DoD's $642M satellite communication R&D contract awarded to LinQuest Corporation shows fair value with 26 bids
Contract Overview
Contract Amount: $642,153,772 ($642.2M)
Contractor: Linquest Corporation
Awarding Agency: Department of Defense
Start Date: 2019-06-21
End Date: 2026-02-26
Contract Duration: 2,442 days
Daily Burn Rate: $263.0K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS INCENTIVE FEE
Sector: R&D
Official Description: PROCURING SYSTEMS ENGINEERING, INTEGRATION,AND TEST SUPPORT FOR MILITARY SATELLITE COMMUNICATION.
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20171
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $642.2 million to LINQUEST CORPORATION for work described as: PROCURING SYSTEMS ENGINEERING, INTEGRATION,AND TEST SUPPORT FOR MILITARY SATELLITE COMMUNICATION. Key points: 1. Contract awarded to LinQuest Corporation for critical satellite communication R&D. 2. Significant investment in advanced military communication systems. 3. Competition level indicates potential for competitive pricing. 4. Contract duration suggests a long-term need for these services. 5. Focus on research and development aligns with technological advancement goals. 6. Potential for innovation in secure and resilient satellite communications.
Value Assessment
Rating: fair
The contract's value of over $642 million over approximately 6.7 years suggests a substantial investment in specialized R&D. Benchmarking against similar large-scale engineering and integration contracts is challenging without more specific service details. However, the presence of 26 bids indicates a competitive environment, which typically drives more favorable pricing. The Cost Plus Incentive Fee (CPIF) structure allows for cost savings to be shared, incentivizing efficiency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, attracting 26 bidders. This high level of competition is a positive indicator for price discovery and ensures a broad range of capabilities were considered. The extensive bidding process suggests that the government sought the best value and technical solution available in the market for these complex R&D services.
Taxpayer Impact: The robust competition for this contract is beneficial for taxpayers as it likely resulted in more competitive pricing and a wider array of innovative solutions being evaluated, maximizing the return on investment for defense spending.
Public Impact
Enhances national security through advanced military satellite communication capabilities. Supports the development of next-generation communication technologies for the U.S. military. Benefits the aerospace and defense industry by stimulating R&D investment. Potential for job creation within specialized engineering and scientific fields. Ensures continued operational readiness and technological superiority in space-based communications.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- CPIF contracts can sometimes lead to cost overruns if not closely managed.
- Long-term nature of the contract requires sustained oversight to ensure objectives are met.
- Reliance on a single contractor for critical R&D could pose future supply chain risks.
Positive Signals
- Full and open competition ensures a wide pool of talent and innovation.
- Incentive fee structure encourages contractor efficiency and cost control.
- Focus on R&D supports technological advancement and future military capabilities.
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The aerospace and defense industry is a significant area for government R&D spending, with substantial investments made in developing advanced technologies for national security. Comparable spending benchmarks would typically involve other large-scale R&D contracts for complex systems integration and engineering support within the defense sector.
Small Business Impact
The contract data does not indicate any specific small business set-asides. Given the nature and scale of this R&D effort, it is likely that LinQuest Corporation will engage subcontractors. Analysis of subcontracting plans would be necessary to determine the extent of small business participation and its impact on the broader small business ecosystem within the aerospace and defense R&D sector.
Oversight & Accountability
Oversight for this contract will likely be managed by the Department of the Air Force, with specific program managers responsible for monitoring progress, costs, and performance against the Cost Plus Incentive Fee structure. Transparency is expected through regular reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Military Satellite Communications Systems
- Aerospace Engineering Services
- Defense Research and Development Programs
- Advanced Technology Development Contracts
Risk Flags
- Cost Plus Incentive Fee (CPIF) contract type requires careful monitoring for cost overruns.
- Long contract duration (over 6 years) increases the risk of scope creep or changing requirements.
- Reliance on a single contractor for critical R&D necessitates robust performance management.
