DoD awards $40M+ for 15 T-REX units to Georgia Tech Applied Research Corp for radar system upgrade

Contract Overview

Contract Amount: $40,090,122 ($40.1M)

Contractor: Georgia Tech Applied Research Corp

Awarding Agency: Department of Defense

Start Date: 2024-09-30

End Date: 2028-11-30

Contract Duration: 1,522 days

Daily Burn Rate: $26.3K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: BUILD AND DELIVER 15 TRANSITIONAL RECEIVER EXCITER (T-REX) UNITS PLUS LINE REPLACEMENT UNIT (LRU) SPARES TO COMPLETE A FULL FLEET REPLACEMENT OF LEGACY REXS FOR THE UPGRADED EARLY WARNING RADAR (UEWR) WEAPON SYSTEM.

Place of Performance

Location: ATLANTA, FULTON County, GEORGIA, 30318

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $40.1 million to GEORGIA TECH APPLIED RESEARCH CORP for work described as: BUILD AND DELIVER 15 TRANSITIONAL RECEIVER EXCITER (T-REX) UNITS PLUS LINE REPLACEMENT UNIT (LRU) SPARES TO COMPLETE A FULL FLEET REPLACEMENT OF LEGACY REXS FOR THE UPGRADED EARLY WARNING RADAR (UEWR) WEAPON SYSTEM. Key points: 1. Contract awarded for critical components of an early warning radar system, indicating a focus on national security infrastructure. 2. The sole-source nature of this award warrants scrutiny regarding potential cost efficiencies and market alternatives. 3. A significant duration of over 4 years suggests a complex integration or development process. 4. The contract type (Cost Plus Fixed Fee) can lead to cost overruns if not closely managed. 5. This award falls under R&D services, highlighting investment in advanced technological capabilities. 6. The geographic location of the contractor in Georgia may have implications for regional economic impact.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its specialized nature and sole-source award. The Cost Plus Fixed Fee structure introduces inherent risk for cost escalation, as the contractor is reimbursed for allowable costs plus a fixed fee. Without competitive bids, it's difficult to ascertain if the pricing reflects fair market value or if efficiencies could have been achieved through a more competitive process. Further analysis would require understanding the specific R&D complexities and the contractor's unique capabilities.

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 typically occurs when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The lack of competition limits price discovery and may result in higher costs for the government compared to a fully competed award.

Taxpayer Impact: Taxpayers may face higher costs due to the absence of competitive pressure to drive down prices. The government's ability to negotiate favorable terms is also reduced in a sole-source scenario.

Public Impact

The primary beneficiaries are the Department of Defense and the Air Force, receiving advanced radar components essential for national security. The contract will deliver 15 Transitional Receiver Exciter (T-REX) units and associated Line Replacement Unit (LRU) spares. These components are crucial for completing a full fleet replacement of legacy systems for the Upgraded Early Warning Radar (UEWR) weapon system. The project supports the modernization of critical defense infrastructure, enhancing early warning capabilities. The workforce implications are likely concentrated within Georgia Tech Applied Research Corp's specialized engineering and technical staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type increases risk of cost overruns.
Sole-source award limits competitive pricing and potential for cost savings.
Lack of transparency in the sole-source justification could mask inefficiencies.
Long contract duration may indicate potential for scope creep or unforeseen challenges.
Specialized nature of the components makes independent cost verification difficult.

Positive Signals

Award to Georgia Tech Applied Research Corp, potentially leveraging specialized expertise.
Contract supports a critical national security weapon system (UEWR).
Delivery of 15 T-REX units and LRU spares ensures fleet modernization.
Clear end date (2028-11-30) provides a defined project timeline.
Contracting action is a delivery order, suggesting it's part of a larger framework or existing relationship.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The market for advanced radar components and early warning systems is highly specialized, often dominated by a few key defense contractors and research institutions. Spending in this area is driven by national security imperatives and the continuous need to upgrade and maintain sophisticated defense technologies. Comparable spending benchmarks would likely be found within other major defense system modernization programs.

Small Business Impact

This contract does not appear to involve small business set-asides, as indicated by 'sb': false. The sole-source nature further suggests that subcontracting opportunities for small businesses may be limited and dependent on Georgia Tech Applied Research Corp's internal procurement practices. Without a competitive bidding process, there is less inherent pressure to include small business participation goals.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Air Force, given the agency's role. As a Cost Plus Fixed Fee contract, rigorous financial oversight and auditing will be crucial to monitor allowable costs and ensure the fixed fee is justified. Transparency may be limited due to the sole-source award, but contract performance reviews and milestone tracking should be standard oversight mechanisms. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Upgraded Early Warning Radar (UEWR) Weapon System
Air Force Radar Modernization Programs
Defense Research and Development Contracts
Advanced Electronic Systems Procurement

