DoD's $212M COMMEX R&D contract awarded to BAE Systems for advanced communications

Contract Overview

Contract Amount: $21,235,166 ($21.2M)

Contractor: BAE Systems Information & Electronic Systems Integration Inc

Awarding Agency: Department of Defense

Start Date: 2011-03-31

End Date: 2016-08-31

Contract Duration: 1,980 days

Daily Burn Rate: $10.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: COMMUNICATIONS UNDER EXTREME RF SPECTRUM CONDITIONS (COMMEX)

Place of Performance

Location: MERRIMACK, HILLSBOROUGH County, NEW HAMPSHIRE, 03054

State: New Hampshire Government Spending

Plain-Language Summary

Department of Defense obligated $21.2 million to BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION INC for work described as: COMMUNICATIONS UNDER EXTREME RF SPECTRUM CONDITIONS (COMMEX) Key points: 1. Contract focused on research and development for communications in extreme radio frequency spectrum conditions. 2. BAE Systems, a major defense contractor, secured this definitive contract. 3. The contract duration was substantial, spanning nearly 2000 days. 4. Awarded under full and open competition, suggesting a broad search for qualified vendors. 5. The contract type, Cost Plus Fixed Fee, is common for R&D where costs can be unpredictable. 6. This falls under the R&D in Physical, Engineering, and Life Sciences category. 7. The contract was managed by the Defense Contract Management Agency. 8. The base award amount was over $10 million, with the total reaching over $212 million.

Value Assessment

Rating: fair

Benchmarking the value of this R&D contract is challenging due to its specialized nature and the inherent uncertainties in research and development. The Cost Plus Fixed Fee (CPFF) structure means the government pays for allowable costs plus a fixed fee, which can lead to cost overruns if not managed tightly. Without specific performance metrics or comparable R&D projects, it's difficult to definitively assess value for money. However, the significant increase from the base award to the total obligated amount suggests substantial work and potentially evolving research needs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit a bid. This approach is generally favored to ensure the government receives the best possible offers. The number of bidders is not specified, but full and open competition typically implies multiple interested parties, which can drive down prices and encourage innovation.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it maximizes the potential for competitive pricing and ensures that the government explores a wide range of solutions, potentially leading to more cost-effective outcomes for advanced research.

Public Impact

The primary beneficiaries are the Department of Defense, seeking to enhance its communication capabilities in challenging environments. The services delivered involve advanced research and development in radio frequency spectrum communications. The geographic impact is primarily within the United States, supporting defense research infrastructure. Workforce implications include highly skilled R&D personnel, engineers, and scientists employed by BAE Systems and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost overruns are a potential concern with CPFF contracts, especially in R&D where scope can evolve.
The long duration of the contract could indicate complexity or potential for scope creep.
Lack of specific performance metrics makes it hard to gauge R&D success and value.
The significant increase from base award to total obligated amount warrants scrutiny regarding cost management.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
BAE Systems is a reputable defense contractor with a track record in complex systems.
The contract addresses a critical need for advanced communications technology in demanding environments.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences, excluding biotechnology. The market for advanced defense communications technology is highly specialized, with a few large prime contractors like BAE Systems dominating. Spending in this area is driven by the need for technological superiority and operational effectiveness in complex military scenarios. Comparable spending benchmarks would typically be found within other large-scale DoD R&D initiatives for communication systems.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. While BAE Systems is the prime contractor, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting is not detailed here, but large prime contractors are often encouraged or required to engage small businesses to foster innovation and support the broader defense industrial base.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), responsible for ensuring contractor performance and compliance. The CPFF contract type necessitates close monitoring of costs and progress. Transparency is generally maintained through contract reporting requirements, though specific details of R&D progress might be sensitive. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Research and Development Programs
Advanced Communications Systems
Radio Frequency Spectrum Management
Electronic Warfare Systems
Military Communications Technology

Risk Flags

Cost Overrun Potential
Scope Creep Risk
R&D Success Uncertainty
Contract Management Intensity

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.2 million to BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION INC. COMMUNICATIONS UNDER EXTREME RF SPECTRUM CONDITIONS (COMMEX)

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $21.2 million.

What is the period of performance?

Start: 2011-03-31. End: 2016-08-31.

What was the specific technological advancement sought by the COMMEX program?

The COMMEX (Communications Under Extreme RF Spectrum Conditions) program aimed to develop and mature technologies enabling reliable and secure voice and data communications in highly contested and degraded electromagnetic environments. This includes overcoming challenges posed by jamming, interference, and spectrum scarcity. The R&D likely focused on areas such as adaptive waveform design, advanced signal processing, resilient network architectures, and potentially novel spectrum sharing techniques to ensure mission-critical communications could be maintained even under severe electronic warfare conditions.

How does the final obligated amount of $212M compare to the initial base award of $10.7M?

The final obligated amount of $212,351,660 represents a significant increase, approximately 19.8 times larger than the initial base award of $10,725,000. This substantial escalation suggests that the scope of work evolved considerably throughout the contract's duration or that initial funding was primarily for foundational research, with subsequent funding phases added to pursue promising avenues. Such increases in R&D contracts are not uncommon, reflecting the iterative nature of research where initial findings can lead to expanded efforts, but they also highlight the importance of robust oversight to ensure continued alignment with program objectives and cost-effectiveness.

What are the potential risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D?

CPFF contracts carry inherent risks, particularly in R&D settings. For the government, the primary risk is cost overrun, as the contractor is reimbursed for all allowable costs incurred. If costs escalate beyond initial projections, the total expenditure can increase significantly, potentially exceeding budget allocations. The 'fixed fee' component, while providing incentive for efficiency, might not always adequately compensate for unforeseen complexities or scope changes common in R&D. For the contractor, risks include the potential for disallowed costs or disputes over what constitutes an 'allowable' expense. Effective management requires diligent oversight of contractor expenditures and progress.

What is the significance of BAE Systems being the contractor for this program?

BAE Systems is a major global defense, aerospace, and security company with extensive experience in developing complex electronic systems, including communications and electronic warfare capabilities. Their selection suggests they possess the necessary technical expertise, infrastructure, and security clearances required for this advanced R&D effort. Having a large, established contractor like BAE Systems can provide stability and a proven track record, potentially accelerating development. However, it also means the contract value is concentrated with a single large entity, underscoring the importance of ensuring fair competition and potential subcontracting opportunities for smaller, innovative firms.

How does this contract fit into the broader landscape of DoD R&D spending?

This contract represents a specific investment within the Department of Defense's substantial Research, Development, Test, and Evaluation (RDT&E) budget. DoD R&D spending is crucial for maintaining technological superiority and addressing evolving threats. Contracts like COMMEX, focusing on critical areas like resilient communications, are vital components of modernization efforts. While $212 million is a significant sum for a single contract, it is a fraction of the overall DoD R&D portfolio, which often runs into tens of billions of dollars annually across various scientific and engineering disciplines. This contract highlights the ongoing emphasis on advanced electronic warfare and communication resilience.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: BASIC RESEARCH

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC

Address: 144 DANIEL WEBSTER HWY # 24, MERRIMACK, NH, 03054

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $38,796,902

Exercised Options: $21,285,166

Current Obligation: $21,235,166

Actual Outlays: $113,659

Subaward Activity

Number of Subawards: 16

Total Subaward Amount: $3,479,620

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline