MITRE Corporation awarded $442.6M for Air Force NSEC services, a sole-source definitive contract

Contract Overview

Contract Amount: $442,564,039 ($442.6M)

Contractor: THE Mitre Corporation

Awarding Agency: Department of Defense

Start Date: 2022-10-01

End Date: 2023-05-15

Contract Duration: 226 days

Daily Burn Rate: $2.0M/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Other

Official Description: MITRE NATIONAL SECURITY ENGINEERING CENTER (NSEC) SERVICES FOR THE AIR FORCE

Place of Performance

Location: BEDFORD, MIDDLESEX County, MASSACHUSETTS, 01730

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $442.6 million to THE MITRE CORPORATION for work described as: MITRE NATIONAL SECURITY ENGINEERING CENTER (NSEC) SERVICES FOR THE AIR FORCE Key points: 1. Contract awarded on a sole-source basis, limiting competitive price discovery. 2. Significant contract value suggests a critical role for MITRE in Air Force operations. 3. The contract duration of 226 days is relatively short for its substantial value. 4. Cost-plus-fixed-fee contract type may incentivize cost escalation. 5. The 'All Other Professional, Scientific, and Technical Services' NAICS code is broad, potentially obscuring specific service details. 6. MITRE's established relationship with the government likely influenced the sole-source award.

Value Assessment

Rating: questionable

The contract value of $442.6 million over 226 days is exceptionally high on a daily basis. Without comparable sole-source contracts for similar broad technical services, it is difficult to benchmark value. The Cost Plus Fixed Fee (CPFF) pricing structure, while common for complex R&D, can lead to higher overall costs compared to fixed-price contracts if not managed rigorously. The lack of competition inherently reduces the government's ability to secure the lowest possible price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, The MITRE Corporation, was solicited. This approach bypasses the standard competitive bidding process. While sole-source awards can be justified for unique capabilities or urgent needs, they significantly limit price competition and may result in higher costs for the government compared to an open competition.

Taxpayer Impact: Taxpayers are potentially paying a premium due to the absence of competitive bidding, as the government did not explore alternative pricing from multiple vendors.

Public Impact

The primary beneficiary is the Department of the Air Force, receiving essential engineering and technical services. Services likely support critical national security initiatives and advanced technological development for the Air Force. The geographic impact is primarily within the United States, supporting Air Force installations and research facilities. Workforce implications include the direct employment of MITRE personnel and potential indirect impacts on related defense industry jobs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially leading to higher costs.
Cost-plus-fixed-fee contract type can incentivize cost growth.
Broad NAICS code may obscure specific performance metrics and value.
Short contract duration for a high value raises questions about project phasing or urgency.
Lack of transparency in the justification for sole-source award.

Positive Signals

MITRE's established track record and expertise in government contracting.
Potential for specialized knowledge and rapid deployment of critical services.
Cost-plus-fixed-fee allows flexibility for evolving technical requirements.
The contract supports critical Air Force missions.

Sector Analysis

The Information Technology and Professional Services sector is vast, with government contracting forming a significant portion. MITRE, as a federally funded research and development center (FFRDC), operates in a unique space, often receiving sole-source awards due to its specialized mission and relationship with the government. Comparable spending in this broad 'All Other Professional, Scientific, and Technical Services' category can vary widely, but a contract of this magnitude for a short duration suggests a high-priority, specialized undertaking.

Small Business Impact

This contract does not appear to involve a small business set-aside. As a sole-source award to a large, established organization like MITRE, there are likely no direct subcontracting opportunities for small businesses under this specific contract. This limits the direct economic benefit to the small business ecosystem from this particular award.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and program management offices. As a sole-source award, the justification and terms are subject to review. Transparency is limited due to the non-competitive nature. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

MITRE FFRDC Contracts
Air Force Research and Development
National Security Engineering Services
Department of Defense Technical Support

Risk Flags

Sole-source award
High daily expenditure rate
Cost-plus-fixed-fee pricing
Broad NAICS code

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $442.6 million to THE MITRE CORPORATION. MITRE NATIONAL SECURITY ENGINEERING CENTER (NSEC) SERVICES FOR THE AIR FORCE

Who is the contractor on this award?

