diagnostics system.

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 number of bidders is not specified, but this method generally fosters price discovery and allows the government to select the most advantageous offer based on technical merit and price. The open competition suggests a healthy market for these specialized engineering services.

Taxpayer Impact: Taxpayers benefit from the competitive process, which is intended to drive down costs and ensure the government receives the best possible value for its investment in critical defense systems.

Public Impact

The primary beneficiaries are the Department of the Air Force, which will receive enhanced diagnostic capabilities for its systems. The contract supports the development and maintenance of a diagnostics system, likely improving operational efficiency and readiness. The geographic impact is primarily within New Mexico, where the contractor is located, potentially supporting local jobs. Workforce implications include specialized engineering roles required for the development and support of advanced diagnostic systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (over 10 years) could lead to potential cost overruns if not managed effectively.
Reliance on a single contractor for an extended period might limit future innovation or flexibility.
The specific nature of the 'diagnostics system' is not detailed, raising questions about its scope and potential obsolescence over the contract term.

Positive Signals

Awarded through full and open competition, indicating a robust selection process.
Firm Fixed Price contract type provides cost certainty for the government.
The contract supports a critical function (diagnostics system) for the Air Force, contributing to national security.
The contractor, Applied Research Associates, Inc., has a track record in engineering services, suggesting relevant expertise.

Sector Analysis

This contract falls within the engineering services sector, a critical component of the broader aerospace and defense industry. The market for specialized engineering services supporting defense systems is substantial, driven by the need for advanced technological solutions. Comparable spending benchmarks would involve analyzing other long-term engineering support contracts awarded by the DoD for complex systems, considering factors like contract duration, scope of work, and technology involved.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside requirement. However, the prime contractor may choose to subcontract portions of the work to small businesses, which could provide opportunities within the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Air Force contracting and program management offices. Accountability measures are inherent in the firm fixed-price structure, requiring the contractor to deliver specified services within the agreed-upon cost. Transparency is facilitated by contract award databases, though detailed performance metrics and specific oversight activities may not be publicly disclosed.

Related Government Programs

Defense Engineering Services
Aerospace Systems Support
Department of Defense IT and Software Development
Military Diagnostics and Maintenance Systems
Air Force Research and Development Contracts

Risk Flags

Long-term contract duration
Potential for technological obsolescence
Lack of specific system details

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $6.1 million to APPLIED RESEARCH ASSOCIATES, INC.. UNITED STATES PROMPT DIAGNOSTICS SYSTEM

Who is the contractor on this award?

The obligated recipient is APPLIED RESEARCH ASSOCIATES, 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 $6.1 million.

What is the period of performance?

Start: 2020-09-30. End: 2030-12-11.

What is the specific nature and criticality of the 'UNITED STATES PROMPT DIAGNOSTICS SYSTEM' being developed or supported under this contract?

The provided data does not detail the specific functionalities or criticality of the 'UNITED STATES PROMPT DIAGNOSTICS SYSTEM'. However, given the award by the Department of the Air Force and the NAICS code for engineering services, it is likely a system designed to rapidly identify issues or faults within military equipment, aircraft, or other critical assets. Such systems are vital for maintaining operational readiness, reducing downtime, and ensuring the safety and effectiveness of military operations. The prompt nature suggests a focus on real-time or near-real-time analysis, which is crucial in dynamic operational environments.

How does the $6 million contract value compare to similar long-term engineering support contracts for diagnostics systems within the DoD?

Without specific details on the scope, complexity, and deliverables of this particular diagnostics system, a direct comparison of the $6 million contract value to similar DoD contracts is challenging. However, for a 10-year duration, this represents an average annual spend of approximately $600,000. This figure is moderate for specialized engineering services within the defense sector, which can range from hundreds of thousands to tens of millions annually depending on the project's scale. Benchmarking would require identifying contracts with comparable system types (e.g., avionics diagnostics, weapon system diagnostics) and contract lengths awarded by agencies like the Air Force, Navy, or Army.

What is Applied Research Associates, Inc.'s track record with the Department of Defense, particularly in engineering services and diagnostics systems?

Applied Research Associates, Inc. (ARA) is a well-established research and engineering company that has a significant history of contracting with the Department of Defense and other government agencies. Their expertise spans various technical domains, including defense systems, advanced materials, and simulation. While the specific 'UNITED STATES PROMPT DIAGNOSTICS SYSTEM' may be a unique project, ARA's general background in complex engineering, analysis, and system development suggests they possess the requisite capabilities. A deeper dive into their contract history would reveal the extent of their experience with similar diagnostic technologies and their performance on past DoD projects.

What are the potential risks associated with a 10-year firm fixed-price contract for a diagnostics system, and how are they mitigated?

A significant risk with a long-term firm fixed-price contract is the potential for the contractor to face unforeseen cost increases due to inflation, material price volatility, or scope creep that isn't properly managed. For a diagnostics system, there's also the risk of technological obsolescence over a decade. Mitigation strategies employed by the government often include detailed contract clauses, performance metrics, phased delivery schedules, and regular reviews. The firm fixed-price nature itself mitigates cost overrun risk for the government, provided the initial scope is well-defined and change management is rigorous. The Air Force would likely have oversight mechanisms to monitor technological advancements and ensure the system remains relevant.

How does the 'full and open competition' award mechanism impact the overall value and efficiency for taxpayers?

Awarding this contract through 'full and open competition' is generally beneficial for taxpayers. This process allows any responsible contractor meeting the qualifications to submit a bid, fostering a competitive environment. Competition typically drives down prices as contractors vie for the contract, leading to better value for the government. It also encourages innovation as companies propose their best solutions. Furthermore, it ensures that the government selects the offer that provides the best combination of technical capability and cost-effectiveness, rather than being limited to a pre-selected group of vendors, thereby maximizing the efficient use of taxpayer funds.

What is the historical spending pattern for engineering services under NAICS code 541330 by the Department of the Air Force?

Historical spending data for engineering services (NAICS 541330) by the Department of the Air Force under full and open competition indicates a substantial and consistent investment in this sector. While specific aggregate figures for this contract's duration are not provided, the Air Force regularly procures engineering support for a wide array of defense systems, including aircraft, weapons, and infrastructure. Spending patterns often reflect modernization efforts, sustainment requirements, and research and development initiatives. The average value of such contracts can vary significantly based on project complexity, but the consistent award of contracts under this NAICS code suggests a sustained demand and budget allocation for these critical services.

Industry Classification

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

Product/Service Code: ALARM, SIGNAL, SECURITY DETECTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4300 SAN MATEO BLVD NE STE A-220, ALBUQUERQUE, NM, 87110

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

Financial Breakdown

Contract Ceiling: $6,890,998

Exercised Options: $6,890,998

Current Obligation: $6,084,694

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $806,694

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q14OADU104

IDV Type: IDC

Timeline