Dod's $27.5M R&D Contract With BAE Systems Space & Mission Systems Inc. Awarded in 2001

Contract Overview

Contract Amount: $27,512,785 ($27.5M)

Contractor: BAE Systems Space & Mission Systems Inc.

Awarding Agency: Department of Defense

Start Date: 2001-01-25

End Date: 2005-01-25

Contract Duration: 1,461 days

Daily Burn Rate: $18.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS AWARD FEE

Sector: R&D

Place of Performance

Location: BOULDER, BOULDER County, COLORADO, 80301

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $27.5 million to BAE SYSTEMS SPACE & MISSION SYSTEMS INC. for work described as: Key points: 1. Contract awarded via full and open competition, suggesting a broad search for qualified vendors. 2. The contract type is Cost Plus Award Fee (CPAF), which incentivizes performance but can lead to higher costs if not managed carefully. 3. Research and Development in Physical, Engineering, and Life Sciences (NAICS 541710) is a critical area for technological advancement. 4. The contract duration of 1461 days (4 years) indicates a significant, long-term project. 5. The awarding agency is the Missile Defense Agency, highlighting its focus on advanced defense technologies. 6. No small business set-aside was utilized, meaning opportunities for small businesses were not specifically prioritized in the initial award.

Value Assessment

Rating: fair

Benchmarking the value of this specific R&D contract is challenging without detailed performance metrics and comparable project outcomes. The Cost Plus Award Fee (CPAF) structure allows for cost reimbursement plus a fee based on performance, which can be effective for innovation but also carries a risk of cost overruns if performance targets are not clearly defined or achieved. The total award amount of $27.5 million over four years suggests a substantial investment in research and development, but its true value depends on the technological advancements and strategic benefits realized.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that the Missile Defense Agency sought proposals from all responsible sources. While the number of bidders is not specified, this approach generally fosters a competitive environment, potentially leading to better pricing and innovative solutions. The open competition suggests that the agency believed multiple contractors possessed the necessary capabilities for this complex R&D effort.

Taxpayer Impact: Taxpayers benefit from full and open competition through the potential for more competitive pricing and a wider range of innovative solutions being considered, which can lead to more effective use of public funds.

Public Impact

The primary beneficiaries are the Department of Defense and the Missile Defense Agency, gaining access to advanced research and development capabilities. The services delivered are focused on research and development within the physical, engineering, and life sciences, crucial for national security. The geographic impact is primarily within the United States, supporting domestic technological advancement and defense capabilities. Workforce implications include employment for highly skilled scientists, engineers, and researchers involved in cutting-edge R&D projects.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts can sometimes lead to higher final costs if award criteria are not strictly managed.
The long duration of the contract requires sustained oversight to ensure continued alignment with evolving defense needs.
The specific R&D outcomes are not detailed, making it difficult to assess the immediate return on investment.

Positive Signals

Awarded through full and open competition, maximizing the pool of potential contractors.
The CPAF structure incentivizes contractor performance and innovation.
The contract supports critical research and development for national defense.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. This sector is vital for maintaining a technological edge in defense. Comparable spending in this area can vary widely depending on the specific research focus, but significant government investment is typical for advanced defense R&D. The market for such specialized R&D services is often dominated by large, established defense contractors with proven expertise and security clearances.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. This suggests that the primary focus was on securing the most capable large contractor for this specialized R&D effort. Consequently, the direct impact on the small business ecosystem for this specific award appears limited, though larger prime contractors may engage small businesses as subcontractors on other projects.

Oversight & Accountability

Oversight for this contract would typically be managed by the Missile Defense Agency, with specific program managers responsible for monitoring progress, costs, and performance against award fee criteria. The CPAF structure necessitates robust oversight to ensure that award fees are justified by demonstrable performance improvements. Transparency would be facilitated through regular reporting requirements from the contractor and potential reviews by the Government Accountability Office (GAO) or the Inspector General, depending on the nature of any concerns.

Related Government Programs

Missile Defense Systems
Advanced Research Projects
Department of Defense Research and Development
Aerospace and Defense Technology Development

Risk Flags

Cost Overrun Risk
Performance Uncertainty
Long-Term Project Management

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.5 million to BAE SYSTEMS SPACE & MISSION SYSTEMS INC.. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS SPACE & MISSION SYSTEMS INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Missile Defense Agency).

What is the total obligated amount?

The obligated amount is $27.5 million.

What is the period of performance?

Start: 2001-01-25. End: 2005-01-25.

What was the specific research and development objective of this contract?

The provided data indicates the contract falls under NAICS code 541710, 'Research and Development in the Physical, Engineering, and Life Sciences,' and was awarded by the Missile Defense Agency. While the exact R&D objective is not detailed, it is highly probable that the contract aimed to advance technologies related to missile defense systems. This could encompass areas such as sensor development, interceptor technologies, guidance systems, or advanced materials science pertinent to missile defense applications. The 'Space & Mission Systems' in the contractor's name further suggests a focus on the broader systems integration and operational aspects of defense technologies.

How does the Cost Plus Award Fee (CPAF) structure typically function in R&D contracts?

The Cost Plus Award Fee (CPAF) contract type reimburses the contractor for allowable costs incurred and provides a base fee, plus an additional award fee. The award fee is determined by the government based on the contractor's performance against pre-defined criteria, which are often subjective and related to achieving specific technical milestones, schedule adherence, or innovation. For R&D contracts, CPAF is often used when the scope of work is not fully defined or when there is a high degree of uncertainty, as it incentivizes the contractor to exceed minimum performance expectations. However, it requires careful government oversight to ensure that award fees are earned and that costs remain controlled.

What is the typical performance period for R&D contracts of this magnitude?

The performance period for R&D contracts can vary significantly based on the complexity and scope of the research. For a contract valued at $27.5 million awarded by the Missile Defense Agency, a duration of four years (1461 days) is not uncommon. Such R&D efforts often involve multiple phases, from initial concept development and feasibility studies to prototyping and testing. Longer performance periods allow for thorough investigation, iterative development, and the potential for unexpected challenges to be addressed without immediately jeopardizing the project's timeline or budget. Shorter contracts might focus on specific, well-defined research tasks, while longer ones are typical for more exploratory or foundational R&D.

What are the potential risks associated with a 'full and open competition' award for R&D?

While 'full and open competition' is generally preferred for maximizing value and innovation, potential risks for R&D contracts include the possibility of selecting a contractor whose proposed approach, while innovative, may prove technically infeasible or excessively costly to develop. The broad nature of R&D means that outcomes are inherently uncertain. If the competition is too broad without sufficiently clear technical requirements, it might attract bidders who do not fully grasp the specific challenges of missile defense R&D, leading to potential performance issues later. Furthermore, managing a large number of proposals can be resource-intensive for the procuring agency.

How does the Missile Defense Agency typically manage its R&D portfolio?

The Missile Defense Agency (MDA) manages its R&D portfolio by focusing on developing and fielding integrated air and missile defense capabilities. They often employ a mix of contract types, including CPAF, to incentivize performance in complex, high-risk R&D programs. The MDA's strategy typically involves investing in both incremental improvements to existing systems and breakthrough technologies for future defense needs. They work closely with industry partners, research institutions, and other government agencies to identify and mature critical technologies. Oversight is rigorous, with a strong emphasis on technical reviews, testing, and ensuring that R&D investments align with evolving threat assessments and strategic defense objectives.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences

Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 2

Pricing Type: COST PLUS AWARD FEE (R)

Contractor Details

Parent Company: Ball Corp (UEI: 006419147)

Address: 1600 COMMERCE STREET, BOULDER, CO, 02

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline