DoD awards $869M contract for engineering services to NTI Corporation, with a significant portion for basic research

Contract Overview

Contract Amount: $22,488,607 ($22.5M)

Contractor: NTI Corporation

Awarding Agency: Department of Defense

Start Date: 2006-06-29

End Date: 2012-04-06

Contract Duration: 2,108 days

Daily Burn Rate: $10.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Defense

Official Description: 200609!SS4677!1700!N00167!NAVAL SURFACE WARFARE CENTER !N0017804D4093 !A!N! !Y!FD01 ! !20060629!20110630!869318873!869318873!869318873!N!NTI CORPORATION !6539 WINDERMERE CIRCLE !ROCKVILLE !MD!20852!13140!031!24!CARDEROCK !MONTGOMERY !MARYLAND !+000001044576!N!N!000000000000!AC31!RDTE/SHIPS-BASIC RESEARCH !S1 !SERVICES !000 !NOT DISCERNABLE !541330!E! !5!B!M! !A!D!20090331!B! ! !A! !A!N!U!2!021!B! !Z!N!Z! ! !N!B!N!N! ! !A! !A!A!000!A!B!N! ! ! ! !1700!N00167!0001! !

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20852, UNITED STATES OF AMERICA

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $22.5 million to NTI CORPORATION for work described as: 200609!SS4677!1700!N00167!NAVAL SURFACE WARFARE CENTER !N0017804D4093 !A!N! !Y!FD01 ! !20060629!20110630!869318873!869318873!869318873!N!NTI CORPORATION !6539 WINDERMERE CIRCLE !ROCKVILLE !MD!20852!13140!031!24!CARDEROCK !MONT… Key points: 1. Contract value of $869.3M over 5 years indicates substantial investment in engineering and research capabilities. 2. Full and open competition suggests a robust market for these specialized services. 3. The contract's duration and value present a moderate risk for long-term performance and cost management. 4. Services are categorized under RDTE/SHIPS-BASIC RESEARCH, highlighting a focus on innovation and development within the naval sector. 5. The award to NTI Corporation, a single entity, requires careful monitoring of performance and delivery. 6. The contract's primary focus on research and development suggests potential for future technological advancements.

Value Assessment

Rating: good

The total contract value of $869.3 million over approximately five years is substantial. While specific performance metrics and comparable contracts are not detailed in the provided data, the award amount suggests a significant investment in engineering and research services. Benchmarking this against similar large-scale R&D contracts within the Department of Defense would be necessary for a more precise value-for-money assessment. The 'COST NO FEE' contract type implies that the government will reimburse allowable costs, with NTI Corporation not earning a profit margin, which can be a cost-saving measure but requires diligent oversight of incurred expenses.

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 proposals. The data does not specify the number of bidders, but this procurement method generally fosters a competitive environment, which is expected to drive better pricing and service quality. The fact that it was competed broadly suggests that the government sought the best available solution from the market.

Taxpayer Impact: A full and open competition is favorable for taxpayers as it increases the likelihood of obtaining services at competitive prices and encourages a wider range of innovative solutions.

Public Impact

The primary beneficiaries are the U.S. Navy and the Department of Defense, receiving advanced engineering and basic research services. Services delivered include research, development, testing, and evaluation, particularly focused on naval systems and technologies. The geographic impact is primarily centered around the Naval Surface Warfare Center (Carderock, MD) and potentially extends to other naval facilities. Workforce implications include the employment of engineers, scientists, and technical personnel by NTI Corporation and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if 'COST NO FEE' contract type leads to unmanaged allowable costs.
Dependence on a single contractor (NTI Corporation) for critical research and engineering services.
Risk of scope creep if research objectives are not clearly defined and managed throughout the contract lifecycle.
Ensuring the long-term relevance and applicability of basic research outcomes to future naval needs.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that likely yielded a strong proposal.
Focus on basic research indicates investment in foundational technologies that could lead to significant future advancements.
The contract's substantial value suggests NTI Corporation possesses the necessary expertise and capacity for complex R&D.
Long contract duration (over 5 years) allows for sustained focus and development on complex research problems.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting the Department of Defense's research, development, testing, and evaluation (RDTE) efforts for naval systems. The market for defense-related engineering and R&D services is substantial, driven by continuous modernization needs. Comparable spending benchmarks would involve analyzing other large-scale RDTE contracts awarded by the Navy or other military branches for similar specialized engineering and scientific support.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. As a large prime contract awarded through full and open competition, it is unlikely to have a direct small business set-aside. However, NTI Corporation may be required to subcontract a portion of the work to small businesses, which would be detailed in the contract's subcontracting plan, if applicable.

Oversight & Accountability

Oversight for this contract would primarily be managed by the Naval Surface Warfare Center (NSWC) and the Defense Contract Management Agency (DCMA). Accountability measures would be embedded in the contract's performance work statement, requiring adherence to research milestones and technical specifications. Transparency is facilitated through contract awards databases, though detailed performance reports are typically internal to the government. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval Research and Development Programs
Shipbuilding and Conversion, Navy
Defense Research and Development
Engineering and Technical Services
Naval Surface Warfare Center Contracts

Risk Flags

Cost Control Risk (Cost No Fee)
Performance Monitoring
Scope Management
Contractor Dependency
Long-Term Relevance of Research

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.5 million to NTI CORPORATION. 200609!SS4677!1700!N00167!NAVAL SURFACE WARFARE CENTER !N0017804D4093 !A!N! !Y!FD01 ! !20060629!20110630!869318873!869318873!869318873!N!NTI CORPORATION !6539 WINDERMERE CIRCLE !ROCKVILLE !MD!20852!13140!031!24!CARDEROCK !MONTGOMERY !MARYLAND !+000001044576!N!N!000000000000!AC31!RDTE/SHIPS-BASIC RESEARCH !S1 !SERVICES !000 !NOT DISCERNABLE !541330!E! !5!B!M! !A!D!200

Who is the contractor on this award?

The obligated recipient is NTI CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $22.5 million.

What is the period of performance?

Start: 2006-06-29. End: 2012-04-06.

What is NTI Corporation's track record with the Department of Defense, particularly in research and development contracts?

NTI Corporation has a history of performing work for the Department of Defense. While this specific contract is for a significant amount ($869.3M), further analysis of their past performance on similar RDTE contracts would be beneficial. This includes examining their successful delivery of research objectives, adherence to schedules, and management of costs on previous DoD engagements. Understanding their experience with 'COST NO FEE' type contracts, if any, would also provide insight into their cost control capabilities. A review of past performance evaluations and any contract disputes or awards would offer a more comprehensive view of their reliability and expertise in the defense R&D sector.

How does the $869.3 million contract value compare to similar basic research and engineering services contracts awarded by the Navy?

The $869.3 million contract value is substantial and indicates a significant investment in engineering and basic research services for the Navy. To benchmark this value, one would compare it against other large-scale RDTE contracts awarded by the Naval Sea Systems Command (NAVSEA) or other Naval Warfare Centers over the past 5-10 years. Factors such as the specific technical areas (e.g., ship systems, materials science, propulsion), contract duration, and the number of bidders in those comparable procurements are crucial. Without access to a broader dataset of similar contracts, it's difficult to definitively state if this represents a high, low, or average investment, but its magnitude suggests it is a major program.

What are the primary risks associated with a 'COST NO FEE' contract of this magnitude and duration?

A 'COST NO FEE' contract, while potentially beneficial for cost control by eliminating profit, carries specific risks. For this $869.3 million contract over five years, the primary risk is the government bearing all allowable costs without a profit incentive for the contractor to optimize efficiency or innovation beyond meeting minimum requirements. This necessitates rigorous government oversight to ensure that all claimed costs are reasonable, allocable, and allowable. There's also a risk that the contractor might prioritize cost recovery over achieving superior technical outcomes if not managed carefully. Furthermore, if the scope of research is not tightly controlled, the government could incur significant expenses without a clear return on investment, especially in the realm of basic research where outcomes can be uncertain.

How effective is the 'FULL AND OPEN COMPETITION' strategy likely to be in ensuring value for money for this basic research contract?

The 'FULL AND OPEN COMPETITION' strategy is generally the most effective method for ensuring value for money, as it allows the widest possible pool of qualified contractors to bid. This competitive pressure typically drives down prices and encourages innovative approaches. For a basic research contract, where the ultimate outcomes can be uncertain, competition can help identify the most promising research avenues and the most capable teams at the best possible price. However, the effectiveness also depends on the clarity of the solicitation, the evaluation criteria, and the government's ability to accurately assess the technical merit and cost proposals of multiple complex research approaches.

What are the potential long-term implications of this contract on naval technology development and the defense industrial base?

This contract, with its significant focus on basic research for naval systems, has the potential to drive significant long-term technological advancements for the Navy. Successful research outcomes could lead to next-generation capabilities in areas such as materials, propulsion, sensors, or autonomous systems. It also supports the defense industrial base by providing substantial funding to NTI Corporation, potentially enabling them to grow their expertise, workforce, and infrastructure in specialized R&D areas. This, in turn, can foster innovation and maintain a critical technological edge for the U.S. Navy against potential adversaries.

How does the $869.3 million total award amount compare to historical spending on similar engineering and R&D services by the Department of Defense?

The $869.3 million total award amount represents a significant investment. To contextualize this historically, one would need to examine DoD's annual spending on engineering services and R&D, particularly within the Navy and for shipbuilding/ship systems. For instance, comparing this single contract's value to the total annual budget allocated for naval basic research or engineering support over the last decade would provide perspective. If this contract represents a substantial portion of the Navy's annual budget for a specific R&D category, it highlights its importance. Conversely, if it's one of many large contracts, it might be considered standard for major R&D initiatives.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002406R3157

Offers Received: 1

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Address: 6539 WINDERMERE CIR, ROCKVILLE, MD, 20852

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Subchapter S Corporation

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4093

IDV Type: IDC

Timeline