DoD's $12.9M R&D contract for space-suitable electronics awarded to Leidos, Inc. shows high cost per unit
Contract Overview
Contract Amount: $12,946,478 ($12.9M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2008-08-22
End Date: 2016-05-22
Contract Duration: 2,830 days
Daily Burn Rate: $4.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 20
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: BAA VS-06-05, "SPACE-SUITABLE ELECTRONIC COMPONENTS AND RESPONSIVE SYSTEMS"
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $12.9 million to LEIDOS, INC. for work described as: BAA VS-06-05, "SPACE-SUITABLE ELECTRONIC COMPONENTS AND RESPONSIVE SYSTEMS" Key points: 1. The contract's cost-plus-fixed-fee structure may lead to cost overruns. 2. A single award for research and development suggests a focused, potentially specialized need. 3. The long duration of the contract (2830 days) indicates a complex, multi-year research effort. 4. The contract's value is moderate within the R&D sector. 5. Performance context is limited without specific deliverables or milestones. 6. Sector positioning is within specialized defense R&D for space applications.
Value Assessment
Rating: questionable
The contract's total value of $12.9 million for research and development is difficult to benchmark without specific technical details. However, the high number of modifications (20) suggests potential scope creep or evolving requirements, which can impact overall value. The cost-plus-fixed-fee pricing structure, while common in R&D, carries inherent risks of cost escalation if not tightly managed. Without comparable contracts for similar space-suitable electronic components and responsive systems, a definitive value-for-money assessment is challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of 20 modifications suggests that the scope or requirements may have evolved significantly over the contract's lifecycle. While the initial competition was broad, the subsequent modifications could indicate a need for specialized expertise or a shift in technical direction that may have limited subsequent competitive opportunities for specific task orders.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices. However, the extensive modifications on this contract warrant scrutiny to ensure that the initial competitive advantage was maintained throughout its duration.
Public Impact
The Department of Defense benefits from advancements in space-suitable electronic components and responsive systems. This contract supports research and development activities aimed at enhancing military space capabilities. The geographic impact is primarily within the contractor's operational areas, likely supporting national defense objectives. Workforce implications include specialized R&D personnel in engineering and physical sciences.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns due to cost-plus-fixed-fee structure.
- Scope creep indicated by 20 contract modifications.
- Lack of clear performance metrics makes value assessment difficult.
- Long contract duration may indicate project complexity or delays.
Positive Signals
- Awarded through full and open competition, suggesting a robust initial bidding process.
- Contractor (Leidos, Inc.) is a well-established entity in defense contracting.
- Focus on R&D for critical space-based systems aligns with strategic defense needs.
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences, excluding biotechnology. The market for space-suitable electronic components and responsive systems is highly specialized, driven by government and commercial space exploration and defense needs. Comparable spending in this niche R&D area can vary widely based on technological complexity and program objectives. The total value of $12.9 million is moderate for a multi-year R&D effort in this field.
Small Business Impact
The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Leidos, Inc. is a large business. There is no explicit information on subcontracting plans or performance related to small businesses within this specific contract award. Therefore, the direct impact on the small business ecosystem from this particular contract is likely minimal, unless Leidos actively engages small businesses as subcontractors.
Oversight & Accountability
Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), as indicated by the 'sa' field. Accountability measures would be tied to the terms of the Cost Plus Fixed Fee (CPFF) contract, including adherence to the Statement of Work and delivery of research outcomes. Transparency is generally maintained through contract databases and reporting, though specific technical details of R&D may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Space Systems Development
- Advanced Electronics Research
- Defense Research and Development
- Aerospace Component Engineering
- National Security Space Programs
Risk Flags
- High number of contract modifications.
- Cost-plus-fixed-fee pricing structure.
- Long contract duration.
Tags
department-of-defense, defense-contract-management-agency, leidos-inc, research-and-development, space-systems, electronic-components, cost-plus-fixed-fee, full-and-open-competition, definitive-contract, virginia, moderate-value
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $12.9 million to LEIDOS, INC.. BAA VS-06-05, "SPACE-SUITABLE ELECTRONIC COMPONENTS AND RESPONSIVE SYSTEMS"
Who is the contractor on this award?
The obligated recipient is LEIDOS, 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 $12.9 million.
What is the period of performance?
Start: 2008-08-22. End: 2016-05-22.
What is Leidos, Inc.'s track record with similar R&D contracts for the Department of Defense?
Leidos, Inc. has a substantial track record with the Department of Defense, frequently securing contracts across various R&D and service categories. Their expertise spans areas like information technology, intelligence analysis, and complex engineering solutions. For R&D contracts specifically, Leidos has been involved in developing advanced technologies, including those related to aerospace and defense systems. A review of their contract history with the DoD would likely reveal numerous awards for research and development efforts, some of which may share similarities in scope or technical domain with this 'SPACE-SUITABLE ELECTRONIC COMPONENTS AND RESPONSIVE SYSTEMS' contract. Their performance on these prior contracts would provide context for their capability to execute this specific award effectively.
How does the cost-plus-fixed-fee (CPFF) structure impact the value for money in this contract?
The Cost-Plus-Fixed-Fee (CPFF) contract structure, used here, allows the contractor to recover all allowable costs incurred plus a predetermined fixed fee representing profit. While this structure is common for R&D where the scope and final costs are uncertain, it inherently carries a risk of cost overruns. The government bears the risk of cost increases, as the fee remains fixed. Value for money is therefore highly dependent on robust cost oversight and effective management by the contracting agency to ensure that costs are reasonable and allocable. Without detailed insights into the cost drivers and the contractor's efficiency, it's challenging to definitively assess the value for money achieved under this CPFF arrangement, especially given the 20 modifications which could indicate evolving cost bases.
What are the primary risks associated with a long-duration R&D contract like this one?
Long-duration R&D contracts, such as this 2830-day award, present several key risks. Firstly, technological obsolescence is a significant concern; the technology being researched may be outdated by the time the contract concludes. Secondly, the evolving threat landscape or strategic priorities of the Department of Defense could render the research outcomes less relevant or even obsolete. Thirdly, managing a project over an extended period increases the likelihood of scope creep, personnel turnover, and potential communication breakdowns between the contractor and the government. Finally, the extended timeline can make it difficult to maintain consistent oversight and ensure that the project remains on track and within budget, potentially leading to increased costs and delayed delivery of critical capabilities.
How does the 'Research and Development in the Physical, Engineering, and Life Sciences' NAICS code influence the interpretation of this contract?
The NAICS code 541712, 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology),' categorizes this contract within a broad but specialized segment of scientific and technical innovation. This classification indicates that the contract's objective is to advance fundamental knowledge or apply scientific research to develop new or improved products, processes, or services within these disciplines. For this specific contract concerning 'SPACE-SUITABLE ELECTRONIC COMPONENTS AND RESPONSIVE SYSTEMS,' the NAICS code suggests the work involves theoretical analysis, experimentation, and systematic development, likely focusing on the engineering and physical sciences aspects relevant to space applications. It implies a focus on innovation and discovery rather than routine production or services.
What does the number of contract modifications (20) suggest about the contract's execution and potential cost implications?
The presence of 20 modifications to this contract over its lifecycle is a significant indicator that the original scope, requirements, or technical approach underwent substantial changes. In a Cost Plus Fixed Fee (CPFF) contract, modifications can directly impact the total cost incurred by the government, as they often involve adjustments to the scope of work, timelines, or resource allocation. While some modifications are standard for long-term R&D projects to adapt to new findings or challenges, a high number like 20 suggests potential issues such as initial under-specification of requirements, evolving technological needs, or unforeseen complexities. Each modification requires administrative effort and could lead to increased costs, necessitating careful review to ensure they were justified and managed effectively to maintain value for the taxpayer.
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 › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: BASIC RESEARCH
Offers Received: 20
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc. (UEI: 611641312)
Address: 10260 CAMPUS POINT DR, SAN DIEGO, CA, 92121
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $12,946,478
Exercised Options: $12,946,478
Current Obligation: $12,946,478
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2008-08-22
Current End Date: 2016-05-22
Potential End Date: 2016-05-22 00:00:00
Last Modified: 2016-07-19
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