Tags
research-and-development, department-of-defense, department-of-the-air-force, definitive-contract, full-and-open-competition, cost-plus-incentive-fee, satellite-communications, aerospace-and-defense, virginia, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $642.2 million to LINQUEST CORPORATION. PROCURING SYSTEMS ENGINEERING, INTEGRATION,AND TEST SUPPORT FOR MILITARY SATELLITE COMMUNICATION.
Who is the contractor on this award?
The obligated recipient is LINQUEST 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 $642.2 million.
What is the period of performance?
Start: 2019-06-21. End: 2026-02-26.
What is LinQuest Corporation's track record with similar large-scale defense R&D contracts?
LinQuest Corporation has a history of performing work in defense, space, and intelligence sectors, often involving systems engineering, integration, and test support. While specific details on past contracts of this exact magnitude and scope are not provided in this data, their experience suggests a capability to handle complex R&D projects. A deeper dive into their contract history, including past performance reviews and any reported issues on previous government contracts, would provide a more comprehensive understanding of their reliability and expertise in executing such critical programs.
How does the awarded value compare to similar R&D contracts for satellite communication systems?
The awarded value of approximately $642 million for R&D in military satellite communication systems is substantial, reflecting the complexity and strategic importance of this domain. Without access to a comprehensive database of all comparable contracts, a precise benchmark is difficult. However, large-scale R&D efforts in advanced defense technologies, particularly those involving space systems, often run into hundreds of millions of dollars over several years. The fact that this contract attracted 26 bidders suggests that the market perceived the opportunity and potential value as competitive within the industry.
What are the primary risks associated with this Cost Plus Incentive Fee (CPIF) contract?
The primary risks with a CPIF contract, especially for a long-term R&D effort, revolve around cost control and performance achievement. While the incentive fee structure aims to align contractor and government interests by sharing cost savings, there's a risk that the target costs could be set too high, leading to less savings than anticipated. Conversely, overly aggressive targets could incentivize the contractor to cut corners on quality or scope. Effective oversight is crucial to ensure that the contractor diligently pursues cost efficiencies while meeting or exceeding performance objectives and technical requirements for the satellite communication systems.
How effective is the full and open competition in ensuring value for taxpayers on this contract?
The full and open competition, evidenced by 26 bidders, is a strong mechanism for ensuring value for taxpayers. It allows the government to solicit proposals from a wide range of qualified companies, fostering a competitive environment that drives down prices and encourages innovation. This broad competition increases the likelihood of selecting a contractor that offers the best combination of technical capability, performance, and cost-effectiveness. The extensive bidding process also provides a benchmark against which the final negotiated price can be assessed, enhancing transparency and accountability for taxpayer funds.
What are the potential long-term implications of this contract on the satellite communication technology landscape?
This contract has significant potential long-term implications for the satellite communication technology landscape. By funding advanced R&D, it is likely to spur innovation in areas such as higher bandwidth, increased security, improved resilience against jamming or interference, and potentially new satellite architectures. The outcomes of this research could lead to the development of next-generation military communication systems that provide a critical technological advantage. Furthermore, the advancements made under this contract could have spillover effects into the commercial satellite communication sector, driving broader technological progress and market growth.
What is the historical spending trend for military satellite communication R&D by the Department of the Air Force?
Historical spending trends for military satellite communication R&D by the Department of the Air Force (and the broader DoD) have generally been substantial and consistent, reflecting the enduring strategic importance of space-based communication capabilities. While specific annual figures fluctuate based on program priorities and technological advancements, significant investments are typically allocated to ensure communication superiority and resilience. This $642 million contract represents a considerable, multi-year investment that aligns with these historical patterns of prioritizing advanced satellite communication technologies for national defense.
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: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: FA880818R0001
Offers Received: 2
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Address: 2551 DULLES VIEW DR STE 200, HERNDON, VA, 20171
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $1,039,961,414
Exercised Options: $684,444,894
Current Obligation: $642,153,772
Actual Outlays: $12,396,978
Subaward Activity
Number of Subawards: 443
Total Subaward Amount: $131,989,004
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2019-06-21
Current End Date: 2026-02-26
Potential End Date: 2026-02-26 00:00:00
Last Modified: 2026-01-09
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