DoD's $11.5M contract for explosives support awarded to Applied Research Associates, Inc

Contract Overview

Contract Amount: $11,481,751 ($11.5M)

Contractor: Applied Research Associates, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-08-19

End Date: 2027-08-18

Contract Duration: 1,825 days

Daily Burn Rate: $6.3K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: PROGRAM MANAGEMENT, OPERATIONS AND EXPLOSIVES SUPPORT

Place of Performance

Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87110

State: New Mexico Government Spending

Plain-Language Summary

Department of Defense obligated $11.5 million to APPLIED RESEARCH ASSOCIATES, INC. for work described as: PROGRAM MANAGEMENT, OPERATIONS AND EXPLOSIVES SUPPORT Key points: 1. Contract value represents a significant investment in specialized explosives research and development. 2. Competition dynamics for this niche R&D area may be limited, potentially impacting price. 3. Performance risk is moderate given the specialized nature of explosives research. 4. This contract supports critical defense capabilities related to threat reduction. 5. The sector positioning is within advanced research and development for defense applications.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its specialized nature in explosives R&D. The contract type (Cost Plus Fixed Fee) suggests that costs may fluctuate, and the fixed fee component provides some cost control for the government. Without specific performance metrics or comparable contracts, a definitive value-for-money assessment is difficult. However, the duration and scope indicate a substantial commitment to the contractor's capabilities.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The number of bidders is not specified, but the fact that it was competed openly suggests a degree of market interest. Open competition is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: Taxpayers benefit from the assurance that the government sought the best possible offer through a competitive process, aiming to secure specialized services at a reasonable cost.

Public Impact

The primary beneficiaries are the Department of Defense and its agencies, receiving advanced research and development services. Services delivered include program management, operations, and explosives support, crucial for national security. The geographic impact is primarily centered in New Mexico, where the contractor is located. Workforce implications include employment for specialized scientists, engineers, and technicians in the R&D sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus contracts can lead to cost overruns if not closely monitored.
The specialized nature of explosives R&D may limit the pool of qualified contractors, potentially reducing competition over time.
Long contract durations can sometimes lead to complacency or a decrease in innovation if not actively managed.

Positive Signals

Awarded through full and open competition, suggesting a robust bidding process.
The fixed fee component in the contract type provides some level of cost certainty.
The contract supports critical national security functions, indicating a high level of importance and potential for positive impact.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on biotechnology applications related to explosives. The R&D sector is characterized by innovation and specialized expertise. Comparable spending benchmarks in this niche area are difficult to ascertain without more specific details on the research objectives, but defense-related R&D often represents a significant portion of federal R&D investment.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). Therefore, the direct impact on small business set-asides is minimal. However, Applied Research Associates, Inc. may engage small businesses as subcontractors, contributing to the broader small business ecosystem. Further analysis would be needed to determine subcontracting plans and their impact.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Threat Reduction Agency (DTRA) within the Department of Defense. Accountability measures are inherent in the contract terms, including reporting requirements and performance standards. Transparency is facilitated through contract awards databases, though detailed operational oversight specifics are usually internal. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Threat Reduction Agency (DTRA) Programs
Department of Defense Research and Development
Explosives Safety and Security Programs
Biotechnology Research Contracts

Risk Flags

Potential for cost overruns due to CPFF contract type.
Limited competition in highly specialized R&D fields.
Reliance on contractor's specialized expertise.
Long contract duration may require active management to ensure continued innovation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.5 million to APPLIED RESEARCH ASSOCIATES, INC.. PROGRAM MANAGEMENT, OPERATIONS AND EXPLOSIVES SUPPORT

Who is the contractor on this award?

The obligated recipient is APPLIED RESEARCH ASSOCIATES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Threat Reduction Agency).

What is the total obligated amount?

The obligated amount is $11.5 million.

What is the period of performance?

Start: 2022-08-19. End: 2027-08-18.

What is the track record of Applied Research Associates, Inc. with government contracts, particularly within the Department of Defense?

Applied Research Associates, Inc. (ARA) has a history of performing work for various government agencies, including the Department of Defense. Their expertise often lies in specialized engineering, scientific research, and technical services. Reviewing past performance evaluations and contract histories for ARA would provide insight into their reliability, quality of work, and ability to meet deadlines and budget constraints on similar projects. Specific to defense, ARA has been involved in areas such as threat reduction, materials science, and advanced manufacturing, aligning with the nature of this explosives support contract. A detailed review of their contract portfolio would reveal the scale and complexity of their previous engagements and their success rates.

How does the pricing structure (Cost Plus Fixed Fee) for this contract compare to industry standards for similar R&D services?

The Cost Plus Fixed Fee (CPFF) contract type is common in R&D where the scope of work can be uncertain, and innovation is a key objective. In a CPFF contract, the contractor is reimbursed for allowable costs plus a fixed fee representing profit. This structure incentivizes the contractor to control costs while allowing for flexibility in research direction. Compared to fixed-price contracts, CPFF can carry higher risk of cost overruns for the government if not managed diligently. However, for highly specialized and exploratory R&D, it often provides better value by ensuring access to critical expertise that might not be available under a fixed-price arrangement. Benchmarking requires comparing the fixed fee percentage and the overall cost structure against other CPFF contracts for similar R&D services within the defense sector.

What are the primary risks associated with this explosives support contract, and how are they being mitigated?

The primary risks associated with this explosives support contract include technical challenges inherent in R&D, potential cost overruns due to the CPFF structure, and the specialized nature of the work which could lead to contractor performance issues if expertise is lacking. Mitigation strategies likely include rigorous technical oversight by the Defense Threat Reduction Agency (DTRA), detailed cost tracking and auditing, and clearly defined performance metrics and milestones within the contract. The contractor's established expertise in explosives and related fields, as evidenced by the award, also serves as a risk mitigation factor. Furthermore, the contract's duration and phased approach, if applicable, allow for adjustments based on early performance and evolving research needs.

What is the expected program effectiveness and impact of the services delivered under this contract for the Department of Defense?

The expected program effectiveness and impact of this contract are centered on advancing the Department of Defense's capabilities in threat reduction and explosives management. The research and development services provided by Applied Research Associates, Inc. are intended to yield innovative solutions, improved methodologies, or enhanced technologies related to explosives. This could translate into more effective safety protocols, advanced detection capabilities, or novel approaches to ordnance disposal and neutralization. Ultimately, the contract aims to bolster national security by ensuring the DoD has state-of-the-art expertise and tools to manage explosive threats, thereby reducing risks to personnel and infrastructure.

How does the historical spending on similar explosives R&D contracts by the Department of Defense compare to this award?

Analyzing historical spending on similar explosives R&D contracts by the Department of Defense is crucial for context. This $11.5 million award needs to be viewed against the backdrop of DTRA's overall budget and previous investments in this specific domain. If DTRA has awarded multiple contracts of similar size and scope for explosives R&D in recent years, it suggests a consistent strategic focus. Conversely, a significant deviation in award value or duration might indicate a shift in priorities or a unique, high-stakes research objective. Understanding the trend of spending in this niche area helps assess whether this contract represents a typical investment or an outlier, providing insights into the perceived importance and cost of such specialized R&D.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in Biotechnology (except Nanobiotechnology)

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: TWO STEP

Solicitation ID: HDTRA221R0001

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 4300 SAN MATEO BLVD NE STE A-220, ALBUQUERQUE, NM, 87110

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $11,861,163

Exercised Options: $11,861,163

Current Obligation: $11,481,751

Actual Outlays: $1,203,750

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $10,258,211

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HDTRA222D0002

IDV Type: IDC

Timeline