The obligated recipient is THE MITRE CORPORATION.

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 $442.6 million.

What is the period of performance?

Start: 2022-10-01. End: 2023-05-15.

What specific services are encompassed by the broad 'All Other Professional, Scientific, and Technical Services' NAICS code for this contract?

The NAICS code 541990, 'All Other Professional, Scientific, and Technical Services,' is a catch-all category. For this specific contract with MITRE for the Air Force National Security Engineering Center (NSEC), it likely includes a wide array of highly specialized technical and engineering support. This could range from systems engineering, research and development, advanced technology integration, cybersecurity analysis, operational support, and strategic planning. The broadness of the code suggests that the services are diverse and potentially cutting-edge, requiring unique expertise that MITRE, as an FFRDC, is uniquely positioned to provide. Detailed service descriptions would typically be found in the contract's Statement of Work (SOW), which is not publicly available in this data.

What is the justification for awarding this substantial contract on a sole-source basis to The MITRE Corporation?

Sole-source awards are typically justified when a unique capability is required, there is an urgent need that cannot be met through competition, or when the awardee possesses specialized knowledge or is the only responsible source. For The MITRE Corporation, as a Federally Funded Research and Development Center (FFRDC), there's often a pre-existing relationship and a unique mission alignment with government agencies like the Air Force. MITRE's role often involves objective analysis, research, and development in areas critical to national security. The justification would likely cite MITRE's specific expertise, its FFRDC status, and potentially the need for continuity of services or access to proprietary knowledge that only MITRE possesses, making competition impractical or detrimental to the mission.

How does the Cost Plus Fixed Fee (CPFF) contract type potentially impact the final cost and risk for the Air Force?

A Cost Plus Fixed Fee (CPFF) contract type means the contractor (MITRE) is reimbursed for all allowable costs incurred, plus a fixed fee representing profit. This structure is often used when the scope of work is not well-defined or is expected to evolve, as is common in research and development. For the Air Force, the risk is that actual costs could significantly exceed initial estimates, although the fixed fee provides some predictability regarding profit. The government bears the primary risk of cost overruns. Effective oversight and cost controls by the Air Force are crucial to manage this risk and ensure the fixed fee remains reasonable relative to the effort expended. It can incentivize the contractor to control costs to some extent, as the fee is fixed, but it doesn't offer the same cost-saving incentives as fixed-price contracts.

Given the $442.6 million value and a duration of 226 days, what does this imply about the intensity or criticality of the services provided?

A contract value of approximately $442.6 million over just 226 days (about 7.5 months) translates to an average daily burn rate of roughly $1.96 million. This exceptionally high daily expenditure suggests that the services provided are extremely intensive, highly specialized, and likely critical to the Air Force's immediate operational or strategic objectives. Such a rate implies the engagement of a significant number of highly skilled personnel, advanced resources, and potentially rapid development or deployment cycles. It points towards a project of utmost importance, possibly related to urgent national security needs, advanced technological breakthroughs, or critical system sustainment where any delay would have severe consequences.

What is MITRE's historical performance record with the Department of Defense, particularly on large, sole-source contracts?

The MITRE Corporation has a long and generally well-regarded history of performance as a Federally Funded Research and Development Center (FFRDC) supporting the Department of Defense (DoD) and other government agencies. They are known for their technical expertise, objective analysis, and ability to tackle complex challenges. While specific performance metrics for individual contracts are often not public, MITRE's continued selection for sole-source awards and its FFRDC status indicate a high level of trust and consistent performance in the eyes of its government sponsors. However, like any large contractor, there can be instances of performance issues or cost concerns on specific projects, but overall, their track record is considered strong within the defense and national security community.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Address: 202 BURLINGTON RD, BEDFORD, MA, 01730

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

Financial Breakdown

Contract Ceiling: $502,196,171

Exercised Options: $502,196,171

Current Obligation: $442,564,039

Subaward Activity

Number of Subawards: 77

Total Subaward Amount: $6,383,874

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline