Draper Laboratory awarded $29.8M sole-source contract for GPS testing assets, raising value-for-money questions

Contract Overview

Contract Amount: $29,792,858 ($29.8M)

Contractor: THE Charles Stark Draper Laboratory, Inc.

Awarding Agency: Department of Defense

Start Date: 2021-02-01

End Date: 2026-01-31

Contract Duration: 1,825 days

Daily Burn Rate: $16.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: GLOBAL POSITIONING SYSTEM TEST ASSET PROGRAM (GTAP)

Place of Performance

Location: CAMBRIDGE, MIDDLESEX County, MASSACHUSETTS, 02139

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $29.8 million to THE CHARLES STARK DRAPER LABORATORY, INC. for work described as: GLOBAL POSITIONING SYSTEM TEST ASSET PROGRAM (GTAP) Key points: 1. The contract's sole-source nature limits competitive pressure, potentially impacting price efficiency. 2. A high fixed-price contract suggests a defined scope, but requires careful monitoring for scope creep. 3. The duration of 5 years indicates a long-term need for these specialized testing services. 4. The absence of small business set-asides warrants scrutiny of subcontracting opportunities. 5. Performance context is limited without specific metrics on testing accuracy or efficiency gains. 6. The contract falls within the professional, scientific, and technical services sector, dominated by large incumbents.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature and specialized scope. Without competitive bids, it's difficult to ascertain if the $29.8 million represents a fair market price. The fixed-price structure provides cost certainty for the government, but the lack of competition means the contractor has less incentive to offer the lowest possible price. Further analysis would require comparing the scope and deliverables to similar, competitively awarded contracts for GPS testing services, if available.

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 Charles Stark Draper Laboratory, Inc., was solicited. This approach bypasses the standard competitive bidding process. While sole-source awards can be justified for unique capabilities or urgent needs, they typically result in higher prices and reduced innovation compared to full and open competition. The lack of multiple bidders means the government did not benefit from price discovery through market forces.

Taxpayer Impact: The absence of competition means taxpayers may be paying a premium for these services. Without competitive pressure, there is less incentive for the contractor to minimize costs, potentially leading to less efficient use of federal funds.

Public Impact

The primary beneficiary is the Department of the Air Force, which relies on these testing assets for GPS program development and maintenance. The services delivered include specialized testing and evaluation of Global Positioning System (GPS) assets. The geographic impact is primarily within the United States, supporting national defense and technological infrastructure. Workforce implications may include continued employment for highly skilled engineers and technicians at Draper Laboratory.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential for cost savings.
Lack of transparency in the justification for sole-source procurement.
Long contract duration without clear performance benchmarks could lead to complacency.
No explicit small business subcontracting goals identified.

Positive Signals

Draper Laboratory is a recognized leader in its field, suggesting technical expertise.
Fixed-price contract provides cost predictability for the government.
The contract supports a critical national security program (GPS).

Sector Analysis

This contract falls within the Professional, Scientific, and Technical Services sector, specifically focusing on testing laboratories and services (NAICS 541380). This sector is characterized by high technical expertise and often involves specialized equipment and facilities. The market for GPS testing is likely concentrated among a few key players with the necessary security clearances and technical capabilities. Comparable spending benchmarks are difficult to establish due to the specialized nature of GPS testing and the sole-source award.

Small Business Impact

This contract does not appear to have a small business set-aside, nor is there an indication of mandatory subcontracting goals for small businesses. The sole-source nature of the award further limits opportunities for small businesses to participate directly. This could mean that the ecosystem of small businesses supporting defense technology development may not benefit from this specific contract, unless Draper Laboratory voluntarily engages them as subcontractors.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force contracting and program management offices. Accountability measures are typically embedded within the contract terms, including delivery schedules and technical specifications. Transparency is limited due to the sole-source nature, with justifications for the award likely residing in internal agency documentation. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Global Positioning System (GPS) Modernization Programs
Defense Test and Evaluation Services
Aerospace and Defense Research and Development
Navigation and Timing Technologies

Risk Flags

Sole-source award raises concerns about competition and potential price inflation.
Lack of publicly available justification for sole-source procurement.
Absence of small business subcontracting requirements limits broader economic impact.
Long contract duration without explicit performance metrics requires diligent oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.8 million to THE CHARLES STARK DRAPER LABORATORY, INC.. GLOBAL POSITIONING SYSTEM TEST ASSET PROGRAM (GTAP)

Who is the contractor on this award?

The obligated recipient is THE CHARLES STARK DRAPER LABORATORY, 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 $29.8 million.

What is the period of performance?

Start: 2021-02-01. End: 2026-01-31.

What is the specific justification provided by the Department of the Air Force for awarding this contract on a sole-source basis to The Charles Stark Draper Laboratory, Inc.?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are justified under circumstances such as when only one responsible source is capable of providing the required service or property, or when there is a compelling urgency. For specialized technical services like GPS testing, it's often argued that only a limited number of entities possess the unique expertise, facilities, and security clearances required. A full justification would detail these unique capabilities and explain why competitive procurement was not feasible or advantageous.

How does the $29.8 million contract value compare to historical spending on similar GPS testing services, either with Draper Laboratory or other contractors?

Direct comparison of the $29.8 million contract value to historical spending is difficult without more granular data on the scope of services and the specific testing phases covered. Historical spending patterns for GPS testing can vary significantly based on program maturity, technological advancements, and the specific components or systems being tested. If this contract represents a continuation or expansion of previous work, a trend analysis of Draper's historical billing for similar services would be informative. However, without access to detailed historical contract data and competitive benchmarks, assessing whether this amount is high or low relative to market rates remains speculative.

What are the key performance indicators (KPIs) or deliverables outlined in the contract to measure the success and efficiency of the GPS testing services provided by Draper Laboratory?

The provided data does not specify the key performance indicators (KPIs) or detailed deliverables for this contract. However, for a contract of this nature, KPIs would typically focus on the accuracy and reliability of test results, adherence to testing protocols, timely completion of test cycles, and the quality of technical reports generated. Deliverables would likely include comprehensive test plans, raw test data, analysis reports, and potentially recommendations for system improvements. The effectiveness of the services would be measured by how well these testing activities contribute to the overall reliability, security, and performance of the GPS system.

What is the track record of The Charles Stark Draper Laboratory, Inc. in performing similar complex testing and evaluation contracts for the Department of Defense or other federal agencies?

The Charles Stark Draper Laboratory, Inc. has a long-standing reputation and extensive experience in performing complex engineering, research, and development services, particularly in areas related to guidance, navigation, and control systems, which are critical for GPS. They have historically been a key contractor for the Department of Defense and other agencies on sensitive and technologically advanced programs. Their track record generally indicates a high level of technical competence and the ability to handle challenging projects. However, a detailed review of past performance evaluations and any past issues on similar contracts would be necessary for a comprehensive assessment.

Given the sole-source nature, what mechanisms are in place to ensure cost control and prevent potential overruns or inefficiencies throughout the contract's five-year duration?

While sole-source awards inherently reduce competitive pressure, cost control mechanisms can still be implemented. For this fixed-price contract, the primary cost control is the agreed-upon total price. However, effective oversight is crucial. This includes rigorous review of invoices, monitoring of labor hours and material costs against the contract baseline, and potentially establishing milestones tied to payments. The Air Force contracting officer should actively manage the contract, ensuring that the scope of work remains as defined and that any proposed changes are thoroughly vetted for necessity and cost impact. Regular communication and performance reviews with Draper Laboratory are also vital for identifying and addressing potential inefficiencies early on.

Industry Classification

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

Product/Service Code: QUALITY CONTROL, TEST, INSPECTION › EQUIPMENT AND MATERIALS TESTING

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 555 TECHNOLOGY SQ, CAMBRIDGE, MA, 02139

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: $35,292,171

Exercised Options: $29,792,858

Current Obligation: $29,792,858

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $74,987

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline