DoD awards Raytheon $29.5M for SNM detection prototype, raising questions on value and competition
Contract Overview
Contract Amount: $29,490,646 ($29.5M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2009-12-10
End Date: 2014-06-30
Contract Duration: 1,663 days
Daily Burn Rate: $17.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 6
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: R&D SERVICES - BUILD A PROTOTYPE TO DETECT AND IDENTIFY SNM.
Place of Performance
Location: TEWKSBURY, MIDDLESEX County, MASSACHUSETTS, 01876
Plain-Language Summary
Department of Defense obligated $29.5 million to RAYTHEON COMPANY for work described as: R&D SERVICES - BUILD A PROTOTYPE TO DETECT AND IDENTIFY SNM. Key points: 1. Significant investment in advanced R&D for national security. 2. Sole provider for a critical, specialized technology. 3. Potential for cost overruns in a cost-plus contract. 4. Limited small business participation noted.
Value Assessment
Rating: questionable
The $29.5 million contract for a prototype is substantial. Without clear performance metrics or benchmarks for similar R&D efforts, assessing its value is difficult. The cost-plus fixed fee structure introduces risk of cost escalation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the specific nature of the R&D may limit the number of truly capable bidders, potentially impacting price discovery.
Taxpayer Impact: Taxpayer funds are supporting critical defense research. The effectiveness of the prototype and its eventual deployment will determine the long-term value for money.
Public Impact
Enhances national security capabilities in detecting special nuclear materials (SNM). Supports technological advancement in a critical defense sector. Potential for follow-on contracts if the prototype is successful. Investment in specialized scientific research and development.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus contract type
- Lack of small business participation
- Long contract duration
Positive Signals
- Full and open competition
- Critical national security application
Sector Analysis
This contract falls under Research and Development in Physical, Engineering, and Life Sciences. Defense R&D spending is a significant portion of the federal budget, with a focus on innovation and technological superiority.
Small Business Impact
The contract was not awarded to small businesses, as indicated by 'sb': false. This suggests a lack of opportunities for small businesses in this specific R&D project, potentially limiting broader economic impact.
Oversight & Accountability
The Department of Defense, through the Defense Contract Management Agency, is responsible for oversight. The contract's duration and cost-plus nature necessitate diligent monitoring to ensure efficient use of funds and successful prototype development.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Cost-plus contract type
- Long contract duration (over 5 years)
- Lack of small business participation
- High contract value for a prototype
- Potential for scope creep in R&D
Tags
research-and-development-in-the-physical, department-of-defense, ma, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $29.5 million to RAYTHEON COMPANY. R&D SERVICES - BUILD A PROTOTYPE TO DETECT AND IDENTIFY SNM.
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $29.5 million.
What is the period of performance?
Start: 2009-12-10. End: 2014-06-30.
What are the key performance indicators for the SNM detection prototype, and how will their achievement be measured to ensure value for money?
Key performance indicators (KPIs) for the SNM detection prototype should focus on sensitivity, specificity, detection range, and false alarm rates. Measuring achievement requires rigorous testing protocols, independent validation, and comparison against established scientific standards or simulated operational environments. Success will be defined by the prototype's ability to reliably and accurately detect SNM under various conditions, justifying the significant investment.
Given the specialized nature of the R&D, what steps were taken to ensure robust competition and prevent potential vendor lock-in?
While awarded under full and open competition, the specialized nature of R&D can inherently limit bidders. To ensure robust competition, the agency likely issued detailed technical requirements and sought proposals from a wide range of qualified entities. Preventing vendor lock-in would involve planning for future phases with potential for re-competition, encouraging technology transfer, and maintaining clear documentation of the developed intellectual property.
How does the cost-plus fixed fee structure mitigate risks for both the government and the contractor in this complex R&D environment?
The cost-plus fixed fee (CPFF) structure aims to balance risk. The government agrees to pay the contractor's allowable costs plus a predetermined fixed fee, providing the contractor with a guaranteed profit margin. This incentivizes the contractor to perform the work efficiently. For the government, it allows for R&D in complex, uncertain areas where fixed-price contracts might be impractical, while the fixed fee caps the profit element.
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: TWO STEP
Offers Received: 6
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 350 LOWELL ST, ANDOVER, MA, 01810
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $29,490,646
Exercised Options: $29,490,646
Current Obligation: $29,490,646
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2009-12-10
Current End Date: 2014-06-30
Potential End Date: 2014-06-30 00:00:00
Last Modified: 2024-11-22
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