Risk Flags

Sole-source award may limit competition and increase costs.
Cost Plus Fixed Fee contract type carries inherent risk of cost overruns.
Lack of detailed public justification for sole-source award.
Specialized nature of components makes independent value assessment difficult.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $40.1 million to GEORGIA TECH APPLIED RESEARCH CORP. BUILD AND DELIVER 15 TRANSITIONAL RECEIVER EXCITER (T-REX) UNITS PLUS LINE REPLACEMENT UNIT (LRU) SPARES TO COMPLETE A FULL FLEET REPLACEMENT OF LEGACY REXS FOR THE UPGRADED EARLY WARNING RADAR (UEWR) WEAPON SYSTEM.

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 $40.1 million.

What is the period of performance?

Start: 2024-09-30. End: 2028-11-30.

What is the specific justification for awarding this contract on a sole-source basis to Georgia Tech Applied Research Corp?

The provided data does not detail the specific justification for the sole-source award. Typically, sole-source contracts are awarded when only one responsible source is available or capable of meeting the agency's needs. This could be due to unique technical expertise, proprietary technology, or the urgency of the requirement where competition is not feasible. For this contract, it's likely that Georgia Tech Applied Research Corp possesses specialized knowledge or technology critical for the T-REX units and the UEWR system upgrade that other entities cannot replicate. A full justification would typically be documented by the procuring agency.

How does the Cost Plus Fixed Fee (CPFF) contract type compare to other contract types in terms of risk and potential cost savings for the government?

The Cost Plus Fixed Fee (CPFF) contract type is often used for research and development or complex projects where the scope of work is not fully defined at the outset. Under CPFF, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure shifts some cost risk to the government, as the final cost can exceed initial estimates if costs escalate. Compared to fixed-price contracts, CPFF offers less cost certainty for the government but can be advantageous when innovation and flexibility are paramount. It is generally considered riskier than fixed-price contracts regarding cost control but can be more appropriate than cost-plus-award-fee or cost-plus-incentive-fee contracts when performance incentives are less critical than ensuring the work is completed.

What are the potential implications of awarding a contract of this magnitude and duration without competition for future radar system procurements?

Awarding a contract of this magnitude ($40M+) and duration (over 4 years) on a sole-source basis can have several implications for future procurements. Firstly, it may signal to the market that Georgia Tech Applied Research Corp is the preferred or sole provider for these specific T-REX units, potentially discouraging other firms from developing competing capabilities. Secondly, the lack of competitive pricing data makes it harder for the government to benchmark costs for similar future acquisitions. This could lead to higher anticipated costs in subsequent solicitations or a continued reliance on sole-source awards if the initial justification remains valid. It also reduces the opportunity for the government to benefit from innovative solutions or cost efficiencies that a competitive environment might foster.

Can the $40,090,122 award amount be considered high or low relative to the scope of delivering 15 T-REX units and spares?

Determining if $40,090,122 is high or low for 15 T-REX units and spares is challenging without detailed cost breakdowns, technical specifications, and market comparisons. The T-REX units are described as components for an 'Upgraded Early Warning Radar (UEWR) Weapon System,' suggesting they are highly specialized, technologically advanced, and likely expensive to develop and manufacture. The contract type (Cost Plus Fixed Fee) also implies that costs are reimbursed, making direct price comparisons difficult. However, considering the complexity of defense systems, the R&D nature of the work, and the long delivery timeline, the amount is plausible for such critical, low-volume, high-tech components. A more definitive assessment would require access to detailed cost proposals, independent government cost estimates, and data on similar advanced electronic warfare or radar system components.

What is the historical spending pattern for the Upgraded Early Warning Radar (UEWR) weapon system, and how does this award fit into it?

The provided data does not include historical spending patterns for the UEWR weapon system. However, this award is explicitly stated as being for 'BUILD AND DELIVER 15 TRANSITIONAL RECEIVER EXCITER (T-REX) UNITS PLUS LINE REPLACEMENT UNIT (LRU) SPARES TO COMPLETE A FULL FLEET REPLACEMENT OF LEGACY REXS FOR THE UPGRADED EARLY WARNING RADAR (UEWR) WEAPON SYSTEM.' This indicates that this contract is a crucial step in a larger modernization effort for the UEWR system. The fact that it's a 'full fleet replacement' suggests a significant, ongoing investment in this weapon system. Future spending would likely depend on the success of this phase, the sustainment needs of the new T-REX units, and any subsequent upgrades or modifications planned for the UEWR system.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 926 DALNEY ST NW, 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: $64,532,594

Exercised Options: $40,090,122

Current Obligation: $40,090,122

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $611,819

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA873021D0001

IDV Type: IDC

Timeline